How ethically confident should we be?

My favorite Marxist philosopher – Groucho – once said: “I have nothing but confidence in you, and very little of that.” But the same is not true of how much confidence we tend to have in ourselves.

An article last week in the Slovak Spectator  reported that “one of the findings of a survey conducted by the Slovak Compliance Centre… in 2014 [was that] ‘[t]he companies seem to be quite sceptical of the conduct of other market players while expressing relative confidence in ethical conduct inside their own organisations,…” I imagine that one would find similar asymmetry of views  nearly anywhere in the world.

Indeed, much of the field of “behavioral ethics” is addressed to proving that “we are not as ethical as we think.”  Prior posts on behavioral ethics can be found here.

The view of human nature underlying this key insight predates the behavioral ethics field.  Perhaps most famously, Judge Learned Hand said in 1944:  “The spirit of liberty is the spirit which is not too sure that it is right.” I believe that this is a good way to view the spirit of compliance and ethics too.

At least as applied to C&E, this is not to say that we should be relativistic about what is right.  Rather, we should be skeptical about our ability to do what is right when pressures or temptations pull us in the wrong direction. Those likely to be confronted by risks of misconduct (e.g., corruption or competition law violations) should strive to be ethically alert – which is not always consistent with being highly confident.

Indeed, while the focus on corporate culture is a generally a very positive development in the C&E field, it carries the danger that having a strong culture could be seen as obviating the need for the regular “blocking and tackling” that C&E programs are based on.  This is particularly true of glorification of – and over-reliance in some companies  on –  the “tone at the top.”

On the other hand, one should also be skeptical about the value of pessimism. Given how relatively new the C&E field is – and the tendency for many to view it as a fad which has overstayed its welcome – a truly pessimistic view can effectively scuttle a compliance program.

That is, some degree of optimism is absolutely necessary for the effective operation of a C&E program – whether it is a salesperson choosing to forgo a questionable business opportunity or a mid-level manager deciding whether to call the hotline. Optimism is also necessary for boards of directors and senior managers in determining whether to invest the substantial time and other company resources needed to develop and maintain an effective C&E program, particularly given that the empirical case for such programs is still a work in progress.

For every company, the right C&E confidence quotient will be different.  But all should to some degree be both skeptical and optimistic.

3 Comments
  1. wayne brody 2 years ago

    Jeff- I have that quote from Learned Hand hanging above my desk, a reminder that dogmatic rectitude – particularly for those who exercise authority (corporate or civil) – is a threat to both liberty and progress. To your point, it doesn’t suggest that we avoid the obligation to determine what is right and act upon it, but that we continually strive to hone that understanding and remain open to others. I think this a fundamental part of that “respect” thing we values-types like to talk about.

    And it strikes me that the optimism to which you refer depends on that same openness, and is just as fundamental. As Noam Chomsky put it, “Optimism is a strategy for making a better future. Because unless you believe that the future can be better you are unlikely to step up and take responsibility for making it so.”

    In this sense, optimism is key to the spirit and purpose of C&E, a practice born of the belief that the future can, indeed, be better if we step up and make it so.

    • Jkaplan 2 years ago

      Wayne, A great point about optimism. Thanks for you comment. Best, Jeff

  2. Scott Killingsworth 2 years ago

    Regarding your initial observation that people tend think their company is more ethical than others — I think this premise can be part of a dysfunctional feedback loop, at least where the “others” are one’s competitors, as mentioned in the Slovak Spectator article. If you think your competitors are cheating to win in the marketplace, then when you are faced with a temptation to cheat, two ready rationalizations are at hand: “everybody’s doing it, so it must be OK” and “we have to do it to remain competitive.” This certainly plays out in the procurement-bribery context. Once these rationalizations are accepted, one can maintain one’s positive self image as an ethical person (or company), just one who is unfortunately forced to accept the implacable realities of the marketplace.

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