Sweating the small stuff

In Behavioral Ethics as Compliance  (Cambridge Handbook of Compliance (Van Rooij & Sokol Eds)) Yuval Feldman and Yotam Kaplan write:

“[C]urrent approaches to law enforcement and compliance tend to focus on “smoking guns” and extreme violations of the law as the core case and as the ultimate manifestation of the problem of illegality. This tendency is understandable, as it would seem most important to prevent wrongdoing in those cases where it produces the most harm. However, behavioral ethics findings challenge this prevailing wisdom. While devastating in their effects, extreme violations of the law are relatively rare as they are difficult for most people to ignore or justify. On the other hand, most people can, and very often do, ignore and justify “minor” violations, or acts of “ordinary unethicality:” supposedly small deviations from legal and ethical norms common in day-to-day activities. This means that acts of ordinary unethicality can be by far more common, and therefore by far more harmful in the aggregate. Ordinary unethicality can be found in all areas of the law, from contract breach and disregard for the property of others, to corruption in administrative law, corporate misconduct, or insensitive interpersonal behavior. Behavioral ethics research suggests that ‘minor’ wrongs are endemic, widespread and difficult to regulate and prevent.”

This analysis dovetails to some degree with the notion of “slippery slopes.” As noted in an earlier post :  “One of the most important facets of behavioral ethics research concerns slippery slopes. As described in a paper by Francesca Gino and Max Bazerman: “Four laboratory studies show that people are more likely to accept others’ unethical behavior when ethical degradation occurs slowly rather than in one abrupt shift. Participants served in the role of watchdogs charged with catching instances of cheating. The watchdogs in our studies were less likely to criticize the actions of others when their behavior eroded gradually, over time, rather than in one abrupt shift.”

Of course, the points that Feldman and Kaplan are making go beyond slippery slopes – and apply broadly to the overall approach to risk assessment that companies take. E.g., their article essentially suggests an inverse relationship between risk impact and risk likelihood.

What should C&E officers do with this information? Among other things, it should be used to train employees on the importance of not allowing seemingly trivial unethical acts to go unchecked, a particularly important point when dealing with busy business leaders who may believe that their attention should be saved for only “serious” infractions. This can be part of a general approach to training that presents “heightened ethical awareness” as a core leadership skill.

 

One Comment
  1. Jason Lunday 11 months ago

    This builds the case that if a compliance officer is only trying to stop the big violations, the company should be looking for a new compliance officer. Too much research supports the understanding that even trivial problems can wreak a workplace culture and dimiish employee engagement and loyalty. Compliance officers need to operate across all fronts, and Jeff Kaplan’s continued research on behavioral ethics provides the roadmap for what compliance officers need to understand and pursue.

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