“Third prize is you’re fired”

In David Mamet’s Glengarry Glen Ross the boss explains a new sales contest to the assembled members of the office:

“The first prize is a Cadillac El Dorado. Anyone wanna see second prize? Second prize is a set of steak knives. Third prize is you’re fired.”

The corrupting influence of high-pressure is an oft-told tale. In recent years the most prominent  case of this sort involved Wells Fargo, where a toxic corporate culture pressured many employees to engage in serious legal and ethical transgressions.

The impact of pressure on ethicality has been shown to work not only as a matter of practice but also theory. That is, many years earlier, in what was perhaps the mother of all ethics/compliance experiments, individuals put under time pressure were about six times more likely to engage in unethical conduct than were those not under such pressure – an incredible result.

Most recently, in its invaluable Global Business Ethics Survey: the State of Ethics and Compliance in the Workplace the Ethics Compliance Initiative reported that: “Pressure to compromise ethical standards is the highest it has ever been” in the US. The phenomenon is not just limited to the US.  E.g., “Employees in China are experiencing a five-fold increase in pressure.”

Dealing effectively with pressure is one of the greatest challenges a C&E program can face.   Some of the things that a company might consider in this area:

– Having the CEO speak about the need to avoid undue pressure at key times (such as near the end of a financial reporting period).

– Cascading the message down through the ranks of management.

– Having the manager’s duties section of the code of conduct address the issue of avoiding undue pressure.

– Including the issue in performance evaluations.

– Having pressure within the scope of the risk assessment.

– Including pressure in the interview sections of audits. and assessments.

Of course, not every company needs to do all of these, and some will address the issue of undue pressure in other ways.