A valuable behavioral ethics and compliance resource

The Institute of Business Ethics recently published Using Behavioural Ethics to improve your Ethics Programme, a Business Ethics Briefing. For those interested in “behavioral ethics and compliance” – a frequently addressed topic in this blog – the briefing is a must read.

Among the suggestions made in this piece is: “Ethics needs to become part of [an organization’s] reward, recognition and promotion system.” While, to some extent,  one could reach this conclusion using a classical economics framework, the IBE briefing approaches it from an “availability bias” perspective. Specifically,  they write: “the availability bias refers to the human tendency to judge an event by the ease with which examples of the event can be retrieved from your memory. The availability bias leads people to overestimate the likelihood of something happening because a similar event has either happened recently or because they feel emotional about a previous similar event. This has a significant impact on the ability of organisations to promote ethics. If employees can recall a case where a person has been promoted or rewarded for the commercial results they achieved even when it is widely known that how they achieved them was ethically questionable, they will think that this is the norm in the organisation – even if it was just a one off event. On the other hand, publicly recognising and rewarding people that distinguish themselves for living up to the organisation’s ethical values or communicating positive stories internally can be a quick and effective way to send employees the message that ethics is important in the organisation.”

Another suggestion from IBE  – and, in my view, a best practice –  arises out of the famous “Good Samaritan” behavioral  experiment, which demonstrated that time pressure could be a powerful cause of unethical behavior. The Briefing describes how GlaxoSmithKline “used this research as a basis for developing their own scenario [in their ethics training] that addresses the topic of work-home balance and time pressure. This has enabled employees to discuss the issue openly and increased awareness of the role that time pressure can have on our decision making abilities.”

A third suggestion concerns the “framing effect,” which shows that “[c]hoices can be worded in a way that highlights the positive or negative aspects of the same decision, leading to changes in their relative attractiveness.” Specifically, the briefing  describes how “[t]he global management, engineering and development consultancy Mott MacDonald recognised this when they changed the name of their reporting line from ‘whistleblowing facility’ to adopt a more positive name – Speak Up Line.  As a result, they noticed a significant increase in the number of concerns raised.”

Finally, with respect to the core behavioral area of “nudging,” IBE “suggests that an approach that focuses on ethics – communicating the ethical values, explaining how and why an organisation does its business, encouraging individual judgement based on ethical values – is at least as important as having clear rules of conduct that employees must follow and the related sanctions.” Note that I want to believe this is so and to some extent do, but I also have some doubts – or at least questions – about it, as discussed in this earlier post.

The briefing has various other helpful suggestions, but as a nudge to get you to read the original I’ll  stop here.

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