There are numerous benefits to creating an ethical culture in your company and the more studies that are conducted, the more positive the proof. Here are 5 key benefits to consider:
- An Ethical Management Team is Good for Business – In a company where there is the perception that management really values their employees, their vendors and their customers, the performance of the company is notably better, especially in times of an economic downturn. When the management team behaves ethically, there is the perception that the contribution of each employee is rewarded and appreciated; that the interests of each customer and employee become a priority. Here’s the tricky part; unless the management team, from the president or CEO on down, embraces the same ethical construct, no program or policy works. In fact, when the attitude of the management team is one of “do as we say, not as we do,” productivity and business can decline.
- Customers Buy More from an Ethical Company – It is true. Word gets out, and word gets around. Think of a word of mouth experience from an ethical company before you even “set foot” in the door; Nordstrom’s comes to mind as does Starbucks, T-Mobile and Google. This does not happen by accident, but by a corporate commitment to good ethics.
- Ethical Companies Operate More Profitably – It has been estimated that all factors being equal, when management behaves badly, without an ethical direction, virtually all of those companies are less profitable than a company where everyone buys in to good ethics. When there are lower rates of observed acts of unethical behavior, employees are less likely to “steal” time, product or supplies and to increase the reporting of misconduct to the leadership of the company. All of this translates to lower expenses. Again, the key is a buy-in from the newest intern hire to the board members.
- An Ethical Organization is a Healthy Organization – A corporate culture that is built on a solid ethical foundation has a stronger base of employee satisfaction. In these organizations, there is a reduced pressure to relax standards, greater respect for a company’s leadership and an increased sense of what should be done in case of a real crisis. In crisis situations, there is less finger-pointing and much more of an attitude of “we are all in this together.” If everyone has done the ethical and right thing, the problem can be quickly addressed with good resolution. If management must cover-up or look for scape-goats, it will quickly reflect on the entire organization.
- An Ethical Organization Understands Its Goals – If we know we are going to create an ethical culture rather than talking and writing policies about an ethical climate, we will be better able to allocate resources, create dynamic relationships across departments, better reward performance and set more attainable goals. In an ethical environment, it is not “them” versus “us.” Leaders are perceived as being humble and aggressive (in a good sense) in their professional courage to do what is necessary to have an ethical compass.
My career has been based on leading corporations, associations and teams to developing true ethical cultures and not just manuals or policies. I teach about an inner journey of values, ethics and good consequences.
