How honest are you? Take this test
October 23, 2009 by Jim GiulianoPosted in: Behavior, Communication, Special Report
In the wake of the Great Economic Meltdown of ‘08 — and the cheating that preceded it — business schools are considering an ethics test before sending grads into the real world. Would you pass it?
The test — based on real-life situations — has been developed by Babson College, Yale and the Aspen Institute, and is being considered for use by 80 colleges nationwide. Ready for it? Here goes (answers at the bottom):
Scenario #1
You’re a rising executive just promoted to corporate controller. Shortly after you land the new job, several senior executives pressure you to distort the company’s restructuring charges in a way that would be misleading but not criminal.
What do you do?
- Politely explain to the senior execs that you won’t stand for fudging the numbers.
- Modify the charges. Since it’s not illegal, you can draw the line later when you have more experience in the job.
- Research what the company has done in similar situations in the past and follow suit.
- Go over the senior execs’ heads right to the CEO.
Scenario #2
You join a nonprofit firm in a junior accounting role. As you review the year’s corporate donations, you quickly realize that no standard procedure exists to determine the value of in-kind donations (gifts in the form of goods or services rather than cash). Some of your most prolific donors inflate valuations to deceive the IRS. Your overworked executive director makes a point of emphasizing relationships above data.
What do you do?
- Nothing. What the donors tell the IRS is their business and your organization can’t afford to alienate them.
- Bring up the problem at the next staff meeting. Since you’re in a junior role, you can only do so much.
- Find an ally in a senior position and keep pushing for a solution.
- Develop your own system to value each major in-kind donation in time for next tax season, and present what you’ve done to the senior executives.
Scenario #3
You’re a junior employee at a large investment bank. Hours before a client meeting, a portfolio manager tells you to review the portfolio of one of the bank’s smallest customers and find a new benchmark that will make it look like the portfolio had performed better than it really had. You know that the client remains with the bank as a favor to a friend who works there.
What do you do?
- Point out that misleading the client risks getting the manager in trouble, and the client isn’t going anywhere. Be frank: underperformance happens in uncertain markets.
- Don’t take a chance with a manager who asks you to lie. Immediately take your concerns to another manager.
- Find the new benchmark. As long as you footnote it, you haven’t done anything illegal.
- Duck the request to mislead the client and prepare a presentation that encourages the client to focus on the future.
Answers
Scenario #1. Correct choice: 4.
Several arguments could justify inaction: You’re too new; you need to wait until you’re more settled into the role and have the trust and confidence of the senior execs. Plus, raving about ethics to the team is a sure way to establish antagonistic relationships only a few days into the job.
On the other hand, if you wait to speak up until you’re fully entrenched, it could be much more difficult to reverse course. In the real-life situation that inspired the case study, the comptroller used his newness in the position as a way to break with the status quo. He went directly to the CEO with a new guiding vision for the finance department emphasizing its commitment to integrity. He focused on wanting to ensure the long-term survival of the company and rather than ask, the comptroller simply assumed that he and the CEO would be on the same side. It worked; the CEO supported his plan and in the process the comptroller successfully established his authority in the new role.
Scenario #2 Correct choice: 3.
In this kind of a scenario, junior employees typically can’t get past the feeling of powerlessness, says Mary Gentile, a Babson College researcher who helped develop the ethics curriculum. They’re low on the totem pole, so they “question their standing, their judgment, and their legitimacy” in taking a stand against unethical behavior that has become part of the company culture, she says.
In this case, the new hire decided to use his naïveté to his advantage. He approached the executive director and simply asked, “How do we standardize our donation valuations here?” The director never did act on his concerns, and soon left the nonprofit. The junior employee finally took his questions to the lead accountant and an outside auditor. He worked with them to establish an “average cost per box” formula the company would use if donors didn’t submit a written audit. Since it was a formal policy change, donors did not see it as a personal affront.
Scenario #3 Correct choice: 4.
You could justify not saying anything because the bank creates the benchmark and as long as you footnote it, you’ve done nothing illegal. Plus, given the size and relative importance of the portfolio, in all likelihood the manager simply overlooked it. If you refuse to lie on moral grounds, you’ll offend the manager and he will just ask another associate to take care of it anyway.
The woman in the case tried a different approach. She explained to the portfolio manager that she wouldn’t have time to provide an analysis for the new set of numbers before the meeting. Instead, she offered to provide data explaining the portfolio’s underperformance, which the manager could use to suggest a more suitable investment plan for the client. To her surprise, he agreed.
Tags: aspen institute, babson, yale
October 23rd, 2009 at 7:42 am
Passing a test doesn’t mean you are going to do the right thing in a real circumstance. Just look at all the agenda-driven judges around the country, and our “transparent” president.
October 26th, 2009 at 8:30 am
Hi there,
HR Mgr for large healthcare org in southeastern Michigan…
I’ve been given the task of coming up with a “year end review” with the Recruiters… I’d like to include a game, something will require great interaction and stimulating conversation… any suggestions?
rdc
October 26th, 2009 at 9:45 am
Amen John! We all say we would but how many employees “really” would take a chance at coming from left field when faced with the possibility of losing their job or becoming alienated within the company. In most “real” circumstances, the employees IS powerless. Nice utopian scenarios though.
John: I’d say most of our government system is transparent. They run on one platform and when they get elected, promptly take out the secret agenda and what the people want doesn’t matter. They are mostly all drunk with too much power!
October 26th, 2009 at 9:57 am
Throughout my career I’ve always been fortunate to have had the support of the most senior executives for doing the right thing without compromise. In some cases I have felt that I was risking my job in sticking my neck out but never regreted doing so. I just wish there were more ethics-driven businesses and governmental individuals.
October 26th, 2009 at 10:21 am
I find that there is a great chasm between “being ethical” and “following ethical codes.” It seems that every profession and organization has established an “ethical code” that somehow defines ethical behavior on the job. In fact, they are just more stringent “laws” or rules that hopefully result in punishment before the government gets involved.
Ethics is about the values and the thought process behind decisions. I get a hoot out of people talking about “ethical behavior” without talking about what the person was thinking. It would be “behavior”, but I wouldn’t be able to label it as “ethical.” Thoughts drive behavior. Unless you know how a person thinks about a situation, you won’t be able to predict how they will perform in future situations. Ethics is about character. Its more about who we are and who we want to be rather than what we do.
In my experience, ethical decisions are usually difficult and pose a great possibility for negative consequences (especially when the flow is taking the path of least resistance). Honesty, integrity, etc. are values we strive to hold on to for ourselves.
October 26th, 2009 at 10:24 am
Hey all: On my answers I chose 1, 4, 1… I guess I am too honest and blunt for business-minded thinking… I wouldn’t be disrespectful towards my superiors but I do believe in making a stand in what you believe in. I’m a “black or white no gray areas” kind of guy. I know that in the business world that isn’t “professional” but I suppose that is where I stand on these issues… And the way I see it, if they are asking me to do something dishonest, even though it isn’t illegal; I’m not 100% sure I would want to work for them anyways!
October 26th, 2009 at 10:28 am
In HR our role is to advise and counsel. Sometimes people make decisions that might be unethical but not illegal. You need to decide where your line is. However, if someone asks you to commit an illegal act, you can refuse to. You might still get fired, but at least you some form of defense. But, that is easier said than done if you think your career is on the line.
October 26th, 2009 at 10:59 am
Eventually, everyone will be faced with a “less than best” scenario or an outright dishonest or illegal one. Ethics is not a varying characteristic, if ethical, it will be known, if just a “don’t get caught” character, this will be known as well.
The best formula to avoid requests for unethical conduct is to establish a reputation for ethical conduct early. Don’t yield to intimidation and be willing to sacrifice employment, promotion, or other such to retain your ethics. In light of this persona, you will either avert attempts to gain your alliance in unethical conduct, or begin the venture for more ethical employment sooner than later.
I have had such confrontations and my response is the same: I may not have authority to dictate company policy or action, but I will and do retain authority to refuse to participate or be affiliated with such conduct.
Amazing perhaps to some, the matter was dropped and the proper course of action engaged. Either I awakened them to the risks, or they felt my contributions outweighed the desired gain from the inappropriate action requested.
Frankly, which is irrelevant to me, either way, my integrity was preserved, and the potential consequences to the corporation avoided. Honesty remains the best policy.
Imagine, what if the request had been a test of my character? consenting would have brought a doubly adverse result.
October 26th, 2009 at 11:02 am
Rebecca – my work just did one that promoted team building, fun and talking.
We were given a bag of big marshmellows and a bag of uncooked spaghetti and told to build a tower as tall as possible. We were able to have two measurements and the average of the two was the winner. We choose one mid way and the other at the end. Before measuring, the tower had to stand for 30 seconds and measurement was to highest marshmellow.
It was fun and a little messy/sticky.
Good luck!
October 26th, 2009 at 11:14 am
Hey Tim we are on the same team –Kudos to you —yes 1 4 1 don’t screw around being blunt is okay –
October 26th, 2009 at 11:18 am
sorry Steve in my world i put unethical on the same line as illegal — it all gets down to doing wrong, regardless of what any attorney says etc.
October 26th, 2009 at 11:29 am
Rebecca,
Not sure if you’d call this a game, but it would be an interactive session and give your group much to discuss.
Get copies of resumes/applications for last year (qtr or mth) by recruiter or group of recruiters with names removed, and have another group try an pick the best and worst applicant, who was hired/not hired from that bundle.
When you are done, you can compare (not challenge or non-constructively criticize) to actual hiring activity
You could do a similar exercise using only candidates actually hired and have groups identify (project) the best and worst subsequent performers.
The resulting comparisons and discussion will help identify strengths and weaknesses in resume/application review process (don’t let this get personal), common resume/application attributes of the good or bad performers, and an open cross-talk of personal tactics and perceptions based on resume/application information. For application based hiring, it may also help identify areas of improvement to your application itself.
You’ll note, I come from a philosophy that such ‘games’ should have a return on the investment. I.E. play for a purpose other than just fun.
October 26th, 2009 at 11:35 am
I also answered 1, 2 (if 2 led nowhere – then 4) and 1.
Twice now I have been asked to do something I didn’t think was quite right and have been told there are no “xxxx” police that will come and get you.
I am not going to be timid when it comes to ethics.
October 26th, 2009 at 11:40 am
al gilmour,
Unethical vs. illegal is the difference between what “I” or another person deems appropriate, whereas, illegal is a violation of an established law.
For example, some might think it unethical to discipline my child by taking away a cell phone for a month, yet no law prohibits such. However, beating my child is both unethical and illegal.
I do not impose my individual ethics (personal viewpoints) upon others acting within their given authority, but do draw the line when I am asked to act therein. I do enforce established corporate ethical standards regardless of my personal viewpoint on the matter, whether I might believe it to be too strict or liberal. I hold myself accountable to my standards only as they exceed (more restrictive) corporate standards, otherwise I adhere to at a minimum to the corporate standard.
You’ll note in my initial post, cowardice is not my nature.
October 26th, 2009 at 11:49 am
Rebecca,
Here’s an idea for you… My company concentrates on training in improvisation and communication skills. Here is an exercise that teams have a great time with and also stimulates conversation. I don’t know the specifics of your company but you’ll get the idea. I think that team building games can be rolled into discussions then honed into great ideas and put into action.
This exercise is fun, interactive and stimulates discussion about any topic you choose.
A) World’s worst. You can get teams together in large or small groups. Tell them that they are going to present the World’s Worst presentation on how to (i.e.) solve patient malpractice lawsuits, World’s Worst candidate interview, etc. (Each team should present the worst possible way to solve this problem.) The results are hysterical and a great way to break out of the norm.
There are a lot of these kinds of exercises. Please contact me if you would like to discuss further – I am always happy to help and would love to establish relationships with those in the healthcare field.
Thank you,
Forest Guider
http://www.improvconsulting.com
forestguider@improvconsulting.com
October 26th, 2009 at 12:44 pm
Most of us whom have either taken the quiz honestly (lol) or read the scenarios and answers, are those who sit in higher positions and/ use experience and a greater level of evaluation towards these answers. Most of you may have found yourself thinking back to when you may have entered a company as a Jr. Exec or in a Newbee role. Perception is measured differently with everyone, but facts are facts, and in a court of law, facts will out weigh judgement and perception.
We need to remember to use ‘good’ judgement and exercise due dillegence when determining best practices for our employers. As HR Professionals we are often placed in advisory positions, which require compromise yet decisive answers as to which way Management should go in deciding what is legal and compliant. If we do not practice ethical goverance and sound business adherance what good is the role we serve for the organization.
Many personnel are challenged with small and large decisions weekly, that could have a positve or adverse result on the company. However, we need to consistently encourage personnel to be proactive, make decisions based on how they would want another individual in that position to respond, empower them to tell the truth from a business persepective (removing emotionally bias opinions) and provide factual evidence to support the argument or action.
All things considered, any given person could have went a combination of ways in choosing the best avenue to solve each scenario. I always encourage Executive/Management Team to think first, if more than one option/side weigh the lesser of them, and then make a decision; however, be ready to flex and change if facts/proof prove to be detrimental with initial response. You should look at the corporate culture and provide a basis that puts each decision in a better position than its initial. Above all remeber to use Integrity.
Just my 2 cents.
October 26th, 2009 at 1:05 pm
I find that most people have no clue as to how to define what is “ethical.” In the early 90’s people were called “unprofessional”, but today we call them “unethical.” Some define it by their “gut” feelings about a decision (I will know it when I see it). Some define it by the rules of ethics, like a pre-legal system. We live in a time of “situational ethics” where any manner of poor behavior can be explained away and rationalized.
There have been some excellent comments on this blog concerning exercises to explore ethical thinking and decision making.
One point I would like to make is that you can’t distinguish a behavior as ethical or not through simple observation. Some people do the “right” thing because they are not aware of any other options or by accident.
I find that ethical decisions involve not breaking faith with all the associations you might have. For instance, I have found that some people have very strong family and community ties and they would betray their company, co-workers, and country if it came down to a choice between a family member and another. Some have very strong religious ties and they would betray family, friends, and country to hold true to those beliefs. Still there are others who have strong personal and professional ties and they would betray everyone to hold true to those standards.
It’s not always a “no brainer” and sometimes involves doing the least harm. We don’t celebrate and reward ethical behavior. It is expected from every group and association we belong to. When we fall short, we get punished.
A Dr. Kohlberg discussed the process of moral development more than 30 years ago and identified three stages; Conformity, Choice, and Concern for others. He identified that they were largely impacted by the community surrounding the individual. For instance, in a small close-knit community moral development seems to stay at “Conformity.” In large impersonal communities the moral development can develop to “Choice.” And finally, in communities where the people in authority communicate that they truly care, then the highest level of moral development “Concern for others” can develop. So I guess, more that the rules and who is breaking them, if the leaders in our community do not make it a point to communicate their care and concern, we will be stuck with the situational “what’s in it for me” choice stage.
October 26th, 2009 at 2:45 pm
Mike R: YOU ARE RIGHT! Most people have no clue as to how to define “unethical”. From my own experiences, being honest and blunt has gotten me into a few precarious situations. In my opinion, it is an outrage to think that standing your ground when it comes to right and wrong(no gray areas with me either) could be considered anything other than honest and upstanding. You would think that these are the people that companies would want as employees, but I think they see us as future problems.
October 26th, 2009 at 4:26 pm
I agree with Al Gilmour…unethical will equate to illegal. As far as what government and private practice does…it is comparing apples to oranges. WE all tend to forget that our elected officials, from the County Commissioner to the President all make pledges and promises they cannot necessarily keep. The majority rules. So, whatever promises they make, the majority rules. I would like to think that corporations choose to operate even more principled than government. They have a clear choice. The scenarios presented, although optimistic, are probably far from what actually happens. Most people operating on a “junior” level are going to preserve “self” first. Junior level executives are merely inching their way to the top. They, for the most part, do not have enough “juice” to squeeze anyone higher than they are.
October 26th, 2009 at 4:58 pm
Tim and Al, I answered the same as you. 1-4-1. I have been put in these situations and I don’t let anyone influence me to do something that I find unethical. I don’t care how important the person is that I am talking to, they must own up to their own behavior. If I am asked to do something unethical, I just say I won’t and why. I am not nasty or condescending. I just take the right stand and live with it. Once you start compromising your ethics, you are on a slippery slope. In HR, your reputation is everything. Once tarnished, it is hard to recover.
October 27th, 2009 at 8:20 am
Rebecca:
Fellow southeastern Michigan HR Manager here. Is your “year end review” a year-end recap on how they did, improvements for next year kind of session?
Feel free to email me off list for ideas.
~ Sheryl
sheryls@fiveonline.com
October 27th, 2009 at 9:34 am
Sande,
Why so quick to excuse government for unethical conduct? It is not unethical to “fail” in pursuit of ones goals. It is unethical to lie and misrepresent yourself as having a particular goal, while not genuinely willing or interested in pursuing it. A politician’s failure to meet a campaign promise, is not unethical, unless such failure is either due to failing to pursue or not actually holding the values related to the goal expressed. (false advertisement – lying to gain voters)
Unethical and illegal are not synonyms! For a politician to lie about his/her intentions is unethical, but not illegal. If you cannot prosecute for it (this includes official fines such as speeding tickets), it is not illegal. We do have scenarios arise in which unethical conduct was involved which identifies or results in the introduction of new law to make such conduct illegal, but the two are not the same.
Another example, it is unethical for siblings to be more interested in gaining control of the assets of their aging parents (for their own benefit), but in many cases can do so legally in spite of the unethical nature of such conduct.
If you limit your ethics to merely what is lawful, I would limit my trust in your conducting business of any nature on my behalf. It’s akin to a child exceeding the evident guidance of the parents, and arguing, “you didn’t specifically say I couldn’t” even though the child knew the parent would not approve. Unethical, but not specifically illegal (violation of a formal law)
As for your comment that comparing government to private business is like comparing apples to oranges, I agree in the contrast, yet not in your conclusion from it. Government set rules for others and itself, and willfully enforces them while not applying those same rules to themselves. Businesses must heed the laws established by government, their own policies and principles of business and the industry. Oddly enough, in more cases than some would care to admit, businesses must choose which government rule to ‘break’ as such rules may conflict with each other. If there is a place where ethics should be the easiest, it would be government. After all, what’s the worst that can happen from being lawful and ethical; not getting re-elected. If that’s the outcome, we should not be surprised at the absence of ethical and law-abiding politicians.
October 27th, 2009 at 1:50 pm
Amen to that MKH!!!
October 29th, 2009 at 8:55 pm
I agree with Tim; 1, 4, 1. You should have the same rules for yourself at work and at home. It’s time for the government and the business world to remember honesty is always the right way to go. If it had been the ruling way, we wouldn’t all be in the mess we are in! Our forefathers kept God in the equation; so should we.