Management needs to walk the talk

Management needs to take a stronger position against corruption and unethical behavior and really walk the talk. We also need to keep the conversation on ethics going. That was the message from the panelists in the webinar “Rationalising corruption – how can understanding it help counter corruption?”. The webinar was arranged by Nordic Business Ethics (NBE) and the Swedish Anti-Corruption Institute (IMM).

Niina Ratsula, co-founder of NBE, was the moderator of the webinar. She introduced by asking the question “Why don’t we behave at work?” which then was discussed from different points of view.

Anna Romberg, Executive Vice President Legal, Compliance & Governance at Getinge and ambassador and co-founder of NBE, started with explaining that there are always two elements.

– There is somebody that is breaching the ethical standards or doing something illegal and then there is the bystander who is not reacting or doing anything about it, she explained.

According to the ”2020 Nordic Business Ethics Survey” 62 percent do not intervene when witnessing unethical or illegal behavior. Anna informed that depending on the role in the organization the explanation to why the person did not intervene when witnessing something unethical differed. People in the top management stated that they did not consider it relevant. Line managers answered that they did not consider it their business. Employees replied that they did not think that it would make any difference whether they reported or not.

Wiley Wakeman, behavioral scientist, said that especially during crises people tend to not intervene. The reason is that they often have so many things to handle at that time.

– When people are saying they didn’t jump in and get involved perhaps what they are saying is I had so many fires to fight at this point in time and I didn’t thought that this was a big deal, Wiley elaborated.

He also reasoned that humans want to belong to groups. Also, people have a strong loyalty to the groups that they are in.

– Often people are put in situations where they are forced to choose between right vs right decisions. One hand is honesty, and the other hand is loyalty, he continued.

Anna developed this by telling that according to the ”2020 Nordic Business Ethics Survey” employees seems to feel that they shall be loyal to the line manager.

Natali Engstam Phalén, Secretary-General at IMM, briefly presented the findings in the report conducted by IMM on rationalisations used by convicted bribery offenders in Sweden (“Tio förklaringsmodeller bakom mutbrott”, only available in Swedish). According to the report, two explanation models dominate. First, was to blame someone else, for example by saying that the line manager had approved. Second, to claim that it was a misunderstanding.

Natali also pointed out that in the ”2020 Nordic Business Ethics Survey” it becomes visible that lack of leadership is a big problem. She also said that there seems to be contradictions because top managers stress the importance of ethics the most. Yet, when looking at who is involved in unethical actions at the work place according to the survey as well as a recent OECD study, the management is to blame.

– We have the talk, but we don’t have the walk, Natali stated.

Anant Modi, Partner at Forensic Risk Alliance, said that passive leadership or leadership that contradicts corporate values can drive poor company cultures.

– It has the potential to be very corrosive in an organization, almost encouraging bad behavior. That tone from the top really has a part to play, he continued.

To the question what should be done in the future, Anna had a clear request.

– Not a general code of conduct, please, she said.

A general code of conduct is of course a start. But the code of conduct must be specific for each company. Also, all employees and managers needs to know what it really means, she developed.

You find a recorded version of the webinar here.