The famous pianist Arthur Rubinstein was asked to judge a piano competition, and the contestants were to be graded on a scale of one to 20, the most gifted receiving the higher number. Rubinstein listened intently and personally gave each contestant a grade.
On examining the scorecards marked by Rubinstein, the event sponsors were aghast to discover that most of the students had received zeros and only a few received 20s. There were no intermediate scores. Shocked, they asked Rubinstein to explain himself.
His answer was: “It is simple. They can either play the piano or they cannot.”
Similarly, there are no intermediate scores when it comes to business ethics. We can’t afford to take a less-than-ethical view of our responsibilities as businesspeople and as individuals. And we can’t afford to settle for anything less in those we do business with and certainly not in ourselves.
Martin Luther King Jr. said, “The time is always right to do what is right.”
When I speak to corporate audiences, I introduce my lesson on ethics by saying, “Always act like your mother is watching.” Let’s face it, there has been a consistent, gradual decline in ethical business practices in the United States for the last 50 years.
To explore how ethical standards have declined in business, it’s important to consider various factors and trends that have influenced this perception, such as pressure for short-term gains. Many businesses face intense pressure to deliver short-term financial results, often at the expense of long-term ethical considerations. This can lead to cutting corners or engaging in questionable practices to meet financial targets.
Then there is globalization and complexity. As businesses expand globally, they encounter diverse regulatory environments and cultural norms. Navigating these complexities can lead to ethical lapses if not managed carefully.
And don’t forget technological advancements. Rapid technological changes can outpace regulatory frameworks, creating opportunities for unethical behavior, such as data privacy violations or misleading digital marketing practices.
The many high-profile corporate scandals have tarnished the reputations of entire industries and contributed to a perception of declining ethics. These incidents often highlight systemic issues within organizations.
In some cases, there may be insufficient mechanisms for holding individuals or organizations accountable for unethical behavior, leading to repeated violations.
Changes in societal values and expectations can influence perceptions of what is considered ethical. Businesses may struggle to keep pace with these evolving standards.
Australian businessman Kerry Stokes said: “Ethics or simple honesty is the building blocks upon which our whole society is based, and business is part of our society, and it’s integral to the practice of being able to conduct business, that you have a set of honest standards. And it’s much easier to do business with someone when you look them in the eye and say, ‘This is what we’re going to do,’ and you understand what you each mean, and you can go away and get it done.”
Dealing with ethics in business is crucial for maintaining a good reputation and ensuring long-term success. Here are some key strategies to handle ethics effectively:
Establish a clear code of ethics. Create a comprehensive code of ethics that outlines the values and principles your business stands for. This document should serve as a guide for decision-making and behavior within the organization.
Lead by example. Leadership should model ethical behavior consistently. When leaders demonstrate integrity and ethical practices, it sets a standard for the entire organization to follow.
Foster an ethical culture. Encourage an environment where ethical behavior is valued and rewarded. Promote open communication and provide channels for employees to report unethical behavior without fear of retaliation.
Provide training and resources. Offer regular training sessions on ethical practices and decision-making. Equip employees with the tools and knowledge they need to handle ethical dilemmas effectively.
Monitor and enforce ethical practices. Implement systems to monitor compliance with ethical standards. Address violations promptly and fairly to maintain trust and accountability within the organization.
Engage with stakeholders. Maintain transparency and engage with stakeholders, including customers, employees and the community. Listening to their concerns and feedback can help identify potential ethical issues and address them proactively.
Evaluate and adapt. Regularly review and update your ethical policies and practices to ensure they remain relevant and effective in a changing business environment.
In business, ethics isn’t just about doing what’s right; it’s about building a foundation of trust that leads to lasting success.
Mackay’s Moral: Knowing what is right doesn’t mean much unless you do what is right.
