How Can You Persuade CEOs and Boards That Ethics Are Crucial for Success?

How to Convince a CEO or Board of Directors That Ethics Are Vital to the Organization

To persuade a CEO or Board of Directors about the importance of ethics within the organization, it is crucial to demonstrate the tangible benefits that ethical practices can bring. By highlighting how ethics can enhance the company's reputation, build trust with stakeholders, and ultimately lead to long-term success, you can make a compelling case for prioritizing ethical considerations in decision-making processes.

Additionally, providing real-life examples of companies that have suffered reputational damage due to ethical lapses can help illustrate the potential risks of neglecting ethics. Overall, framing the discussion in terms of both risk mitigation and opportunity for positive impact can be persuasive in gaining buy-in from top leadership.

Don't. It is not the job of employees to educate the CEO. I am being realistic and not sarcastic. Yes, you may provide feedback that the present practices are unethical, but be very careful about the manner of your feedback.

Dear Colleagues,

There is nothing like having high business ethics in our different business environments.

The Role of the Board and Employees in Upholding Ethics

Basically, the Board of a Company is responsible to the Regulatory Bodies of their countries when they err or go wrong in their dealings. It is the duty of the employees to complain to such authorities. For instance, in cases of tax evasion, you can call the tax authorities to investigate such matters.

Addressing Unethical Practices

When a CEO decides to offer or give a bribe to get a contract/bid and you, as an HR person, are aware, it is left for you to bring it to his knowledge that "people can only win by righteousness."

These things might sound out of this world, but we need to start doing the right things locally and globally as well. Not so far away in our recent past are Enron and Andersen. In as much as I want to avoid mentioning names, these two are in the global public domain, so I am forgiven.

Promoting Fairness and Standards

Furthermore, even in our respective internal business environments, we should try our best to be fair to all employees by having standards and keeping to such. What can help us achieve this is by publishing and releasing to staffers, Employee Handbooks that state without any ambiguities what their rights are and their limitations as well as the Company's Board.

Educating Leadership on Ethics

By extension, the CEO/Board should be tutored on business ethics and the long-term effects on their company and image. They could be getting away with such immoralities and unethical dealings, but the word nemesis does not exist for nothing—it would someday, somehow, somewhere catch up with them.

Let me just rest my submission here by saying that we should draw a line between legality and morality.

Cheers,

Afolabi Ajayi

Hi! Although business ethics is now a universal subject, I would like to believe that its actual application and implementation in corporate premises is still largely cultural in trait and dimension, if not vague and "metaphysical."

Code of Business Ethics vs. Code of Discipline

I have seen companies with specially formulated Codes of Business Ethics, aside from their handbook's Code of Discipline. Although both are similar in intent, the target client seems to be different in some organizations. The Code of Business Ethics tends to apply more to managerial and executive employees, while the Code of Discipline applies to supervisory and rank-and-file employees.

Ethical Dilemmas in Ownership

However, I am not sure whether these materials apply to the owners and shareholders of the company. To me, this is where the ethical dilemma comes in. Maybe, in publicly listed companies, where shares are controlled by many stockholders, the level of professionalization and ethical practices can be increased.

Challenges in Family and Closed Corporations

In family and closed corporations, the owners normally play the role of gods and goddesses. Ethical practices would sway with the level of morality and professionalism they would want to see in their companies. Small fries must dance and sway with them. Anyway, they are the ones accountable to regulating bodies in their respective places of business operation.

Crusaders in family and closed companies may not find themselves in a good work environment if they campaign against the wishes of their corporate gods and goddesses.

Best wishes.

Ed Llarena, Jr.

Managing Partner

Emilla Consulting

Business Ethics

The CEO is responsible for implementing/driving the business ethics throughout the organization. You must not just present the code of ethics to the CEO, but sell him along with the benefits. Secondly, when you sell, sell him along with an action plan for implementation. Just telling as a piece of philosophy will not help your case.

Regards,

LEO LINGHAM

Business Ethics: It is one of the interesting topics to look into.

Ethical acts become ethical when they are considered as such in the environment around us. Once, it was considered bad to attract customers from other companies as unethical. But as the business environment changed, trying to attract other customers also became ethical. So, not only the CEO of the company is responsible for this. The environment around him will determine what he considers ethical and what he does not.

Why do you want to do that? Are his activities unethical? I agree with Mindskill - don't talk about ethics to an unethical person, especially if he or she is rich and powerful. The "shoot the messenger" principle is likely to be applied. You need to decide how long you're going to stay there and how involved you will be in the CEO's decisions.

Ideally, the CEO should be the one to teach and promote ethics. I read somewhere that it is very difficult to teach ethics to anyone past the age of 10.

Hi,

I totally agree with the point of view that trying to convince a CEO who is a believer in unethical practices would be an exercise of beating one's head against a wall. Only you would come out bleeding, and the wall will not budge.

Having said that, you could probably just give examples of companies that were once considered as blue-chip companies but have now perished (e.g., Enron) or whose value has faltered over the years due to their unethical practices.

You could also give examples of how being ethical will add immense value to the goodwill enjoyed by the company, thereby increasing your standing in the market or even your market share price value. There are numerous American examples of the same, wherein empirical studies have been conducted showing that ethically run companies have performed better than the ones that were unethical. Indian examples could be Tata's or Infosys.

I'm not sure if it could really bring about a change in your CEO's mindset, but one can always try.

All the Best!

Warm regards,

Anjali

Dear Friends,

Good day to you.

The question of convincing a CEO of the need for ethics in business sounds amusing. Business houses - whether small, medium, or large - are started with a purpose in mind. Most of the time, wealth maximization is the end goal.

It is in the way that this goal is achieved that makes one company different from the other. Companies that have withstood the ravages of a changing time, economy, political environment, etc., are the ones that have their base on values and high ethical standards.

Standard Operating Environment (SOE) is what is 'acceptable' inside the company, and many times this becomes the norm or culture of the company. Before endorsing this norm or culture, the company management should ponder upon what kind of image it portrays of the company to both internal and external stakeholders.

More recently, even the government machinery is gearing up to introduce laws governing ethical standards (you must have heard about Clause 49). Thus, companies that want to have a future need to foster - preferably by choice - a culture that encourages high ethical standards.

Some of the ways of doing this would be through a standard Code of Conduct, policies like Whistleblower, Sexual Harassment, etc.

Balaji Ganapathy
Human Resources
TATA Consultancy Services Ltd.

Entrepreneurial orientation for employees is the global solution for these futuristic and forward-thinking organizations in this regard.

Goodbye for now,

Kriskumar S
Chennai, India

My email: kriskumars@yahoo.com

Can anybody please post an article on how to deal with ethical dilemmas in HR? Please help me out. It will be useful for me to include it in my 100 marks project.

Thanks, Amala