Over my twelve years as a business ethics consultant and Senior Fellow of the Ethics Resource Center it was my privilege to work with some 70 corporations as well as with the Ministry of Health of the United Arab Emirates. I worked with senior executives in drafting codes of conduct for more than a dozen large corporations including General Motors and Lockheed Martin. In addition to this direct work in description and evaluation of corporate cultures and the efforts to positively impact those cultures, I spent more than a decade managing clinical programs for general acute hospitals. Today I teach ethics to future health care professionals.
I share these otherwise irrelevant biographical details for the purpose of supplying context for the perceptions I have that may bear on Mr. Augustine's question. My experience has taught me that misconduct noted by survey participants is indeed misconduct, not infrequently serious misconduct, meaning misconduct that creates substantial and systemic harm to organizational performance, misconduct that may even threaten survival. So why don't ethics officers hear more about more serious misconduct? Two ideas suggest themselves. First, we should note that serious misconduct is indeed occurring. Second, I will offer observations with at least the potential to account for the lack of reporting.
Think of topics dominating the daily news, the "mortgage mess" and, in politics, "universal access" to health care. This week the Wall Street Journal on its editorial page detailed the fraud practiced by the states in billing for services that are ultimately reimbursed through the Medicaid entitlement program. Obviously, we don't need an ethical hero to "report" this misconduct to an "inspector general" or ethics officer, since it is being perpetrated in broad daylight, with the de facto consent of the victims' elected representatives. But there is no question that the activity is serious misconduct, misconduct that is nothing less than theft from the taxpayers and a contributory factor in the progressive deterioration of the financial feasibility of the Medicaid program itself. And you may be sure that the front line employees who prepare the cost reports that "justify" the reimbursements grasp the structural dishonesty of the process.
Similarly, over the years that loan originators and financial product designers extended ever more credit to ever less qualified borrowers, you may be sure they knew the activity was irresponsible, i.e., it represented a failure in their duty to act in the best interest of investors for whom they played a fiduciary role.
These two situations involving obvious unethical conduct could be multiplied many times over by tabulating only those actions that constitute violations of law that are caught and prosecuted.
Is it not more than likely, then, that other serious forms of misconduct are occurring that are not being detected, but that are known to involved individuals? I submit that it is.
Why do people not report these matters to ethics officers? Consider the two news items noted here. Is it so hard to understand why employees do not report other instances of misconduct, when they know that they themselves are engaged on a daily basis in institutionalized conduct that must be judged unethical? Why should they take the risk, if the institutions employing them are engaged in systematic dishonesty? It is not necessary to imagine that the implications of those perceptions rise to the level of consciousness, in order to suppose awareness of unethical conduct actually inhibits reporting of other similar conduct. My experience suggests that this is one important explanation for the paucity of reports of serious misconduct.
The second potential explanation I would propose is that, while the reasons certainly vary from organization to organization and situation to situation, employees do not report because they are convinced the ethics officer will not produce any positive impact or change. In many instances, that conviction probably arises out of the knowledge that senior management itself at least knows of, and perhaps participates in, the unethical conduct. It would be an act of extreme faith and optimism to suppose that unethical conduct at the highest levels would be eliminated if it were simply named unethical.
Any attempt to validate these speculations and others that might be identifed turns out to be exquisitely difficult. But it would be worth doing and one may hope that Ethos International will play a leadership role in adding this sort of understanding to our knowledge of organizational behavior.
Daryll Ward, Ph.D.
Kettering College of Medical Arts
Daryll.Ward@kcma.edu
