Ethics without borders

A policy of borderless ethics can build and maintain excellent levels of trust with stakeholders

For an organisation to be perceived as ethical it would need to earn, build and maintain a sound ethical status or rating. However, exploring what constitutes being ethical across different industries or across companies operating in different countries all too often gives rise to the response that “ethics is different for different circumstances”. Certainly the globalised nature of the world of work particularly makes for a multitude of differences in the workplace. Yet, ironically, globalisation also makes the practice of the same ethics all the more valuable, not least for the clarity it offers affected parties and the fairness it embodies by operating in terms of the same ethical criteria. The practice of operating in terms of the same ethics coupled to the constancy of ethical conduct reflects an approach of “ethics without borders”.

To realise a situation of borderless ethics, organisations need to surface and focus on the apparent ethical differences in their workplace. This is best explored in terms of the primary factors that shape ethical behaviour, particularly values and rules.

In a given context, there would normally be common applicability of national laws and industry rules and regulations. There are also increasing similarities in legislation between countries, such as laws addressing bribery and corruption. For example, in South Africa this is addressed by the Prevention and Combating of Corrupt Activities Act and the Companies Act, the UK has the UK Bribery Act, and the US has the Foreign Corrupt Practice Act and the Sarbanes-Oxley Act.

However, there are many countries that do not have adequate legislation or satisfactory legal enforcement. The best solution to this problem is a combination of an understanding of the relevant country’s legal system, a commitment to abide by the law in what ever country one operates and a commitment to operate in terms of the best standards applicable within the organisation. This specifically avoids following lower legal standards where inconsistent or inadequate legislation permits it – which risks encouraging a lowest common denominator approach and eroding the company’s ethical standing.

Another source of ethical differences can arise between personal values and norms and those of the organisation, which can undermine the ideal of aligned personal and organisational values and norms. Since the individual’s values are affected by a variety of factors (including upbringing, culture and the behaviour of personal role models), it can translate into employees bringing a wide spectrum of values to the workplace, ranging from perfect to appalling. While those with perfect values should be celebrated and leaders should actively strive to align all employees behind the company’s values, this should not include accommodating individuals’ poor values within the context of the workplace.

The argument that the interpretation of the organisation’s values can also differ has very little substance. Core moral values such as honesty, fairness or respect that are exercised in an ethical manner (which means they are applied equally to stakeholders and without variation) do not lend themselves to a range of different behaviours. A difference, however, that can occur is the way the values manifest themselves in practice. A good example is respect. While respect would undoubtedly enjoy overwhelming support from most organisations and individuals, people differ in the way they express it. For example, is it respectful to look at one’s superior directly when being addressed or should one lower one’s eyes? The answer depends on factors that include the individual’s culture and the prevailing company culture. The key issue is to recognise that the value is shared and to expose and explore the different expressions of the value as a route to achieving agreement on what is appropriate within the context, goals and environment of the organisation.

Cultural norms can also give rise to differences. In a global context, the business practice of giving gifts is one example. Whereas in China and other Eastern countries this may be the norm, in many Western countries gifts and personal perks are classified as bribes and are often subject to a zero tolerance approach. There is no one easy solution for this clash, but a combination of transparency, discussion and respect can be effective. This includes, for example, focusing on customers that have similar values and being aware at the outset of business dealings of this potential area of difference. For those companies where bribes have become common practice, it is best to actively avoid doing business with them: the cost of complicity in misconduct is unlikely to warrant the potential benefits of the business.

Clearly, therefore, ethics without borders is not without its challenges. The benefits, however, exceed the challenges. A policy of borderless ethics can build and maintain excellent levels of trust with stakeholders – including amongst shareholders, employees, customers, suppliers and investors – which, in turn, can enhance a company’s reputation and ethical status. Leaders therefore need to equip themselves with an understanding of the flaws in arguments against borderless ethics to effectively deflect them.

By Cynthia Schoeman
Published in HR Future, November 2013