In the 2008 movie The Dark Knight, the Joker made a very thoughtful observation when he said "You see, their morals, their code, it's a bad joke. Dropped at the first sign of trouble." (Warner Bros. Inc. Entertainment)
Was he talking about the fraud and misconduct of our day? Are there any moral superheros in today's organizations? Who has the most influence?
Study says "No"
In 2000, KPMG began conducting an annual integrity survey to highlight changes and attitudes in the workplace. Sadly, the survey continues to reveal that in spite of all the transparency demanded by society, it looks like there are many improvements to be made.
In the most recent study, KPMG reported that 73 percent of employees have personally observed or have personal knowledge of misdeeds in their organizations over the past 12 months while 56 percent said that the actions observed could potentially create a serious loss of public trust. The industries with the highest "performance" were the automobile industry, government, and the banking and finance industry.
Now, one may argue that all it takes is a mandate from executive management to invoke changes in an organization's practices and culture. In reality, however, it appears upper management contributes significantly to the problem. Pressures, incentives, inadequate resources, and job uncertainty are all major drivers of fraud and misconduct.
The following highlights some of the challenges voiced by employees:
- 64% of employees feel pressure to take whatever action needed to achieve business targets
- 59% believe that results are rewarded in spite of the means needed to achieve them
- 57% say they lack resources to accomplish their job without cutting corners
- 59% say they fear losing their jobs if they do not meet their targets
(Note: These figures are on the rise.)
Fortunately, whistleblower mechanisms are improving, as 53 percent of respondents said they would feel comfortable using a hotline to report misconduct, up from 44 percent when KPMG first conducted the survey. However, only 59 percent believed they would be protected from retaliation, and 49 percent said they would be satisfied with the outcome were they to report the misconduct to management.
What Can Be Done?
The most positive takeaway from the study, though, is that ethics programs and compliance programs have a favorable impact on employee perceptions and behaviors. In companies with ethics and compliance programs, 82 percent of employees felt motivated and empowered to do the right thing, compared to only 43 percent of employees who worked in companies without ethics and compliance programs.
Based on these statistics, it seems that employees are only as good as their employers allow them to be.
If employers emphasize strong ethics, then overall employee integrity rises. If employers pressure their employees for results at any cost, then integrity decreases. There is a clear causal relationship between responsible management and employees motivated to do the right thing.
Executive management must make good choices and put them into action if employees are going to be enabled and motivated to do what's right.
Note: This article and the opinions expressed here are from Russ Warner, VP of Marketing at Converus, makers of EyeDetect, an innovative deception detection technology.