Monday, August 10, 2009

In my book, Lessons From Prison, I frequently use the terms “values-based decisions” and “corporate codes of ethics”. Briefly, allow me to share a few thoughts on these subjects.

Making values-based decisions helps assure that all my decisions are rooted in honesty and integrity, consistent with the principle of good citizenship. When evaluating my own moral or ethical dilemmas, I have trained myself, through repetition, to ask a series of questions: Will my behavior mislead anyone or conceal truth? Could I justify my decision to my unborn child whom I would want to consider me a man of honor? Would I mind if my friends and family read about my behavior in the Los Angeles Times? Been there, done that! I encourage my readers to ask a similar set of questions. Decision making and reasoning at this level helps guarantee that you will never engage in behavior that could bring pain and shame to those love and support you.

Corporate codes of ethics: Most are useless and are written in a bureaucratic tax code that few can actually understand. Having trouble sleeping? Go read your companies ethics statement. Moreover, most organizations fail to integrate the stated precepts anyway. Without question, an ethical code starts at the top, and the leaders of the organization have a duty, an obligation to ensure that the codes are more than some platitude posted on a wall. If a code exists it ought to be taken seriously, and employees should be held accountable. ALL EMPLOYEES. This is where it gets tricky. For example, it’s easy for CEO’s to say they will hold every one accountable for unethical behavior. But will they? What if the person acting unethically is your largest producer, and a good portion of your company’s revenue is tied to their performance? Double standard? Most of the time yes, and there in lies the problem. The code becomes a joke the moment management fails to hold that employee accountable. I encourage companies to avoid publishing corporate codes until they are prepared to actually implement them. My former employer UBS had a corporate code of ethics; they also tacitly encouraged the pursuit of short term profits, consequences be damned. The unique or uncommon CEO, in my opinion, rewards an employee that receives a thank you note from a client, just as much as he rewards the employee that closed a $100,000 sale. This approach builds trust and collaboration enabling everyone to work towards the stated goal of the company. To often bottom-line thinking, together with the pressure to perform belies the ostensible mission of the company, which should be to put clients first.

So in summary, if you are a business owner, or have employees that are subordinate to you, I encourage you to look inward. Namely, do you convey a message of transparency and honesty? Do you say one thing and do another? Does the employee that refused to fund a loan for the unqualified client still get the company Laker tickets even though their actions failed to generate a commission? Do you recognize that employee for his uniqueness and right-mindedness? To lead effectively these questions should be answered. If your answers don’t coalesce and work in unison with your posted code, find the courage to change. Or don’t have a code at all. Never forget your employees are watching and learning from you as the captain of the ship.

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