Conclusions — Lessons From The Past
The final chapter provides some insights and observations from the case studies presented in this book.
Insights Regarding Overall Corporate Behavior
The ethics of top executives permeate an organization, for better or for worse. The CEO is the model, and his behavior trickles down to the next tier, then the next, and so on. In many instances, the decisions made at lower levels are influenced as much (or more) by whether they will be acceptable to their superiors than whether they are ethically sound.
Emphasis on short-term goals often generates situations in which ethics are compromised for the sake of expediency. The author does not recommend that practical matters be toned down, but that ethics remain a criterion of success.
Top management is ultimately responsible for the actions of a company, regardless of where the decision was made. This is especially true when the media gets hold of a situation, and top management is called to answer. Passing the blame to a subordinate is not an acceptable excuse.
Copying the practices of others is not a substitute for ethical evaluation, nor is doing things the way they have always been done.
Attempts to cover up are invariably found out. A company that ignores information provides to it, destroys reports and communication, or attempts to deny conversations may delay the discovery, but the impact will be worse when they are found to have been dishonest.
Attempting to do things on a dramatic scale - extreme cost-cutting, rapid expansion - an often lead to dramatic mistakes and compromised ethics.
Ignoring problems on a small scale, as single critic or an incident that affects a small number of people, may be ignoring the seeds of a much larger problem, and your dismissal of it at a small scale will be seen as a failure in preventing a large-scale disaster.
Public image is important for corporation. Customers, shareholders, vendors, and partners are members of the public, and even if they are not directly impacted by the action of a company, they will be aware of the impact and distrustful of the firm.
Do not underestimate the power of the press or the legislature. Even if you have cultivated positive relationships with them, their support is fleeting, and can turn on a dime.
As a sidebar, the author mentions that new employees to a corporation are often a barometer to the morality of the culture - the more uneasy the feel about business practices, the more those practices merit scrutiny. As a new employee, clues to look for are: being told that something is being done "just this once" for expediency's sake, that something is OK because no-one will know about it, that it doesn't matter how things get done, that certain things are common industry practice, that there are active attempts to hide things (shredding documents, denying conversations), that "no one will get hurt", that others are considering heir own personal gain, etc.
Insights Regarding Specific Operational Aspects
Safety is a particularly sensitive issue: whether the results are intentional or not, any action that harms the customers, employees, communities, or the environment is a lightning rod that draws both litigation and public scrutiny.
Price decisions, including both the price you charge your customer and the price you negotiate with a supplier, can draw fire if they seem collusive or exploitive.
The behavior of U.S. firms that operate or sell overseas is held in close scrutiny, both abroad and domestically.
Final Insights
Groupthink is perhaps the greatest cause of unethical behavior in organizations. In some instances, all it takes is for one person to raise a red flag (and in many instances, others who were hesitant to speak up will chime in). The same is true outside of the organization: one citizen, one activist, one employee, one journalist, is often the drop of rain that breaks the dam.
The climate has shifted to one of protectionism - the consumer, the employee, the community, and the environment must be carefully considered, because in any instance where a company is accused of doing harm, sentiment is pre-loaded against the company. The days of caveat emptor are past.
Adversity need not be forever. Environmental conditions will change and fluctuate. More importantly, any incident that harms the company can be handled to lessen its impact and longevity.
Establishing a trusting relationship can help a company through the rough patches. If you have a positive relationship with customers, communities, employees, and others whom it touches, it will be easier to earn their forgiveness, provided that your mistreatment ro negligence does not become a pattern that sets the tone of the relationship.