Three questions every HR professional must ask
There is a growing sense of urgency among business leaders to establish some kind of defence against corruption. However, there is also an increasing realization that laws are not enough. It has become painfully clear that no amount of legislation can guarantee protection against the threat of workplace corruption.
There is no doubt HR has a vital role to play in the battle for workplace integrity. The starting point for fulfilling this responsibility requires asking three critical questions.
Is ethics an important consideration in selection and recruitment efforts?
Recruiting and selecting the right employees, particularly into managerial positions, is one of the most important factors in corruption-proofing a workplace. Organizations are typically aware of the costs associated with bad hires (such as training, termination and replacement) and tend to search for talent on the basis of key competencies.
Unfortunately, organizations are much less likely to screen employees on the basis of core values and ethical disposition. Yet, the costs associated with unethical hires can be much greater. Unethical behaviour can cause enormous damage to an organization’s reputation and employee morale, resulting in loss of revenue and even organizational decline.
Moreover, consider the secondary effects as people tend to mimic others’ behaviour. Unethical behaviour tends to create more unethical behaviour, particularly when it is displayed by the talented employees and those in leadership positions. Such individuals should be role models for ethical conduct for other employees.
Here are some suggestions for HR practitioners to consider to ensure they’re evaluating candidates from an ethical standpoint before making a hiring decision:
•consider using standardized psychological testing for evaluating candidates’ integrity;
•develop situational/behavioural interviews that tap into candidates’ attitudes and approaches toward ethical dilemmas; and
•consider conducting background checks, which can be done quickly and inexpensively in-house or by using a third-party service.
Do policies and incentives unintentionally encourage unethical behaviour?
Unethical behaviour does not always stem from corrupt individuals, but can occur because of a system that inadvertently encourages unethical conduct. Well-meaning designs can often have unintended side effects. Could the performance appraisal and compensation systems in place encourage corrupt behaviour?
Consider the following. Organizations prefer to set hard, measurable goals — the old “what gets measured, gets done” — such as growing sales by three per cent or reducing costs by five per cent. Performance systems are designed to support these objectives. Yet this is often done without much consideration for ethical implications. Companies often do not account for situations where a conflict occurs between attaining measurable goals, which are directly tied to one’s career, and softer ethical considerations.
HR professionals need to be vigilant in monitoring for ethical dilemmas, and they need to be prepared to offer guidance and support to properly manage such situations. HR professionals should ensure practices, policies and systems align with both the organization’s strategy and the organization’s ethical objectives.
Suggestions for HR practitioners:
•Critically review existing internal policies and incentive systems: Do they in any way encourage unethical behaviour?
•Create performance measures for ethical behaviour and regularly reward employees who conduct themselves in accordance with the organization’s espoused values.
•Implement performance appraisals that incorporate values-based outcomes as well as numeric-based outcomes and recommend promotions for employees who demonstrate ethical conduct.
Does the corporate culture truly reflect the company’s values?
Organizational culture can have a powerful impact on employee attitudes and actions. As a tool for ethical management, HR professionals need to know what kind of messages the corporate culture is sending to employees.
In too many companies, organizational culture discourages whistle-blowing and can even make unethical activities seem to be an acceptable part of doing business. This destructive dynamic can feed on itself and spiral into a moral meltdown. The result is more lawsuits, theft, fraud and damage to reputation.
HR professionals should keep their fingers on the ethical pulse of their company. There are several indicators that can be used to measure the level of ethics integration within the company:
•board/senior management oversight practices and charters;
•code of conduct awareness and signatures;
•ethical culture surveys of employees’ opinions;
•helpline awareness and call resolutions;
•training records and effectiveness ratings;
•risk management and early detection; and
•degree of ethics message integration.
In order to help assess the ethical dimension of corporate activities, more and more companies are turning to ethics audits. These audits can reveal whether different segments of the organization are fulfilling the organization’s stated values. An ethics audit can measure a variety of factors, depending on what the organization deems to be relevant to its ethical culture and business needs. The audit process itself can raise awareness among employees of the importance management places on ethical conduct and personal integrity.
Suggestions for HR practitioners:
•Continuously assess the ethical component of organizational culture via surveys, open forum staff meetings, one-on-one discussions, ethical hotlines and focus groups.
•Facilitate open communication, such as focus groups, for employees to disclose and discuss issues related to unethical conduct in the workplace. Provide assurances to employees that they can voice any ethical questions without fear of reprisal.
•Provide training for ethical decision-making, starting with the senior management team and continuing down through the rest of the organization. Continue to communicate the ethics message after training to ensure long-term success.
Answering the three questions: An important strategic challenge for HR
There is little doubt HR continues to take on more strategic roles in organizations. There may be few other areas that require an HR leadership role more than the management of workplace ethics. HR professionals need to be prepared to become ethics champions.
The time is ripe for all HR professionals to ask themselves the three questions. If these questions have never been fully addressed, there’s no time like the present to begin the process.
The fundamental practice of HR is just as much about ethics management as it is about people management. The HR profession is ultimately concerned with bringing out the best in people. There is no better way to accomplish that than by becoming an ethics champion for the organization.
Len Karakowsky is professor of management at York University in Toronto and author of Corruptible, a new book that looks at the battle for workplace integrity. He can be reached at (416) 736-2100 ext. 66237 or [email protected]. Igor Kotlyar is a Toronto-based designer of simulation-based assessments for industrial and consumer use. He can be reached at [email protected]. Robin Grant consults on strategic HR issues and teaches at Kwantlen University College School of Business in Surrey, B.C. She can be reached at [email protected].
There is no doubt HR has a vital role to play in the battle for workplace integrity. The starting point for fulfilling this responsibility requires asking three critical questions.
Is ethics an important consideration in selection and recruitment efforts?
Recruiting and selecting the right employees, particularly into managerial positions, is one of the most important factors in corruption-proofing a workplace. Organizations are typically aware of the costs associated with bad hires (such as training, termination and replacement) and tend to search for talent on the basis of key competencies.
Unfortunately, organizations are much less likely to screen employees on the basis of core values and ethical disposition. Yet, the costs associated with unethical hires can be much greater. Unethical behaviour can cause enormous damage to an organization’s reputation and employee morale, resulting in loss of revenue and even organizational decline.
Moreover, consider the secondary effects as people tend to mimic others’ behaviour. Unethical behaviour tends to create more unethical behaviour, particularly when it is displayed by the talented employees and those in leadership positions. Such individuals should be role models for ethical conduct for other employees.
Here are some suggestions for HR practitioners to consider to ensure they’re evaluating candidates from an ethical standpoint before making a hiring decision:
•consider using standardized psychological testing for evaluating candidates’ integrity;
•develop situational/behavioural interviews that tap into candidates’ attitudes and approaches toward ethical dilemmas; and
•consider conducting background checks, which can be done quickly and inexpensively in-house or by using a third-party service.
Do policies and incentives unintentionally encourage unethical behaviour?
Unethical behaviour does not always stem from corrupt individuals, but can occur because of a system that inadvertently encourages unethical conduct. Well-meaning designs can often have unintended side effects. Could the performance appraisal and compensation systems in place encourage corrupt behaviour?
Consider the following. Organizations prefer to set hard, measurable goals — the old “what gets measured, gets done” — such as growing sales by three per cent or reducing costs by five per cent. Performance systems are designed to support these objectives. Yet this is often done without much consideration for ethical implications. Companies often do not account for situations where a conflict occurs between attaining measurable goals, which are directly tied to one’s career, and softer ethical considerations.
HR professionals need to be vigilant in monitoring for ethical dilemmas, and they need to be prepared to offer guidance and support to properly manage such situations. HR professionals should ensure practices, policies and systems align with both the organization’s strategy and the organization’s ethical objectives.
Suggestions for HR practitioners:
•Critically review existing internal policies and incentive systems: Do they in any way encourage unethical behaviour?
•Create performance measures for ethical behaviour and regularly reward employees who conduct themselves in accordance with the organization’s espoused values.
•Implement performance appraisals that incorporate values-based outcomes as well as numeric-based outcomes and recommend promotions for employees who demonstrate ethical conduct.
Does the corporate culture truly reflect the company’s values?
Organizational culture can have a powerful impact on employee attitudes and actions. As a tool for ethical management, HR professionals need to know what kind of messages the corporate culture is sending to employees.
In too many companies, organizational culture discourages whistle-blowing and can even make unethical activities seem to be an acceptable part of doing business. This destructive dynamic can feed on itself and spiral into a moral meltdown. The result is more lawsuits, theft, fraud and damage to reputation.
HR professionals should keep their fingers on the ethical pulse of their company. There are several indicators that can be used to measure the level of ethics integration within the company:
•board/senior management oversight practices and charters;
•code of conduct awareness and signatures;
•ethical culture surveys of employees’ opinions;
•helpline awareness and call resolutions;
•training records and effectiveness ratings;
•risk management and early detection; and
•degree of ethics message integration.
In order to help assess the ethical dimension of corporate activities, more and more companies are turning to ethics audits. These audits can reveal whether different segments of the organization are fulfilling the organization’s stated values. An ethics audit can measure a variety of factors, depending on what the organization deems to be relevant to its ethical culture and business needs. The audit process itself can raise awareness among employees of the importance management places on ethical conduct and personal integrity.
Suggestions for HR practitioners:
•Continuously assess the ethical component of organizational culture via surveys, open forum staff meetings, one-on-one discussions, ethical hotlines and focus groups.
•Facilitate open communication, such as focus groups, for employees to disclose and discuss issues related to unethical conduct in the workplace. Provide assurances to employees that they can voice any ethical questions without fear of reprisal.
•Provide training for ethical decision-making, starting with the senior management team and continuing down through the rest of the organization. Continue to communicate the ethics message after training to ensure long-term success.
Answering the three questions: An important strategic challenge for HR
There is little doubt HR continues to take on more strategic roles in organizations. There may be few other areas that require an HR leadership role more than the management of workplace ethics. HR professionals need to be prepared to become ethics champions.
The time is ripe for all HR professionals to ask themselves the three questions. If these questions have never been fully addressed, there’s no time like the present to begin the process.
The fundamental practice of HR is just as much about ethics management as it is about people management. The HR profession is ultimately concerned with bringing out the best in people. There is no better way to accomplish that than by becoming an ethics champion for the organization.
Len Karakowsky is professor of management at York University in Toronto and author of Corruptible, a new book that looks at the battle for workplace integrity. He can be reached at (416) 736-2100 ext. 66237 or [email protected]. Igor Kotlyar is a Toronto-based designer of simulation-based assessments for industrial and consumer use. He can be reached at [email protected]. Robin Grant consults on strategic HR issues and teaches at Kwantlen University College School of Business in Surrey, B.C. She can be reached at [email protected].
