Design your code for colleagues who are ethically competent allies, willing and capable to participate in shaping and safeguarding your organization's ethical values.
Define your user
When you get started designing an Ethics Code, the first question you need to answer is this: Who am I designing this code for?
My advice: Design your code for colleagues who are willing and capable to participate in shaping and safeguarding the organization’s ethical values. If you want to design a code that people read and support, then addressing your employees as ethically competent allies is the most important design decision you can make.
Conventional code design
This might sound counterintuitive to some ethics and compliance practitioners. And indeed, when reading the codes of many companies, I get the impression that they were written with potential delinquents in mind.
First-generation codes typically follow this script:
A welcome statement from the CEO (“tone from the top”) reminds employees that “all company employees are required to abide by the Code of Conduct.”
The main section of the code addresses a range of compliance topics (e.g., use of company assets, anti-bribery, etc.) and instructs readers about verboten behaviors (e.g., “Employees must never offer bribes.”)
A zero-tolerance statement reminds employees that employees who violate the Code will be “subject to disciplinary action, up to and including termination.”
A chapter on speaking up encourages employees to ask questions and report suspected misconduct.
The delinquent code users
These points have one thing in common: They all address employees as people who might act unethically. The script conveys that management distrusts employees’ ability to behave ethically.
Research findings: Please talk nice to me
Different lines of research in psychology indicate that the conventional script is unlikely to engage employees (see research based on Reactance Theory, Self-Determination Theory, and Self-Affirmation Theory). According to this research, we respond defensively when we feel that our competence and self-integrity are questioned or that our behavioral freedom is diminished by coercive regulations and threats of punishment. As a result, our intrinsic motivation to enact the requested behavior will suffer, we will attempt to extricate ourselves from the situation, or even enact behavior opposite to the one requested (an effect known as reactance or oppositional defiance).
Simply put: A code that addresses employees as potential delinquents is unlikely to invoke a positive response from employees. Rather, we may expect that many of them will dismiss it as irrelevant to themselves or respond to it with cynicism. If we want our colleagues to listen to what we have to say, we need to speak to them respectfully.
The road paved with good intentions
An oft-cited study on corporate sexual harassment programs by Frank Dobbin and Alexandra Kalev found just that: When sexual harassment training addressed trainees as potential wrongdoers, it was associated with increases in retaliation and a reduction of women in management positions. When, by contrast, the training treated trainees as women’s allies and gave them practical intervention tools, it was followed by increases in women managers.
Reality check
Is it true, though, that employees are an organization’s most valuable asset for safeguarding its ethical values? Let me cite a few data points:
A recent survey conducted by Bentley University and Gallup indicates that U.S. employees have high expectations when it comes to businesses’ ethical business performance; at the same time, very few think that businesses are good at it.
A survey conducted annually by the Association of Certified Fraud Examiners has found consistently that tips are by far the most common way fraud is detected, and most tips come from employees. Tips by far exceed audits or other detection techniques (e.g., internal audits, surveillance).
The 2021 Global Business Ethics Survey, conducted by The Ethics & Compliance Initiative, found that 86% of U.S. employees who observed misconduct reported it. And they do so despite a significant risk of retaliation. 79% of U.S. employees reported retaliation in response to reporting wrongdoing.
These data points remind us that many employees feel a commitment to ethical values and are willing and capable to defend them.
Your reader is your ally. Empower them
Activating, supporting, and strengthening the ethical capacities that already exist within the organization is vital for keeping ethical risks in check. Therefore, when drafting your ethics code, think of your readers as your allies. Write your code for employees who share your commitment to ethical values. Assume that, above and beyond complying with common sense ethical requirements, employees are willing and able to participate in shaping and safeguarding your organization’s ethical commitments. The purpose of the code then is to provide the information and tools they need to competently and safely participate in this task. The challenge in front of us is not to instill ethics into people but rather to elicit the ethical social capital that is already available.
Practical tips for designing a code for ethics allies
In a few brushstrokes, what would be the script of a code that is written with ethically competent readers in mind?
Tone from the top: In its welcome statement, senior management takes a role-modeling posture. It articulates its own commitment to conducting business in an ethical manner. It commits to an ethical business purpose that delivers value to all stakeholders. Senior management encourages employees to speak up and accepts full accountability for protecting those who speak up from retaliation.
Ethical commitments: The code should express the organization’s ethical commitments in an aspirational fashion. Purely mandatory, rules-based language such as “All employees must comply with all safety laws and regulations.” doesn’t cut it. Instead, behavioral guidance on safety requirements should be rooted in a genuine care for everyone’s well-being. This makes it easy for readers to identify with and support the behavioral requirement.
Practical guidance: The code should not only enumerate verboten behaviors that employees should abstain from. It should also provide guidance on proactive actions employees can take to safeguard ethical commitments. For example, when discussing anti-harassment, a code might encourage employees to check in with anyone who has been harmed by harassment and offer support. It is informal but visible gestures in the everyday lives of employees that sustain the ethical fabric of an organization.
Speak-up culture: When addressing speak-up, the code shouldn’t simply compel employees to ask questions or denounce suspected misconduct. Employees have many valuable prevention- and improvement-related insights as well. The code should encourage employees to speak up about any ethical risks and hazards they encounter in their daily work, and to share their ideas for mitigating them.
The competent code user
What do all of these points have in common? They all address employees as moral agents who can make a positive contribution to shaping and upholding the organization’s ethical values. If you want to write a code that employees read, that they feel inspired by, and that they will use in situations where the organization’s ethical values are at risk, then addressing them as ethically competent allies is the most important design decision you can make.
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