In 2004, I created a business/workplace ethics consulting practice which I called “EthixBix,” with its own website at “ethixbiz.com” (now inactive). This was primarily a local San Francisco Bay Area, sole proprietor operation whose slogan was “Building Ethically Healthy Organizations for Excellence and Success in a Diverse, Global Marketplace.” The name was a kind of spin-off from Ethix Magazine, which I co-founded and co-led with Al Erisman, based in Seattle, from 1998-2003 (www.ethix.org is still online as a wonderful trove of interviews and articles under Al’s amazing leadership these past twenty years). I published an e-zine I called the “EthixBizine” and archived it and a number of “Tools” and resources at the site to help large- and small-business leaders eager to upgrade their approach to organizational ethics. Before long there were 1700 on our mailing list—from among the hundreds of MBA students I taught as well as my consulting clients and others I met in my speaking gigs on the topic. When I ceased publishing the e-zine in 2010, I passed our distribution list over to Ethix Magazine which continued to serve that audience as I moved on a full-time faculty post at Gordon-Conwell Theological Seminary in Boston.

Studying busines ethics was a part of my PhD work at USC in the 1970s and, while my primary field was theological, Christian ethics, I taught business ethics courses every year from 1980 onward at New College Berkeley and North Park University, along with several visiting gigs at Regent College and Seattle Pacific University. Back in the Bay Area after 2001 I taught several courses for San Jose State and the University of San Francisco. Most of these courses were for graduate and MBA students. Then from 2004 to 2010 I was full-time professor of business ethics for MBAs in the St. Mary’s College Graduate School of Business. During the 1990s I began some ethics consulting work, helping organizations develop their ethics statements and training programs. This became a significant part of my work from 2002-2010 with extended service to Nikon Precision, Paradise Foods, the East Bay Municipal Utilities District, and for six years Harris & Associates Construction and Project Management.

So the approach I developed was not just from studying the literature and learning from ethics experts and business veterans but from “working in the trenches” with companies. Out of this came my book It’s About Excellence: Building Ethically Healthy Organizations (2008). This book is where you can find the fuller presentation and explanation of my approach, which I continue to believe provides the “best practice” basics for organizations in all industries and professions.

You can click on several tools and essays below for more details but here is the basic outline of what I learned, promoted, and practiced. I call this “Busines Ethics 2.0” to call us forward. Three basic themes drove my approach.

From Damage Control to Mission Control

Most business ethics books, courses, and consulting/training programs focus on hard cases (dilemmas and quandaries) which could led to legal problems and/or public scandals and then to financial disasters. The challenge then is to identify the problems and wrong-doers, analyze what went wrong, eliminate the problem, and control the damage. While this is all essential, of course, it doesn’t address the underlying causes. It is reactive, narrow, and negative. It tries to contain the “disease” but does not provide a positive guide to “health.” It relies on fear of consequences. My approach is to shift the major focus to a proactive quest for “ethical health,” with a stronger “immune” system. I call this “mission control” ethics. In business as in life it is about mission and purpose. Ethics becomes an account of how we need to treat each other (employees, customers, business partners, community, environment) in order to optimize out chances of succeeding with excellence in our corporate mission.

From Individualism to An Organizational Focus

Not just too negative and reactive, business ethics is often too individualistic (coming out of the modern European philosophical tradition). Symbolic of this is the common practice of requiring annual ethics training from individuals sitting at their computers tapping their way through individualized training modules. But ethics is a “team sport” not a “solo sport.” Ethical health requires collaboration, discussion, and mutual support, habits of talking and working together to get things right.

From Rules to Character and Culture

And conventional business ethics is too legalistic and rationalistic. The focus on rules limit attention to compliance with laws, regulations, and codes. But that is like a sports team just learning the plays without paying attention to conditioning and team-building exercises. If players are not in peak condition, they cannot run the plays. Rules and guidelines are important but individual character and team/corporate culture are even more basic. Actions matter but systems, policies, and culture cannot be ignored.

Six Components
in Ethically Healthy Organizations

When I teach business ethics or work with companies I argue that we need to pay attention to six components. I taught this in my MBA ethics courses and coached companies like Harris & Associates (construction and project management) in implementing it in the business trenches.

1: Motivation

It is easy, but mistaken, to assume that everyone is eager to work and manage in an ethical manner. Despite all the news stories and warning flags everywhere, many business people (and business students) remain apathetic, impatient, or unconvinced. But these attitudes are extremely dangerous, an invitation to disaster. To build an ethical, long-term, successful enterprise, everyone, from the board of directors through executive management to employees at all levels, must understand and embrace the strongest possible, most thoughtful and convincing rationale for taking ethics very seriously. Why should we—why must we—care about a sound ethics? What are the costs of ethical neglect? What are the benefits of sound ethics? Until this motivational challenge is addressed, little improvement can be expected.

2: Trouble-shooting

We mustn’t kid ourselves though. Even in the best of circumstances, hard cases and crises in business are going to arise. An exclusive emphasis on crisis-resolution, “damage-control” ethics is a mistake because it allows negative challenges and crises to set the ethics agenda and fails to move upstream to deal with the sources of these challenges. Nevertheless, ethical dilemmas and quandaries are inescapable and ethically-healthy companies must put in place a ready, effective trouble-shooting and crisis-resolution method.

3: Mission and Vision

What is the core purpose, the mission and vision of the company? Why do we exist? Where are we going? We focus so intensely on core mission because it is the mission that best leverages ethical behavior. An inspiring and shared mission and vision can mobilize people toward ethics and excellence. Each company must identify and articulate its own distinctive core mission, one that inspires people to bring their best, most ethical and talented selves to work each day. Without clear linkage to such a mission, codes of ethics become little more than abstract, arbitrary, boring legalisms. Ethical values and principles must be understood as integral aspects of all strategies and plans to achieve the company mission. I see the major role of executive leaders as “guardians” and heralds of the mission, encouraging and rewarding its embrace by all.

4: Culture and Values

Organizational culture refers to what the company “is” (not so much what it “does” in this or that circumstance). Culture is about context and capability. It has to do with the physical environment, the systems and policies, the kind of workers hired, and the informal habits and atmosphere. What are the characteristic traits, habits, and customs that define the organization? What is the style and atmosphere of the company? What are its virtues and vices, its characteristic potentialities, skills, and inclinations? Without a healthy “value-embedded-culture,” ethical decisions and practices are imperiled. Just as a physically-weak, out-of-shape sports team cannot successfully carry out even the most brilliantly conceived set of plays, so an ethically-weak company culture cannot live up to its stated principles and its code of ethics. Each company must identify and articulate the cultural values and traits that are essential to carrying out its particular mission. The culture must align with, and enable, the mission and vision. I see managers at all levels and in all departments as the primary culture builders and sustainers in an organization.

5: Practices and Principles

When a company has addressed its mission and culture, it is time to ask what the company specifically “does”? What are the basic work practices of the company? What are the primary activities, behaviors, and processes undertaken as the company pursues its mission and vision? Here is where companies need action-guiding rules and principles—often stated in the form of codes of ethics. Without robust, reliable “principle-guided-practices,” companies are liable to fail in their quest for excellence and wind up dealing with far more crises than necessary. When principles have a nice “fit” with basic business practices and activities, when they are clearly rooted in the company mission and culture, ethics is not experienced as an abstract, negative restraint but rather as a “set of plays helping us get into the end zone.” My approach is to mobilize the entire work force to craft an organizational ethics code or set of guidelines for workplace practices. This “wiki-ethics” approach gets both the wisdom and the ownership of that work force—infinitely better than something crafted by executives or outside consultants.

6: Leadership and Governance

As with anything of importance in an organization, gifted, effective leadership is essential in the ethics domain. If no one has the responsibility, the training, and the resources, the best ethics and values statements and ideals in the world will rest dormant and useless. Ethically healthy companies make sure that from the board of directors on down, throughout the whole organization, good ethics leadership is in place and in training. They strengthen and improve their governance systems and structures from top to bottom.

Four Crucial Processes
in Building Ethical Health

Attention needs to be given to the six “Components” at four points. This is not a once-for-all experience. All four processes must be revisited on a regular basis. Often, the place to begin is with a review of the company’s ethics experience and its current strengths and weaknesses (process 4 below).

1: Identification

At each of the six focal points—motivation, trouble-shooting, mission, culture, practices, and leadership—companies must identify what they have and are, and why it is important. This is a process of self-examination, identification, description, articulation, and explanation. A company has to “figure it out”—identify, describe, articulate the six components. Through study of company documents and statements, surveys, focus groups, interviews and discussion, the goal is to arrive at clarity and confidence.

2: Education

When the six components are clearly identified and articulated, the challenge is to ensure that they are known from top to bottom of the organization. Who are the target audiences and what are the particular emphases they must receive? (boards of directors, marketing, manufacturing, sales, customer service, executive leadership, human resources, new hires, veterans, et al). How should the ethical content be communicated and reinforced? (documents, coffee cup inscriptions, posters, classes and seminars, online and interactive information, awards, recognition, etc.). Companies must review and strengthen their ethics education programs with the goal of thorough knowledge throughout the organization. One concern to be noted here is the impact of the educational method on the learning. In particular, if ethics training is done primarily or exclusively to individuals sitting in front of computer screens, the trainees may be indoctrinated into (a) a highly individualistic approach that doesn’t know how to find the ethical wisdom of colleagues and teams, and (b) an arbitrarily neat notion of ethical dilemma resolution because of the incapacity of computer-based Q&A to represent the “gray” and ambiguous nature of real business ethics and the way we must try to responsibly “muddle through” at times.

3: Implementation

It is still not enough to identify and educate. The third process is to implement. Implementation means that the mission actually guides the organization. Activities that do not fall clearly within the mission are rejected. Core cultural values are not just identified but are expressed in everything from architecture to compensation and review. Principles are “on the table” when decisions are made. Dilemmas are routinely put through the resolution method. Any organizational values, principles, programs, and processes that are not clearly implemented will breed cynicism. Implement them or eliminate them. It’s about “walking the talk” and “practicing what we preach.”

4: Evaluation

The ethical health of organizations must be reviewed on a regular basis. How is the company doing on each of the six focal concerns? In each of the four processes? What are the areas of strength and weakness? What can be changed and improved? How can the ethics aspect of the business be kept fresh, alive, dynamic, and interesting? Individual employees need to be evaluated on their performance and contribution to the values and ethics of the company. The organization itself needs to be evaluated by its employees (and other stakeholders), often centering on a company values and ethics audit (review, assessment) tailored for each company’s particular needs and desires (longer or shorter in duration, this emphasis or that, etc.).