Ethics Training - How to Incorporate Ethics into Your Business

Ethics are important to any organization, big or small. Not only can it help ensure that companies stay out of legal liability, but it also ensures that all employees can work together harmoniously (Kastner, 2016). Businesses that ensure that they avoid unethical business practices will additionally be able to foster a good reputation for their business, and thrive in their community, while also steering clear from any potential costly litigation (Kastner, 2016). Additionally, the importance of the impact on employees and the organization, is training employees ethically will help shape the organization for future success (Deloitte, 2018).

When it comes to ethics management and compliance programs, there are seven basic elements to consider according to Troklus and Couture (2022). What are the standards your company strives to uphold? What policies does your company currently have in place? What procedures is your company required to abide by? What will your compliance program administration look like? Who will ensure that the company is in compliance of ethical dilemmas? Who will communicate the ethical procedures, policies and standards set forth with the rest of the company? Who will train employees on the ethical procedures, policies and standards set forth? Who will monitor and audit the company for ethical compliance? What will your internal reporting system look like? Will someone manage this alone? Will it be a team? What does the discipline for noncompliance of the code of ethics look like? Will you terminate immediately, or does it include discipline of loss of wages, administrative leave without pay, up to and including termination? What will the investigation process look like, and what are remediation measures to ensure any breaches in ethics are recovered and made right?

There are a variety of things to consider when you begin setting up a code of ethics. Not only training on it, but creating the very structure that will house your ethical standards and keep the company in compliance going forward as well.

Once you had addressed the previous questions about who will be responsible for the training, who will monitor for compliance, and who will keep up with the changing times and ethics all in one… you now can focus on what are reasonable considerations for an ethics training program.

First, you will want to identify your need for training (Hansen, 2019). There are a variety of topics for ethics that need to be discussed regularly, however, you will want to establish a solid auditory program to be able to assess the areas which need the most attention for ethics training. Your company could establish a blanket ethics training, however, that would not be able to address all of your employee’s questions. Employees will commonly have questions associated with specific actions and will want to know in specific situations. For example, “If I run into a situation where I see my manager, that is also my neighbor, not disclosing all of the money in the till who would I report that to? And would it be confidential?” Ethics training is not a one-and-done solution, thus ethics “may need to be reinforced in a variety of situations over time as your industry changes,” (Hansen, 2019).

In order to train your employees, you must first understand what your employees need. You know, however, that what they don’t need is “a lecture on how to be a good person,” (Hansen, 2019). It is important to have open discussions about what-ifs, or role-playing tricky situations, but it is also extremely important that employees also understand the law associated with compliance and how those laws relate to them (Hansen, 2019). That is one of the most important aspects of any training, is making it relatable to the employee receiving the training. If they do not have it applicable or relatable, they may believe that it does not apply to them, thus they may feel as though they don’t need to learn that information.

Involvement: Your leadership needs to stand behind your ethics and behind the training that is being rolled out; if leadership does not fully support the training or changes being implemented, then it may send the wrong message to employees that they do not need to take this training as seriously (Hansen, 2019). Having an ethical management team, as we discussed previously, will greatly impact the leadership has on the rest of the organization. For instance, ethical managers can meet weekly or bi-weekly with management to ensure that everyone is consistently on the same page, and the same information is being relayed to the rest of the organization.

Incentives: Hansen (2019) suggests offering gift cards, half days, or other small bonuses to employees who fully commit to the implantation of ethics in the workplace. This could look like employees who see something unethical and report it right away. Or maybe an employee witnesses something unethical taking place… for example, another employee is taking materials and putting them in her purse. This employee could step in and ask for the employee to put the merchandise back on the shelf.

Common goals: When everyone is on the same page, it makes driving the ship a lot easier to manage. If everyone knows their role, and everyone knows their purpose behind the mission then it makes the ship sail a lot smoother. Articulate your company culture, get leadership involved, and create a unified company identity (Hansen, 2019).

Engagement: Make the training fun! Ethics can be a scary topic, full of laws and compliance, and sometimes just downright boring for some employees. Employees can also give a significant amount of pushback on ethical training as well (Hansen, 2019). However, if you implement role-playing, games, or just ice breakers occasionally to lighten the mood… it changes the way that employees think and thus shifts their attitudes about ethics from negative to positive (Hansen, 2019).

Seriousness: While it is great to have fun with the training, there will be points in time where it is not as much fun and you need to really drive home the implications for not taking the training seriously. If you want your employees to “represent your company with respect and consideration, functioning as a team where everyone is appreciated, supported, and heard, you need to take this type of training seriously,” (Hansen, 2019).

One possible avenue to ensure that ethics is properly relayed across the organization is to integrate ethics into your company culture, and everyday activities (Mann, 2022). Mann (2022) states that from the very beginning of hiring an employee, asking ethical related interview questions, outlining the companies values during the onboarding process, job related ethics training during the onboarding process, and also ensuring that ethical conduct by all employees is a regular part of performance evaluations will be the best way to ensure that your company creates an ethical workplace. It will become not so much just a training that employees take, but it becomes the way that people think and work, and it becomes second nature to assess situations for ethical implications. Creating an award system, or a star system, where employees can recognize each other or nominate each other for ethical practices can help foster a system of ethics.

Within this type of system, it becomes less about the training of the ethics, and more about allowing employees to grow and learn within the company. Employees need to feel as though they are allowed to make a mistake, and they need to feel comfortable to admit when they messed up (Mann, 2022). This culture of a very well rounded ethical workplace will “cultivate psychological safety by admitting their own missteps, regularly soliciting feedback from across the organization, and proactively reminding employees that ethics is a learning process,” (Mann, 2022). Ethics is not something that can be learned overnight, nor should it take a backseat throughout the rest of the month when training is not in session. “There’s evidence that more-ethical companies have happier employees and do better in the market,” Mann (2022) quotes Maryam Kouchaki.

By changing the way that the employees and leadership process ethics in your workplace. It will take significant work, lots of hours in training, and mental shifts for current employees. The main changes that will need improvement, are currently procedures and policies. These procedures and policies will need to be adjusted in accordance to apply to ethical standards. Once those changes have been implemented you must then provide mental wellness training, to ensure that employees are fostered in a community that promotes humility. “It is important to help workers understand that unethical workplace behavior is not simply the result of a few bad apples, but that all of us are susceptible to moral failures,” (Mann, 2022).

Not only will this ethical training include the do’s and don’ts of what not to do, but it will also include information on types of situations where people have most commonly gone astray, and the types of justifications used when they commit those types of infractions in ethics (Mann, 2022).

Training can additionally cover topics such as, “Would I feel comfortable if my reason for doing this appeared on the front page of a newspaper?” “What would happen if everyone behaved this way?” or “Will I be proud of myself for doing this?” (Mann, 2022). Teaching and implementing the publicity test is a great way to foster an environment where employees turn internally to assess for ethical standards as well. Then ethics become not only business-related but also become personal and people may feel a stronger desire to remain on the side of ethical standards.

Promoting culture and environment where employees can grow and learn from mistakes as well as successes can promote ethical business standards. Implementing “postmortem meetings when important projects end,” (Mann, 2022) can be great way to wrap a project and discuss things that they wish they had done differently or are proud of and why they are proud of it.

Allowing employees opportunities for moral growth can additionally significantly promote an ethical business environment (Mann, 2022). Ways that employees can volunteer for different community-related projects can help employees overcome selfishness, and develop social responsibility by promoting an outward focus (Mann, 2022).

The mode in which the training will be delivered is by everyday business practices. Incorporating ethics into job interview questions, employee performance evaluations, volunteer opportunities, and a positive culture designed to allow mistakes to occur, as well as promoting psychological safety by promoting humility in the work environment will implement ethics in everyday business activities. This will not simply be a one and done training, it will encourage ethics in every single thing that an employee does.

The frequency in which training should occur is every day. But the training is what is engrained into the business and the culture of the business. However, having group meetings or even employee performance evaluations to discuss ethical standards and processes is ideal. As laws and compliance requirements change it is important for employees to stay up to date on this information. Employees should be updated and trained on all legal and compliance changes and requirements every 6 months, supervisors every 3 months, and managers every 6 weeks (about 1 and a half months). Managers receive the most updates so that as small things come out, they can update their employees and let them know what is coming. However, lower-level employees will receive training more spread out to ensure the training they receive covers everything they have been learning over the last 6 months and it will essentially be a platform to open the door to questions about why a process is being done the way that it is.

SHRM Foundation is the #1 resource suggested for review. SHRM is a reputable Human Resource Management foundation that specializes in all things relating to ethics, human resources, legal requirements for businesses, and compliance for employees, managers, supervisors and more (Meinert, 2014).

The Harvard Business Review is the #2 recommended resource when creating an ethical workplace. An article by Epley and Kumar (2019) specifically lays out recommendations for designing an ethical organization. This resource will discuss methods in how to lay out a company’s values, what the pillars of an ethical culture are, incentive programs, and more.

Michael Kallens, published by Nasdaq is an Associate General Counsel at the Nasdaq’s Office of General Counsel and is a Senior Member of Nasdaq’s Global Ethics and Compliance Team. His article titled, 5 Key Components for Building and Maintaining an Ethical Workplace Culture (2019), could have great success with helping your business maintain the ethical standards for your workplace once implemented.

HCCA is a Healthcare Compliance Association, and they offer many ways to understand the implications for not incorporating ethics into business practices.

Additionally, the BERC, Business Ethics Resource Center, has many great resources for implementing an ethical culture. Listed in the resources is a link to the article titled, Creating an Ethical Organizational Culture by Steve Nguyen, 2016.

While the resources listed previously and on the next slide will highlight the risks associated with not implementing proper ethical standards, policies, and procedures it is good to address them directly as well. When employees do not feel safe, supported or otherwise well they will not be happy, productive, or properly trained which can lead to high levels of employee turnover. If your management are not trained on ethical workplace standards, they will be ineffective at implementing discipline requirements, and more. The need for ethics in the workplace has never been more needed than when employees are unhappy with their current work environment (Amo, 2019).

References

Amo, T. 2019. The Negative Effects of a Lack of Training in the Workplace. Chron. https://smallbusiness.chron.com/negative-effects-lack-training-workplace-45171.html

Deloitte. 2018. Getting Ethics Training Right for Leaders and Employees. Rick & Compliance Journal, The Wall Street Journal. https://deloitte.wsj.com/articles/getting-ethics-training-right-for-leaders-and-employees-1523246538

Epley, N., and Kumar, A. 2019. How to Design an Ethical Organization. Harvard Business Review. https://hbr.org/2019/05/how-to-design-an-ethical-organization

Hansen, M. 2019. 8 Ways to Develop More Effective Ethics Training for Employees. eLearning Industry. https://elearningindustry.com/ethics-training-for-employees-ways-develop-effective

HCCA. 2022. Building an Ethical Culture: Why It’s Vital, How it’s Done. HCCA. https://www.hcca-info.org/store/product-detail?cvid=003_ETHCUL

Kallens, M. 2019. 5 Key Components for Building and Maintaining an Ethical Workplace Culture. Nasdaq. https://www.nasdaq.com/articles/5-key-components-building-and-maintaining-ethical-workplace-culture-2019-04-01

Kastner, N. 2016. The Importance of Ethics Training Programs. University of North Georgia. https://blog.ung.edu/mba/the-importance-of-ethics-training-programs/

Mann, R. 2022. 5 Research-Backed Strategies for Building an Ethical Culture at Work. Kellogg Insight. https://insight.kellogg.northwestern.edu/article/building-ethical-culture-at-work

Meinert, D. 2014. Creating an Ethical Workplace. SHRM. https://www.shrm.org/hr-today/news/hr-magazine/pages/0414-ethical-workplace-culture.aspx#:~:text=In%20the%20SHRM%20Foundation%20report,treatment%20of%20customers%20and%20employees.

Nguyen, S. 2016. Creating an Ethical Organizational Culture. BERC. https://www.businessethicsresourcecenter.org/creating-an-ethical-organizational-culture/

Troklus, D., and Couture, S. 2022. The Complete Compliance and Ethics Manual 2022. COSMOS, Navigate the Compliance Universe. https://compliancecosmos.org/essential-elements-effective-ethics-and-compliance-program-0