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Praise for The Ethics Challenge
Talk about timely! Organizations of all sorts, for proﬁt or not, exist for but one reason—to be of service. True service to oneself and one’s constituencies must be built on a basis of trust, truth, and transparency. Bob Stone and Mick Ukleja make this point brilliantly. Please read e Ethics Challenge. Please act on it. Your professional and family life alike literally depend on it. Bravo! —Tom Peters, “uber-guru of management” ( e Economist) Breaches of ethics seem to be so commonplace in the news today that it would be easy to think of ethical behavior as a thing of the past. But when you read e Ethics Challenge, you’ll see that ethics is alive and well in America. Bob Stone and Mick Ukleja have written an important book for today’s leaders. —Ken Blanchard, coauthor of e One Minute Manager® and Leading at a Higher Level Powerful, personal, and most important, relevant for today’s students of business and society. Stone and Ukleja clearly articulate what’s gone wrong and what we need to do, collectively and individually, to get back on the right ethics track. —Robert A. Eckert, Chairman of the Board and Chief Executive Oﬃcer, Mattel, Inc Bob Stone and Mick Ukleja have given us a lot to consider about ourselves. is book will enrich the lives of its readers and transform everyone around them to treat others as they wish to be treated. —George Deukmejian, 35th governor of California. e Ethics Challenge will change the way you think about your role as a leader and inspire you to follow your inner “ethical” voice. Its examples will help leaders strengthen their core ethical behavior and develop both personally and professionally. —Dr. Charles B. Reed, Chancellor, California State University System: 23 universities with 450,000 students
Retired Chairman.. It’s easy to read. Chamber of Commerce e Ethics Challenge brings virtue to life with stories and parables that should be read by everyone. F. author of Life Without Lawyers and e Death of Common Sense e Ethics Challenge is a broad exposure to thoughtful examples of everyday ethical situations. People from all walks of life can “strengthen their integrity in a greedy world” by adopting some of the many thought-provoking ideas contained here. and former President of the United States Conference of Mayors Bob Stone and Mick Ukleja present “the ethics challenge” in a powerful. Beverly Lewis O’Neill. Kanaga. President. —William S. Vice President and Deputy General Manager of Boeing’s 787 Dreamliner program Finally. and relate to. U. Ernst & Young. Howard. A moral compass is essential to a happy life and a healthy society. —Dr. easy-to-read manner that will certainly help practitioners of the art of leadership…as well as those that follow them. Long Beach . former Director. A must read for anyone who wants to succeed ethically in business (or life).. —James Kennedy. --Dr. and former Chairman. former Mayor of Long Beach. King Alexander. California. ethical leadership presented in commonsense terms that can change your behavior through self-awareness.e Ethics Challenge delivers a clear and simple message: merely talking about honesty and integrity is not enough. understand. We each have to walk the walk everyday. California State University. Kennedy Space Center e Ethics Challenge is an invaluable and very timely work that succinctly articulates the role of business.a must read! —Howard Chambers. education and civic leaders in fostering organizational cultures that promote high ethical standards.S. --Philip K.
City Manager of Ventura. CBS2/ KCAL9. is to cut corners and compromise rather than sticking to my own basic values. —Rick Cole. e Ethics Challenge provides me with a systematic strategy to follow my own good intentions. telling the truth. --Patrick McClenahan. Los Angeles Juvenile Court Judge and author of Juvenile Court: A Judge’s Guide for Young Adults and eir Parents Today more than ever. it seems that new. we need ethical leaders to set the example—to lead the way—to demonstrate in everyday situations what ethical behavior looks like. named one of Governing Magazine’s nine “Public Oﬃcials of the Year” As a leader in the mass media industry. Los Angeles With every high-level corruption case of a public oﬃcial. Mayor of Anaheim. e temptation. whether we recognize them as such or not. ese new laws may provide public oﬃcials cover for the indiscretions of their colleagues. Raley’s Family of Fine Stores . I have a commitment to continually strengthen the ethical climate of my organization. —Curt Pringle. Here is a thought-provoking book that provides a user-friendly GPS through many of these everyday dilemmas. President & CEO. but don’t make for more ethical elected oﬃcials. especially in tough times. more stringent and complicated ethics laws are passed to “prevent” any future public breach.Anyone who follows Stone’s and Ukleja’s advice will not only sleep better. e Ethics Challenge will help you become just such a leader. President/General Manager. former Speaker of the California State Assembly Fairness. As Stone and Ukleja point out. It is an invaluable tool to the leader who wants to make a lasting diﬀerence. ethical actions are personally inspired and are not found in ethics rules or laws. California. Krygier. they’ll help restore America’s character and capacity for greatness. integrity. and following the rules: every one of us routinely faces these types of ethical challenges. Our world needs this book! --Bill Coyne. A much needed book for our troubled times! —Leora G.
Using a combination of logic and examples.Peter Economy. In this important book. Associate Editor. and Visiting Professor. you need to read this book! —Jim Tunney. In today’s environment. I couldn’t help but reﬂect on my 31 years as an NFL referee and a like number as a teacher and school administrator. informative “read” that will motivate you to identify the “unenforceable set of rules” we each have inside us and then memorialize them for greater clarity and personal commitment. It is an intelligent. e question came to mind—What do others expect of me? e answer was clear: Just do the right thing! is book emphasizes how our intentions to do the right thing can be embodied by our will and our actions. Leader to Leader magazine As I read e Ethics Challenge. the authors clearly explain how to become a more ethical person and simultaneously build the ethical climate of your organization.e Ethics Challenge is a powerful reminder in these unsettled days that the basic value of doing the right thing never changes. Educator. Former NFL Referee. CEO. Not the Skill e Ethics Challenge ﬁlls a key niche in the marketplace of today’s society. morale and productivity will learn the value of talking about—and living out— ethical behavior. —Robert Lorber. Will you follow? -. CEO of Special Olympics Southern California is is a forceful book that is well written and easy to read. President. Astronauts Memorial Foundation e Ethics Challenge is an insightful and practical view by two exceptional leaders who understand the importance of ethics in both your business and personal life. —Stephen Feldman. University of California Davis Graduate School of Management . Any leader who wants to enhance an organization’s spirit. and then reaping the many beneﬁts! —Bill Shumard. Bob Stone and Mick Ukleja have set the course. and it is a beacon for others to follow. no matter what. e Lorber Kamai Consulting Group. and Author of It’s the Will. Ethical behavior is an essential element in long-term business survival.
White. Loyola Marymount University In the “shades of gray” smog of today’s ethical landscape. Bob Stone and Mick Ukleja provide illuminating examples of good people doing the right thing in diﬃcult situations. Chairman of e Bonita Bay Group . Hilton Professor of Business Ethics and Director. — David Lucas. e authors not only describe the “ethics challenge” each of us faces every day. It is even better to ﬁnd a book that identiﬁes these values and relates them to individual experience so that we may learn from the principles that are presented. Serving as a counterweight to the never-ending headlines that say that we live in a world of greed and self-interest. it is refreshing to ﬁnd someone who is willing to speak in terms of black and white.e Ethics Challenge is a hopeful and practical guidebook for anyone concerned with improving the quality of their lives. they oﬀer useful suggestions for the many ways—big and small—that we can make the world a better place. Center for Ethics and Business. — omas I.
The Ethics Challenge Strengthening Your Integrity in a Greedy World
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To all who taught us about ethics, most especially our children, grandchildren, and all the other young people who regularly test our assumptions, reject the status quo, and insist on integrity.
Six Actions for Meeting the Ethics Challenge: How to strengthen your ethical behavior and grow as an ethical individual and leader . . . . . . . . . . . . . . . 17 Part 2: Strengthening Your Integrity in a Greedy World . . . .Contents Dedication . . . 25 Part 3: Ethics at Work . . . . How Would it Look in the Paper? What is the relationship between appearances and ethics? . . . . . . . . . and what to do about it? . . . . . . . . . . 1 2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67 10. . . . . xv Part 1: Got Ethics? . . . . . . . . . . . Telling Truth to Power: How should one handle unwise or hurtful behavior by the boss or a friend? . . 57 8. . . . . . xix 1. . . . . . Obey Your Unenforceables: What rules of ethical behavior do you have. . . . . . . . . . 39 5. . . . . . . . . . . . . . . . . . 49 7. . . . . . . . . . . . . . . . . . . . . . . . 41 6. . . . . . and why can’t they? . . . . and how can you put them into practice? . . . 9 3. . . Cheaters Never Win: Why do people think they can win by cheating. . . . . Giving and Receiving: What are the ethical issues around exchanging gifts with people who are neither friends nor family? . . . e Ethics Challenge: Why is it that so many of the nicest people aren’t as ethical as they think they are? . . . . . . . . . . .xiii Closing the Integrity Gap . . . . . Impartiality: How impartial can we really be. 23 4. . . . . . . . . . . . . . . . . . . Ethics for Bosses: How should bosses balance their own needs against those of their people and their organization? . ix Acknowledgements . 73 xi . . . . . . . . . Breaking Rules: When is it ethical to break rules? . 63 9. . . . . . . . . .
. . . . . . Other People’s Money: When is it legitimate to gain beneﬁts from other people’s property? . . 91 14. . . . . . . . . . . . . . . . . . . . . . . . . . . or should they try to meet the special needs of each person? . . . . . . How You Play the Game: Is winning or losing more important than how you play the game? . . . . . . . . . .117 17. . . . . . . . Ethics and the Media: How does an ethical person deal with sometimes unethical media. . . . . . . . . . 77 12. . . What’s Fair?: Should organizations treat people all the same. . . 129 Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Lies. . . . . . . . . . Ethics in Politics: Do we put ethics aside when we think about politics? . . . 89 13. . . . . . . . . . . . . . . . . . . 131 About the Authors . and Shiny Shoes: When are we being deceptive. . . . . . . . Ethics and the Clergy: What should we do when our religious leaders preach the inferiority of others? . . . . . and when is it OK? . . . . . . . .107 16. . . . . . . . . . . . . . 83 Part 4: Ethics Around Us . . . . 141 xii . . .123 Appendix: The Three Theories of Ethics . . . . . . . . . . .11. . . . . and what is his obligation to be informed? . . . . . White Lies. . . . .101 15. 137 Notes . . .
associate editor of Leader to Leader magazine. We owe a lot to our super agent. Director of the Innovations in American Government Program at Harvard’s Kennedy School of Government. through Jeremy Bentham and Immanuel Kant. to writers and bloggers of the present.com as a platform to test some of our ideas. xiii . Roxane Stern has—as usual—been our best and toughest critic. Long Beach. judge in Los Angeles Juvenile Court. and to our friends who critiqued our writing. Jack Marshall (ethicsscoreboard. Leora Krygier.org). Krista Goering. and Michael Josephson (josephsoninstitute. She read every word and made countless suggestions for improvement. starting with Aristotle. com). and Peter Economy. who lent us his Management Insight series on Governing. including Rushworth M. We’ve been inspired by our work at the Ukleja Center for Ethical Leadership at California State University.Acknowledgements Anybody who dares to write about ethics owes a debt to all who wrestled with the subject over the millennia. and to Stephen Goldsmith. Kidder (author of How Good People Make Tough Choices: Resolving the Dilemmas of Ethical Living). which is promoting ethics across the entire university with its thirty-ﬁve thousand students.
or even cross it. we know how to do it. but we don’t do it. We know that good people with good moral values can grow ethically. Your authors believe this can change. ey can not only do a better job of choosing right over wrong. we inadvertently teach our young people that they’ll have to cheat to succeed.Closing the Integrity Gap American society is of two minds about ethics. On the other hand. faced with a tough choice. we know what we should do. is won’t happen using the traditional method of setting xv . but they can learn to see issues of right and wrong where before they saw only issues of tactics. we join lawsuits when we’re not injured. we tell pollsters that the one characteristic we admire most in our leaders is integrity. We tolerate— even sometimes admire—people who skate close to the boundary of ethical behavior. but sometimes. we sometimes display an integrity gap between what we believe and how we behave. We vote for politicians who lie. We have the moral intelligence to know right from wrong. When it comes to our own behavior. we root for sports ﬁgures who cheat. And worst of all. and our top business executives say that integrity is what they want most in the people they hire. we tolerate clerics who preach hate.
leading to ethical behavior that encourages others to behave ethically. from front-line worker to CEO. codes. We need to develop the ethical courage needed to follow our good intentions. We all possess ethical intelligence. regulations. Because of this conviction. and goals—things not bad in themselves—and then rewarding or punishing. whether in a company. is method makes no demands on the individual’s internal system of values. ey do this by focusing on internal values and motivation—that is. and it fosters behavior close to the boundaries. Long Beach (which Mick Ukleja cofounded). we are both deeply involved in the work of the Ukleja Center for Ethical Leadership at California State University. is kind of leadership transforms the culture from rule-based to ethics-based. e Center promotes ethical leadership at every level. and of society in general. depending on compliance. is is the ethics challenge. a social organization. or a family. It describes six things everyone can do to keep strong and prepared to follow their good intentions in the face of ethical challenges they meet everywhere. on ethics. of politics. from family unit to national government. Part 3 is Ethics at Work. of sports. structure. We believe that leaders can create values-based ethically driven cultures around themselves. Ethical leadership can transform the world of business.rules. Its mission is: Equipping people with the transformational power of ethical leadership. It shows how to recognize and deal xvi . Part 2 is Strengthening Your Integrity in a Greedy World. is book has four parts: Part 1 is Got Ethics? It ﬁrst describes the basic ethical dilemma: Why doesn’t our behavior match our ethical intelligence and intentions? e section then lays out the basis for individuals’ values systems and explains why ethical behavior is a winning strategy.
e book wraps up with Part 4. business. it helps show the way in which an ethical person can deal with the issues. the media. sports. We hope you enjoy putting these ideas into practice. is section analyzes the ethical issues we see practiced (and malpracticed) every day in the world around us: politics. For each sector. and religion. Bob Stone and Mick Ukleja xvii . Ethics Around Us.with the ethical content in the myriad of issues we face in our work and in our relationships in general.
Part 1: Got Ethics? Got Ethics? Part 1 xix .
Steve goes out of his way to do favors for others because he thinks it makes the world a better place. “Don’t worry. we face a hurdle in the rule-based nature of our society.The Ethics Challenge Gary is a retired social worker who volunteers for civic causes. the insurance company will never know. When he drives into town. Steve advised Mick.” Nobody is above the law. When the auto body shop that Mick uses oﬀered to repair damage from another accident and report it as part of a new claim. he parks his car in the supermarket parking lot (“Parking only for Safeway Customers”) and walks through the store and out the side door to the restaurant where he meets a friend for lunch. and everybody does it. Play 1 Chapter 1 . she ignores it because she would have to take vacation days from work while on jury duty. America is a “nation of laws. Nancy is a teacher of severely disabled children.” Why is it that so many of the nicest people aren’t as ethical as they think they are? is is the challenge facing anyone who believes in an ethical society. Ironically. She considers it unfair because many other jurors are paid by their employer and don’t have to give up vacation days. When she gets a summons to jury duty. who believes that if we all behaved ethically the world would be a better place.
don’t talk much about ethics. Unfortunately.Chapter 1: e Ethics Challenge by the rules. When could a government worker accept a meal from a government contractor? How expensive a gift could she accept from a friend who had dealings with her agency? In many states it’s the same with lawyers: mandatory “ethics” training that’s not about ethics at all. or the rules. judges. ey objected to the prominent role for Law. we pass a law. Ethics is rarely discussed in this kind of ethics training. by far the most church-going people in the developed world. but with the latest laws covering bribery and conﬂict of interest. But the Vatican 2 . who had resigned as archbishop of Boston after his role in protecting pedophile priests became known. Peter’s Basilica mourning the death of Pope John Paul II. police. It’s curious that Americans. So when the Vatican gave the disgraced Cardinal Bernard Law the honor of being the only American to lead a mass in St. For example. But when there’s an outrage. e Defense Department took the requirement more seriously. ethics is an afterthought if indeed it is thought about at all. and we prefer to talk about the law. defense contracting scandals were followed by a new law requiring—among other things—Federal workers to get one hour of ethics training every year. not on the internal values and motivations that are the heart of ethics. ese watchdogs enforce laws and rules. Our activities are circumscribed by lawyers. We’re a law-respecting society. umpires. because its workers got two hours. It naturally follows that we generally approve of behavior that’s within the laws and rules. and inspector generals. Business managers now get “ethics” training on how to avoid violating the Sarbanes-Oxley Act and landing in jail. some egregious behavior that we don’t approve of. auditors. the two hours didn’t deal with ethics at all. In many businesses ethics is turned over to lawyers who focus totally on compliance. referees. many American Catholics were outraged. even if somehow it doesn’t seem quite right when we think about it.
decided he could make more money by identifying his team with Los Angeles. Millions of Americans know about the Anaheim controversy because America is sports-mad. we cheered. which required “the name of the team to include the name ‘Anaheim’ therein. When the city of Anaheim sued the Angels. Would the team’s embrace of Los Angeles attract more fans than its rejection of Anaheim would repel? Would more fans buy Los Angeles Angels ball caps and T-shirts than would buy Anaheim Angels paraphernalia? All about proﬁt. the city lost in court—the jury accepted Moreno’s argument that the Angels were in technical compliance with the lease. and arguments about the economics of the change. we’re an outcome-oriented society. e ethics of so honoring Law was not addressed. For example.” e public even expressed admiration for the way he managed it. And sports. ere was hardly a word about whether it was ethical for Moreno to weasel out of the Angels’ lease with the city of Anaheim. opinions. so we’re happy to talk about measurable outcomes—like proﬁts and losses. the city couldn’t prove it had suﬀered ﬁnancial harm from the change. even when it turned 3 .e Ethics Challenge explained that Law was given the honor ex oﬃcio. the fact that Law’s honor was simply a matter of following the rules seemed to lay the controversy to rest. renaming the team the “Los Angeles Angels of Anaheim. more than anything. ethics wasn’t an issue. as archpriest of St. are driven by rules. owner of the Anaheim Angels. not ethics.” e Southern California media were full of articles. one of four basilicas under direct Vatican jurisdiction. Americans not only have a healthy respect for following rules. nothing about ethics. Again. e questions were all about proﬁts and damages when Arte Moreno. and the Olympic Games dominate television every four years. when the American Paul Hamm won the men’s all-around gymnastics competition at the 2004 Athens Olympic games by the tiniest of margins. Mary Maggiore Basilica in Rome. e Super Bowl is annually the most watched television program. and besides.
We may have been sorry for Yang. but the judges ruled that it was too late. ey each had a ﬁrst reaction of “keep the medal.” So what do these controversies teach us about ethics? First. only through a scoring error that’s been likened to giving a football team only two points for a ﬁeld goal. and sorry that Hamm’s day of triumph was rained on.Chapter 1: e Ethics Challenge out that Hamm had beaten his Korean competitor.” When asked. Even though we may consider ourselves ethical.” Sharpening our sense of ethics and looking at possible decisions from an ethical point of view is especially important in organizational contexts. we often make quick judgments based on rules and intuition. but our guy won. we need to talk about issues with our friends and colleagues. “What we don’t understand. “What would you have done in Hamm’s position?” all quickly said. forcing ourselves to look at the issues through an ethical lens. had won fair and square. We won’t really know our opinion until we express it. Yang Tae Young. Yang the silver. without raising questions of ethics. the American. Most modern literature on organizational improvement makes the case for moving away from bureaucratic rules and practices. and in the press agreed—at least every opinion expressed by an American. and even more importantly. and Hamm got the gold medal. Second. that we don’t immediately see most issues as ethical ones. “I would have given it back. Paul Hamm. Moving beyond bureaucracy depends on getting rid of most of the rules and restrictions controlling worker behavior and shifting to a 4 . We all judged by our hearts and by the rulebook. radio. Every opinion on TV. Robert Oppenheimer explained. we explain to each other. e Korean team protested. Who was the “real” winner? Our instinctive reaction was clear. As J. But what if we looked for the ethical content of the question? Is there an ethical standard to apply that trumps the rulebook’s detail about protests and deadlines. Was there an ethical thing for Paul Hamm to have done? Asking several friends what Hamm should have done helped us ﬁgure it out.
Is it something I am willing to be accountable for? 4. requires that the organization have a strong ethical grounding. Is the answer yes to all of these questions? If so. Is it legal and ethical? 3. a sense of mission and a culture of trust aren’t enough. with authority and responsibility shifted from the few at the top to the many front-line workers.” part of its Code of Ethics and Business Conduct. Is it consistent with my agency’s mission? 5. is shift. the “ask yourself ” idea is spreading through the business world.e Ethics Challenge diﬀerent form of control. one based on a strong sense of mission and a culture of trust. Without it. You already have it. 5 . Ethics must replace the missing rules. U. don’t ask permission. Am I using my time wisely? 6. however. Department of Education Reinvention Permission Slip Ask Yourself 1.S. Our favorite starting place is the “permission slip” issued by former Secretary of Education Dick Riley. Lockheed Martin Corporation uses similar words in its “Quick Quiz. JUST DO IT! (signed) Dick Riley Secretary of Education While the “Permission Slip” comes from government. Is it good for my customers? 2.
. 1. But how is ethical behavior to be strengthened? Ethics is too interlaced with the details of practically every decision to be taught as a “course” apart. ﬁrst-line supervisors. Ask Yourself. ask . Will I sleep soundly tonight? 7.. What would I tell my child to do? If you are still not sure what to do. International Paper. if only we would look for it. Are my actions legal? 2. But a permission slip or a quick quiz won’t work without a common understanding of ethical behavior. Wyndham. PG&E. reform eﬀorts are condemned always to be rolled back after inevitable ethical lapses lead to demands to tighten up again.. Ryder. because issues arise every day that have an ethical content. ethics can’t be taught just by ethics specialists.Chapter 1: e Ethics Challenge Lockheed Martin Corporation Quick Quiz When In Doubt. and many other corporations issue similar guidelines to workers. Am I being fair and honest? 3. hospital chiefs. How will it look in the newspaper? 6. Will my action stand the test of time? 4. In other words. Without such understanding. ey 6 . Texas Instruments. heads of government agencies.. How will I feel about myself afterwards? 5. It must be thought about every day. It must be taught by leaders—CEOs. and keep asking until you are certain you are doing the right thing. Cummins. line managers.
at work. And discussions of ethics will raise the ethical awareness of everyone in the organization.e Ethics Challenge must teach it by leading their organizations to examine issues for their ethical content. Many issues that appear to be tactical will turn out to be issues of ethics. 7 . Don’t assume behavior is right just because it follows the law or the rules. and at play. Become a teacher of ethics (and a student) at home. Lessons from Chapter One Talk about Ethics • • • Look for the ethical issues behind every controversy. And the logical place to start is to ﬁgure out what it is.
He and his plunderers ride oﬀ. And at the movies. at school. Most of us have all the education we need about moral choices. Yul Brynner plays Chris Adams. but never everything. saying. Steve McQueen. and that they’ve done their job. Chris accepts. e farmers explain that the tiny payment is everything of value in the village. and Eli Wallach. synagogue. a gunﬁghter who is oﬀered a pittance by a group of poor Mexican farmers to drive away the bandit Calvera (Eli Wallach).” He assembles a powerful gang of seven outlaws. who has been plundering their village. moral philosophy. e Magniﬁcent Seven. and the Magniﬁcent Seven think he’s oﬀ to plunder somewhere else. Fourth Edition. We learned at our mother’s and father’s knees. deﬁnes ethics as e study of the general nature of morals and of the speciﬁc moral choices to be made by a person. mosque. and they ride into Mexico. church. 9 Chapter 2 . a 1960 ﬂick with Yul Brynner. e American Heritage Dictionary. or on the playing ﬁelds. ey hide in the village and come out shooting when Calvera shows up.Obey Your Unenforceables A book on ethics needs a deﬁnition. “I’ve been oﬀered a lot for my work. We learned a key ethics lesson from a favorite movie.
e village will be no worse oﬀ than it was before we came. “ ere comes a time to turn Mother’s picture to the wall and get out.” Chris admonishes him. King James version. In America. “And as ye would that men should do to you. Judaism: “Love thy neighbor as thyself. dating from the earliest recorded history. do ye also to them likewise. from the New Testament. “ at’s just the kind you’ve got to keep.” Mahabharata. What is the “unenforceable” to which ethics requires obedience? For Chris Adams.1 But the Golden Rule is a part of every religion we know of. Most of us have our own set—usually implicit—of unenforceable personal rules of ethical behavior. and there’s no place else to plunder. “You forget one thing—we took a contract. who distinguished between the realms of law and of ethics. laid out in 1924 by the British jurist Lord Moulton.” Chris’s sidekick. who wrote e Magniﬁcent Seven screenplay. ere’s a famine in the area.” Luke 6:31. Vin (Steve McQueen) tries to mediate.” Leviticus 19:18 Brahmanism: “ is is the sum of Dharma [duty]: Do naught unto others which would cause you pain if done to you.” Chris is resolute. and most people’s lists start with the Golden Rule. sometimes called the ethic of reciprocity. “It’s not the kind any court would enforce. its most familiar form is the word of Jesus.” William Roberts. while ethics requires “obedience to the unenforceable. it’s his commitment.” Udana-Varga 5:18 10 . e Seven have gotten more than they bargained for.Chapter 2: Obey Your Unenforceables But Calvera comes back. put ﬂesh onto Moulton’s theory. e cowardly Harry (Brad Dexter) wants to bail out. 5:1517 Buddhism: “Hurt not others in ways that you yourself would ﬁnd hurtful.” e key lesson that Chris teaches is the distinction between law and ethics. Law requires obedience to the enforceable.
” Analects 15:23 Hinduism: “ is is the sum of duty: do not do to others what would cause pain if done to you.” Mahabharata 5:1517 Islam: “None of you [truly] believes until he wishes for his brother what he wishes for himself. A man asked Hillel to teach him the whole law (Torah) while standing on one foot. all the rest is commentary. Start with the Golden Rule (in very plain English): • Treat people the way I’d like to be treated. 11 .” e Talmud (~500 AD) sums it up nicely. do not do to your neighbor. and your neighbor’s loss as your own loss. Yoruba (Nigeria): “One going to take a pointed stick to pinch a baby bird should ﬁrst try it on himself to feel how it hurts. for example: Plato (428-348 BC): “May I do to others as I would that they should do unto me. a contemporary of Jesus. Hillel. is is the whole Torah. when it quotes the great teacher.” Kant (1724-1804): “Act as if the maxim of thy action were to become by thy will a universal law of nature.” Epictetus (55-135 AD): “What you would avoid suﬀering yourself.” Taoism: “Regard your neighbor’s gain as your own gain. “What is hateful to you. See there your own form.” Shayast-na-Shayast 13:29 e Golden Rule was also espoused by secular philosophers over the ages.” T’ai Shang Kan Ying P’ien.e Ethics Challenge Confucianism: “Do not do to others what you do not want them to do to you.” Zoroastrianism: “Whatever is disagreeable to yourself do not do unto others. at was easy for Hillel.” Seneca (54 BC-39 AD): “Treat your inferiors as you would be treated by your superiors. seek not to impose on others.” Our commentary hasn’t changed much since high school. Go and learn it.” Number 13 of Imam AlNawawi’s Forty Hadiths 5 Shinto: “ e heart of the person before you is a mirror.
One day Armi Armajani. he asked if that was the PSG way. You keep learning ethics as you practice a profession. e PSG way is to say. was considering whether and how to do just what a client asked. CEO of the Public Strategies Group. “Nah.” en.Chapter 2: Obey Your Unenforceables en come lessons we learned very young: • • • • • • • Play by the rules: winners never cheat. Keep my commitments. What’s not mine is not mine. because he was new to the world of consulting. and cheaters never win. e most important thing in life is a clear conscience. either orally or in writing. ‘A GREEN SUIT?? Why on earth would ANYBODY want a green suit?’” As we make a habit of thinking about the ethical implications of what we do. we keep adding to the list. even if I haven’t said I would. “When the customer says he wants a green suit. Don’t hurt people’s feelings even if they deserve it. But you can’t stop learning after high school. Do what’s expected of me. Expect more from myself than from others. Armi’s lesson—one we seem to have to keep re-learning—was about the ethical imperative to speak truth to power. then replied. So we added to the list: • Speak truth to power. Bob tried some wisdom from his early years at Garrett. that’s not the PSG way. It’s important to have a list because the very act of making the list helps you understand better what you think. When you try to actively express something. Armi thought for a minute. your brain is stressed to ﬁgure out logic and connections that you hadn’t 12 . turn on the green light.
e workshop was successful. She ﬁnally asked him to speak only for twenty minutes and to keep the entire event to one hour and ﬁfteen minutes. Shortly after writing that down. Bob had shown his list in a PowerPoint presentation. It’s easy to get product reviews and customer opinions. a price had been agreed on. and he had been helped to the conclusion by having written it down. But the shortness of the session presented its own ethical dilemma. and the client received the workshop she wanted. As William Faulkner said. A corollary to giving fair value is paying a fair price. On the one hand.” His conscience said. Like many people. On the other hand.” e client was delighted.e Ethics Challenge discovered yet. especially if they’re electronic things that we don’t understand very well. Sometimes when we’re not being particularly productive we don’t charge for some of the time we put in. “Cut the price in half. including “Give fair value. But sometimes we’re not sure: We’d like to see the products. Bob felt good. Bob recently stopped into his local camera store to check out 13 . which help to choose which models to buy. “I never know what I think about something until I read what I’ve written on it. ey agreed on a price and went to work designing the program. Bob agreed to do a two-hour ethics workshop for a client. As they talked about the event. the client kept shortening the time to give the participants more time to network. and the session turned out to be only seventy-ﬁve minutes. inking about this led to an addition to the list: • Give fair value. we buy lots of things over the Internet because we can usually ﬁnd a good price without traipsing all over town. the price had been based on a two-hour program. To make his dilemma more immediate.” In consulting work it’s important to stay conscious of what the client is paying for. and the participants got a lot of mental exercise thinking and talking about ethical dilemmas in their work experience.
demonstrated it.Chapter 2: Obey Your Unenforceables the cool new Canon and Olympus models. What’s not mine is not mine. e knowledgeable salesperson unreservedly recommended a Panasonic. and anyway. but sure to change as we face new challenges. When he got home he checked it out on the Web and found the highest customer ratings he had ever seen for any electronic item with prices from $280 to $325. • • • • • • • Treat people the way I’d like to be treated. Don’t hurt people’s feelings even if they deserve it. Keep my commitments. eir sales force and inventory add considerably to their cost.” up to date as of this writing. for $345. It didn’t seem fair to make use of them to great advantage—Bob never would have chosen the Panasonic without the salesperson’s advice and without getting to hold the camera—and not to pay for the added value. Do what’s expected of me. Play by the rules: winners never cheat and cheaters never win. So he kept the $345 camera. 14 . It’s hardly a rulebook: we made it up. So here’s our list of “unenforceables. So the list helps at work and at home. even if I haven’t said I would. Would it be ethical to return it and buy one on the Internet? e idea of giving fair value helped Bob ﬁgure it out. e store oﬀers expertise and lets you see and feel the product. explained why. even though going in he hadn’t known that Panasonic even made cameras. But what to call it? It’s not a code: a code is a systematic list of laws or enforceable regulations. and Bob was convinced. Expect more from myself than from others.” We like Lord Moulton’s idea of obedience to the unenforceable. He bought it with a money-back-no-questions-asked guarantee. it’s too short to be called a “book.
e most important thing in life is a clear conscience. and keep updating it. or at play. Is it worth it? Lessons from Chapter Two Obey Your Unenforceables • • • • Ethics is obedience to the unenforceable. at home. So it takes some work to deﬁne what you think is ethical. Give fair value. See e Magniﬁcent Seven. Write down your own list of personal rules of conduct. Talk about ethics every day with someone at work. 15 .e Ethics Challenge • • • Speak truth to power.
speculated about the reason for so much cheating. the boss’s favor. but most people eventually learned not to believe it. or wealth. ey see too much evidence to the contrary. in the papers and on the news.331 students at thirty-two graduate business schools found that 56 percent admitted to having cheated at least once in the past year. A recent survey of 5. the promotion. ey see every day. professor of management and global business at the Rutgers Business School. “ ey might feel they’re emulating behavior that will help them ﬁnd success in the real world. honest folk like us.Cheaters Never Win It’s no mystery why people cheat or lie or steal: they do it to win. fame. We met a businesswoman who chairs a quality institute 17 Chapter 3 . too many “winners” who won by cheating. to win the contract.2 One of the researchers.” ese students expect a lifetime of painful daily dilemmas— cheat or succeed? It’s all too easy to justify cheating when you know others are doing it. How much do we want to win versus how much do we want to do the right thing? Our future business leaders see these “winners” cheating and seem to conclude that cheating is acceptable and even required. Donald McCabe. is leads many people. to win the game. to do the arithmetic every day. To ace the exam. and winners never cheat? Everybody heard it. But didn’t they learn as children that cheaters never win. the election.
the bad feeling lingered on. It was cheating. His grandfather was right when he told him. he told the repairman to bill him for repairing the old damage. Bob saw what was going on and took out his textbook. but even now he feels bad for violating Major Fragala’s trust so many years ago. Perhaps he could get away with it. He wondered if the insurance company would notice. It would save Mick several hundred dollars. e body shop man oﬀered to repair some old damage and report it as part of the same accident. many students took out their textbooks to look up the answers. and he feels good now. 18 . When the instructor. he took it. Friends assured him that the insurance company wouldn’t check. e beneﬁt was always short term.” In spite of the advice. “Everybody does it. Like many MIT students of the 1950s. He felt good then. Major Fragala. left the class on its own after handing out a test. four years later. Afterward he reﬂected on the experience: His honesty cost him several hundred dollars. He felt good about having done the right thing and would have felt bad had he done the wrong thing.” We’ve all done some wrong things to gain some beneﬁt. Was it worth it? e answer was obvious. In college Bob had to take two years of ROTC. but he didn’t take it seriously. too. It wasn’t even close. “ e most important thing in life is a clear conscience. He got an A on the exam. When he asked whether they thought he should let the shop combine both repairs and bill the insurance company they assured him that. Of course it was. What is one to do in the face of “everybody does it”? Mick stumbled on his answer four years ago when a woman backed into his car and scraped the left front door.Chapter 3: Cheaters Never Win in a major European capital who self-righteously told us she never pays a bribe unless her competitor does it ﬁrst. Compulsory military training was an obligation of all land-grant colleges under the Morrill Act of 1862.
Like many people. and anyway. He got his friend Carl. But his calculation was wrong. “I cheated. e price Mick paid for a good day at the beach was a logistical nightmare and two years of living in fear of being suspended—short-term plus but a long-term minus. and he thought a good grade was important. as Bentham correctly theorized. But I’ll get an A on the exam and maybe make the Dean’s List. e semiconscious mental calculation went this way: If I cheat.e Ethics Challenge He knew that cheating is wrong. which he called utility. who had feminine-looking handwriting. but back then he ﬁgured it was a small thing. before they cheat? 19 . but he had gotten it wrong. at’ll make me feel good. but ever after. He had a shortterm plus but a long-term minus. Mick’s experience was equally painful. It worked. I’ll feel badly for doing wrong. e good feelings from the A and the Dean’s List will outweigh the bad feelings from knowing I cheated on an unimportant test. Jeremy Bentham (1748-1832). who argued that people act in such a way as to maximize their happiness. For years now. He wasn’t sure he knew the material well enough to get a good grade. when Mick needed a note from home or a report card signed.” right away he remembered. “Dean’s List. to write a note and sign Mick’s mother’s name. he had to track down Carl and get him to do it. an unimportant subject. Bob was an unwitting slave to the theory of a long-dead economist. But why do people not see this in advance. His pride in making the Dean’s list was lessened by his shame for cheating. most everybody else was doing it. the bad feelings will outweigh the good. e businesswoman who only bribed second was maximizing her utility—the contracts won brought her proﬁt—but as (or if) she thinks back over the ethical issue. every time he thought.” He had attempted to maximize his utility. In tenth grade he wanted to ditch school to spend a day at the beach.
or too something. or at least contribute mightily to. the business students may have it wrong.500 managers and executives for the “qualities that are most likely to help people win in the business world. the money would have loomed larger in his calculation.Chapter 3: Cheaters Never Win For some the bad feelings from having cheated won’t outweigh the good. “I’m diﬀerent. and that is what I want.” e student who expects to have to cheat to succeed also expects the resultant success to produce. Money and success can’t make us happy. Nor will honors nor big houses nor any kind of things. But everybody knows that money won’t buy happiness. Business Week asked 2. or this money) will help make me successful. “ is grade (or this win. not everybody believes it. e business school students who expect to have to cheat to get ahead will calculate. and that will make me happy. Having a clear conscience can. But we’re not so diﬀerent. Mick could aﬀord to be ethical with the insurance company: even a thousand dollar hit was something he could handle. Others have an underdeveloped sense of ethics. e trouble is. I’m diﬀerent. sometimes cheat because their mental calculation—usually hurried and sometimes barely conscious—shows a beneﬁt. or they may still be in the childhood mode of getting away with it. Everybody thinks. or too ambitious. People are slow to learn from others’ experiences. But if he had been overdrawn at the bank and maxed out on his credit cards and out of work. that’s not me. ey consider big companies fair game. or are there more tangible beneﬁts? First of all. But people who aren’t in desperate straits. What else? Is ethical behavior its own reward.” 20 . Not really. happiness. who have learned that what you can get away with is not necessarily okay.” If success didn’t make Joe happy. Joe was too greedy.
“When somebody learns that he screwed up. Hamm had disappeared from public view. 2005. talent. Paul was giving a presentation to Bob’s boss and mentor. Ken Parker. or you aspire to ethical behavior. you probably would like to work for ethical people in an environment that values that behavior. Paul responded defensively. right behind self-conﬁdence and far ahead of self-discipline. ‘I screwed up. a talented ex-coworker from a previous employer. Chapter 1 described how the American gymnast kept the Olympic gold medal he was awarded on a judging error. After the interview he gave his decision. but is rarely taken. Great fame. he once tried to recruit Paul. In Bob’s days as a junior engineer at Garrett-AiResearch.” A third kind of reward for ethical behavior is sometimes available for the taking. Such people will value you more if they believe you’re ethical. when it suddenly became clear that he had left a very important factor out of his analysis. Or perhaps not. Paul Hamm passed up the opportunity.’ not ‘I was a little optimistic’. and possibly great wealth can be there for the person who acts ethically when it’s unexpected.3 Second. Ethical behavior would have been for Hamm to oﬀer to exchange his gold medal for the rightful winner’s silver medal. By a year after the 2004 Olympics. I don’t want to have anything to do with somebody who won’t own up to a mistake. less than a year after Hamm’s Olympic “triumph.e Ethics Challenge Integrity was second on the list. ethics would have led to coming in second and being seen a loser. he got the ﬁnal 21 .” contestants were challenged for four hundred dollars to name the question that went with this answer: “In October 2004. When Ken called it to Paul’s attention. great honor. In this case. On June 30. ey’re likely to be intolerant of behavior that doesn’t measure up to their standards. the proper answer is. “I guess I was a little optimistic there.” at was it for Ken. if you consider yourself ethical. e best measure of fame in America may be the TV show Jeopardy. and aggressiveness.
Would Hamm have been so quickly forgotten if he had given back the gold medal? Certainly not. of course. his fame would have spread far beyond the gymnastics world. He would have been world renowned as the man who gave back an Olympic gold medal because it was the right thing to do.” e correct question was. Ethical behavior can be astonishing and memorable. With today’s celebrity incomes. ethical people promote ethical people.Chapter 3: Cheaters Never Win word that he gets to keep his 2004 all-around gymnastics gold medal. Integrity is valued highly. Hamm would have become a zillionaire. a guilty conscience will likely wipe out the beneﬁts. If Hamm had merely done the right thing. 22 . Lessons from Chapter Cheaters Never Win • • • ree e rewards of cheating are short term. “Who is Paul Hamm?” None of the contestants even made a guess.
e Ethics Challenge Part 2: Strengthening Your Integrity in a Greedy World Strengthening Your Integrity in a Greedy World Part 2 23 .
WorldCom. e Sarbanes-Oxley Act (the Public Company Accounting Reform and Investor Protection Act of 2002) was passed in response to a wave of corporate accounting scandals aﬀecting Enron. In many cases. We posed this as the challenge facing anyone who believes in an ethical society. e challenge can’t be met just with laws and rules. ey were hailed in national media as outstanding companies and leaders. Adelphia. Words are cheap simply because the supply is greater than the demand.” and a few individuals named.” You don’t have to be a researcher to see that these ethics statements have made little diﬀerence. “Top Companies To Work For. and many others. the policies did no more than serve as public relations oﬀerings. “CEO of the Year. Law can’t end ethical breaches either. many labeled. It’s hard to ﬁnd a publicly traded company without some “code of ethics. who believes that if we all behaved ethically the world would be a better place. 25 Chapter 4 . ethics is valuable because the demand exceeds the supply.Six Actions for Meeting the Ethics Challenge We asked at the start of this book why it is that so many of the nicest people aren’t as ethical as they think they are. Most of the companies and individuals that made the corporate “hall of shame” over the past few years had great ethics codes and great press.” But the ethics codes weren’t enough.
ey are oﬀered online or with highly paid consultants and often produce manuals that read like tax codes. But they won’t make us better.”4 Even companies not known for fudging on facts can have a culture that encourages bad behavior. companies must be able to demonstrate that they are producing ethical cultures. It is easy to fall into the trap of thinking we can legislate our way to morality.” It’s akin to having an ethical “ﬂea dip. four years after its enactment. most employees said that their organization’s code of ethics had minimal inﬂuence on whether or not they made correct ethical choices. But simply relying on rules and regulations is the “quick ﬁx” that doesn’t ﬁx. In the 2004 study from the Journal of Business Ethics. the ﬂeas come back. Principled living is an inside job.” You can rid the dog of ﬂeas by dipping. Ethical intelligence—knowing right from wrong—is something we all have. it’s against delusion. Ethics is an inside job. the CFO Journal reported that half of the respondents from companies with comprehensive ethics programs felt pressure to “do whatever it takes to meet targets. We are not arguing against laws and rules and codes. e argument is not against codes. You can have all the right laws and rules and codes of ethics. but make no actual impact. but if the dog’s environment isn’t changed. Character is an inside job. and ethical behavior. In this post-SarbanesOxley world. ere are no moral 26 . e real work starts on the inside. e hard work of personal growth and building character can’t be avoided.Chapter 4: Six Actions for Meeting the Ethics Challenge However. ey won’t produce integrity. Some companies force employees to take “remedial” classes. ey’re needed. e takeaway oftentimes is insight on how to avoid punishment or minimize ﬁnes if caught in an ethical breach. complete with loopholes and ﬁne print. ey deal with symptoms and not the fundamental problem of strengthening character. So external solutions to the ethics challenge aren’t enough. It was the culture of their companies and the examples of their leaders that inﬂuenced their conduct. Start with the diﬀerence between ethical intelligence. Punishment of an oﬀender can also be simply a symptomatic “cure. ethical courage.
It takes courage to execute in the midst of pressure—whether it’s self-imposed or imposed by others.e Ethics Challenge agnostics. Doing what’s right is not always easy. We’ve deﬁned six actions that will strengthen our ethical readiness and help us to do the right thing instinctively. ey will help us grow as ethical individual leaders—from the inside out. e news reports often point out how one person brought down an entire organization. ey are • • • • • • Embrace your purpose Test your excuses Harness your moods Insist on integrity Cultivate trust Self-diﬀerentiate 1—EMBRACE YOUR PURPOSE People who are successful in living out ethical behavior. We’ve dissected them for purposes of clarity and understanding. have a ﬁrm grasp of their 27 . What’s not reported is the converse—that one person can bring the organization up. is is the determination to follow your good intentions. but they all overlap and work together. It becomes epidemic— what economists call a virtuous cycle. How we behave is what matters— whether we’re talking about an individual or an organization. Doing the right thing emboldens others to do the right thing. en there is ethical courage. We’ve also tried to make them easy to remember. How can we follow our good intentions when the moral fog sets in? is leads to ethical behavior. especially in the midst of pressure. People in all cultures know the Golden Rule. the vast majority of people would be able to get the right answers on the test. When it comes to knowing right from wrong.
is a case in point. It’s who you are as a person. A course entitled “ e Ethics Of Corporate Management. was asked 28 .Chapter 4: Six Actions for Meeting the Ethics Challenge personal values. “ is course is not concerned with the personal moral issues of honesty and truthfulness.” at the University of Michigan. former CEO of Tyco. is may explain the widespread expectation among students that they’ll have to cheat to get ahead. e description in the catalogue states.”6 Says a seasoned bank recruiter in Chicago. We’ve had the privilege of speaking to students in a variety of university settings. and that it will ﬂourish naturally. Clarity of purpose leads to clarity of conduct.”7 When Dennis Kozlowski. It involves your vision for your life. It is assumed that the students at this university have already formed their own standards on these issues. “We’re asking the ethics-type questions. skills. the internal qualities that assist you along the way as you accomplish your vision. and styles follow this principle. But nothing could be further from the truth. and we’re doing behavioral interviewing. Successful leaders of widely diﬀering personalities. It includes your organization and your job. “In a new era for business.”5 Obviously students do come with a set of standards. values and goals—is in. ey have pre-decided what they hold as non-negotiable rather than making it up as they go along. you’ll be unclear when faced with ethical uncertainty. Transparency—in terms of ethics. CEOs face a new mandate. Embracing your purpose transcends your job. Teachers appear to make the assumption that the purpose is there. Glamour and glitz are out. your picture of what you want your life to represent. e executive recruiting ﬁrm Heidrick and Struggles has this to say. It includes your core values. e importance of embracing a purpose may seem obvious. It is your point of view. and we’ve discovered that embracing your purpose is not one of the key principles taught in the classroom. but without conscious clarity about just what their standards are. But their future employers are very clear. but it’s bigger than both. If you’re not clear about your non-negotiable values. and it shapes your life. but it is not.
2—TEST YOUR EXCUSES “It’s not my fault. “I hire them just like me: smart. with a lot of people getting hurt. No one can survive. Embrace. no matter how clever we think we are.” “I didn’t have time. In their book. and beyond. He said. but to understand it. It is human nature to make excuses. it’s important to be clear about what it does mean.e Ethics Challenge about his hiring philosophy. Becoming clear on what our targets really are creates clarity of thought and action.” “Everybody else was doing it. and strengthen your purpose. If something turns out to be bad or embarrassing. ethical breaches and collapses will abound.” “I was unlucky. As Yogi Berra is said to have said. if success means simply getting rich and richer. throughout your life. If success doesn’t mean that to you.” Failing to be rock-bottom honest with our actions is probably the biggest form of counter-productive behavior. the key is not to mask it with excuses. It leads to a series of small cracks that eventually—often times quickly— become a chasm leading to an abyss. his stated purpose. cultivate. without facing up to downturns. you might wind up someplace you’ll regret.”8 But as Kozlowski himself demonstrates. “If you don’t know where you are going. e problem is that excuses retard both personal and professional progress.” If you don’t know where you’re going ethically. mistakes. Just Enough. you might wind up someplace else. Laura Nash and Howard Stevenson deﬁne success as. and want to be rich. “the collection of activities that will be viewed aﬃrmatively by you and those you care about— now.”9 Being explicit about what personal success means ensures that our long-term focus counts more than our short-term instincts. and problems. he was essentially stating his point of view. “How did it get here?” “How can I prevent this from happening again?” Anything less is short-term and shortsighted. Mistakes 29 . is is also true of organizations. young.
3—HARNESS YOUR MOODS A study of red light violations showed a strong relationship between feeling under pressure and breaking the law. ey want people around them who will help them test their excuses. “STOP!” or “What are you doing?” High performance leaders always surround themselves with people who will tell them the honest truth—the unvarnished truth. is not the biggest problem.”10 Sullivan had an excuse—he was saving the company—that made it okay in his mind to falsify the ﬁnancial statements. “I made horrible decisions.” Often. Making mistakes. but she went to prison for her second mistake—lying to cover it up. but our excuses deprive us of the opportunity to learn. as with Walter Neﬀ. the ﬁrst mistake creates a problem. 30 . whether knowingly or unknowingly. Some lack in our background may come from a past error. but his second mistake—lying about it—was a disaster for his Presidency and led to his impeachment. On the witness stand he laments. Martha Stewart made a mistake by insider trading. In the 1944 movie classic Double Indemnity. “It’s not the ﬁrst mistake that gets you into trouble. then is persuaded to help her in a murder-for-insurance scheme. e problem really comes when we fail to admit. Scott Sullivan. Bill Clinton’s misconduct with an intern was a mistake. but the subsequent falsiﬁcation of credentials is a second mistake that almost always leads to greater condemnation. it’s the second. Two minutes of brutal honesty can save months of regret. ey understand that collective wisdom always exceeds individual wisdom. but the second creates a disaster. Fred MacMurray is Walter Neﬀ. the insurance agent who ﬁrst succumbs to the charms of his client’s wife. who will say.Chapter 4: Six Actions for Meeting the Ethics Challenge are wonderful learning opportunities. It was a misguided eﬀort to save the company. It helps to get feedback from brutally honest people who will tell you the truth. the mistake. or even see. told the court upon entering his guilty plea. former CFO of WorldCom.
telling ourselves that it will be okay. is is the basis of emotional intelligence. 24% occurred on lunch hour when doing errands or going out to eat. the long-term foundation for success. we shut our minds to others because we’re in a bad mood. 13% were committed on the way home from work or school. It starts with self-awareness—the ability to read our own emotions and accurately assess our personality. We let our moods harness us rather than harnessing our moods. It’s easy. Why is it so hard for people to take what they know to be right and put it into action? Why is the courage that leads to ethical behavior so diﬃcult—especially under pressure? It’s the lack of mood mastery. especially in pressure situations. We speed through a red light. Under pressure we can become myopic and forget the broader picture. 31 . especially under pressure.e Ethics Challenge • • • • 41% occurred when drivers were on their way to school or work. how to do it. e ﬁrst step is to be aware of our moods. we procrastinate. e more pressure we are under. e next is to harness them. and that you ought to do it. is leads to self-management—the ability to keep destructive emotions under control. the more likely we are to behave unethically. to violate our own set of unenforceables. If our ethical intelligence is to lead to ethical behavior. we need to harness our moods. Sometimes you’ve known what to do. A basic human frailty is that we allow our moods to master us rather than making sure that we master them. We ﬁnd shortcuts. You are probably a lot like us. But you didn’t do it! You discovered that good intentions can get hijacked by your feelings. we must be self-aware and follow that with self-management. If we are going to follow our good intentions. to let our moods master us. we cut oﬀ another driver. 9% of the red light violations were committed by people on vacation.
11 Two-thirds of boys surveyed and more than half of girls agree that. 32 . In addition. Such a strategy might work at a particular time. there is a wealth of evidence that it aﬀects our health. the more inner conﬂict. Our immune system seems to be strengthened or weakened by our integrity level. But the successful people are the ones who are growing in integrity. A healthy lifestyle results from more than the foods we eat or the rest and exercise we get. Seventy percent of surveyed undergraduate students admit to cheating. it’s a very poor strategy for long-term success. especially in view of all the contrary evidence we’ve cited in this book. as well as our relationships. Consumers punish companies they view as unethical by refusing to buy their products and by spreading negative information about them. Our bodies keep score of how closely our values and our behavior are aligned. “In the real world. of course. e business advantages of integrity are not easy to explain. Today the Internet and YouTube make consumer discontent especially costly. e wider the integrity gap. Young people—our future leaders—need convincing about the importance of integrity.Chapter 4: Six Actions for Meeting the Ethics Challenge 4—INSIST ON INTEGRITY Popular TV shows like e Apprentice and Survivor send a not-so-subtle message that life’s winners are those who can deceive others without getting caught. but it’s not only wrong. e key is to continually be growing in integrity so that the gap lessens as our beliefs and our behaviors come closer to alignment. e successful person is intentional about closing the integrity gap. but the business costs of lack of integrity are very apparent. and no one’s integrity is total. Our integrity level impacts our organizational and ﬁnancial success. Good or poor health also reﬂects our integrity. Everyone has an integrity gap—the distance between what we say we believe and how we actually behave. and the weaker our immune system. Yet we know that that doesn’t work in the real world. No one is perfect.
It’s one of the most satisfying human experiences. Integrity is something you have. 5—CULTIVATE TRUST Trust is the key to relational cohesion. trust has declined throughout our society in recent years. Elected Government Oﬃcials Executives of Large Corporations Leaders in Television & Film News Reporters & Journalists Small Business Owners Clergy Teachers 3% 3% 3% 5% 8% 11% 14% Only one out of every seven people trusted teachers. ability. A development company that is one of our clients has as its credo. sometimes not. trust is “ﬁrm reliance on the integrity. Do It Right. but living successfully without it is impossible. 33 . It’s also natural.” Trust is diﬀerent from integrity. sometimes based on experience. Trust is something others have in you. Sadly. It’s what allows people to come together. Do It Right Now! Living with integrity isn’t easy.e Ethics Challenge successful people do what they have to do to win. What is trust? According to e American Heritage Dictionary. Do e Right ing. At a deep level. or character of a person or thing. Integrity means that when you say you are going to do something. you do it. even if others consider it cheating. even when scared. and they were the most trusted. It’s a feeling or perception. want to trust their parents. Fourth Edition. we want to be able to trust people. and it’s what keeps them together.”12Integrity requires giving and demanding fairness in every transaction. Little children. the results13 were discouraging. When people were asked if they had “complete conﬁdence” that leaders from a number of professions would consistently make morally appropriate jobrelated decisions.
e study debunks the persistent myth that good corporate citizenship hurts ﬁnancial results. and its intellectual capital. 1982. lost $150 million (including $50 million for the promotional and stocking eﬀorts). invented tamper-resistant packaging. the company had spent more than $155 million to promote the brand. DePaul University researchers compared the ﬁnancial performance of the top 100 “Best Corporate Citizens” selected by Business Ethics magazine to the remainder of the S&P 500 companies. they had gained back their market share. and J&J faced a horrible dilemma—to recall the product from Chicago-area stores (all deaths were in the area) or to recall the entire inventory of product worldwide. If they pulled the inventory oﬀ the shelves. e leadership had embraced their purpose as expressed in 34 . it would cost Johnson & Johnson one-hundred million dollars—in one day! J&J’s marketing department pointed out the danger of total destruction of the brand. Tylenol had captured more than 35 percent of the market—more than three times the market share of its nearest competitor. trust is an asset as valuable as its buildings. that seven people had died in the Chicago area from taking cyanide-laced capsules of Johnson & Johnson’s Extra-Strength Tylenol. e nation was in shock. Tylenol earned 17 percent of the company’s proﬁts. Trust is the key to the creation of a company’s reputation. But CEO James Burke stood ﬁrm. and the J&J board stood with him.14 We still remember the chilling news on September 30.Chapter 4: Six Actions for Meeting the Ethics Challenge In an organization. ey recalled thirtyone million bottles. and accounting did the numbers about red ink. and grew public trust that still serves the company more than twenty-ﬁve years later. ey reminded themselves of their credo— primum non nocere—Above all do no harm. Since the drug’s introduction. and therefore its shareholder value. e average performance of the ethical companies was ten percentage points higher. alerted other pharmaceutical companies of the dangers. distributed eighty million coupons for its new product. People prefer to do business with companies that they trust. Within one year. its equipment.
It is helpful to break trust down into three types. decide on the right investment. . is is not the time for justiﬁcation or rationalization. listen with an open mind. or ambition of the person making the decision. or pack the parachute? e third is structural trust. In return. 1. Figure out what happened. e second is expertise trust. which refers to a person’s speciﬁc ability. is is basic and is grounded in conﬁdence in a person’s integrity. James Burke trusted the public to make the right decision and gave people the unvarnished facts. do the surgery. Be very clear on the issues. it was clearly the right choice. ey openly communicate their vision and values. What was the fallout? Who got hurt? What is the degree of the damage? Was there collateral damage? Own up to the mistake. e Golden Rule applies in the area of trust as well. Except to CEO James Burke. their own and others’. One might have personal integrity. e ﬁrst is personal trust. but can he or she actually ﬂy the plane. e problem named is often the problem solved. In retrospect. is is relative to the role. Is there a conﬂict of interest? What does the person making the decision have to gain or lose? Should they include others in the decision to avoid losing the conﬁdence of outsiders?15 Inevitably everyone makes mistakes that put trust in question. 3. People who cultivate trust ﬁrst of all insist on integrity. they trusted him as he openly and honestly communicated—and lived—the company’s values. focus on shared goals. Trusting others to do the right thing goes a long way in building their trust in you. do the right thing regardless of personal risk. although it wasn’t nearly so clear at the time. how should we respond to rescue threatened trust? We recommend Galford and Drapeau’s formula16. e “accuse and excuse” technique only 35 2. Since this is inevitable.e Ethics Challenge the credo. Assess the damage. and demonstrate compassion. Get the facts straight before any debate. and this helped them make some very tough decisions. responsibility.
36 . in general. Nine of the ten worked for Asch and were instructed beforehand to choose the same wrong answer. do your thinking for you. Groupthink is similar to crowd (or mob) psychology and the herd instinct. which can get even the brightest to go along with action they know to be wrong. 4.Chapter 4: Six Actions for Meeting the Ethics Challenge creates a deeper problem. It’s what allows—or causes—people with a high level of ethical knowledge to commit small wrongs. It’s a powerful pressure. It’s the foundation for both good leadership. the other three-quarters of the subjects went along with the group’s wrong answer. Fifty years ago. To avoid being swept along into unethical behavior. Even though the correct answer was obvious. the careless willingness to let the group. you must self-diﬀerentiate. You must be clear about where you end and the group begins. or huge wrongs. is is often left out when apologies are made. Eﬀects Of Group Pressure On Modiﬁcation and Distortion. like degrading detainees at Abu Ghraib prison in Baghdad. only one-quarter of the subjects chose it. He asked a group of ten people to choose which of three lines on a chart in front of the room matched the length of a line on an adjacent chart. To put teeth into an apology you must let the other party know what you are going to do about it. like serving beer to under-legal-age students. It’s what allows us to behave our way rather than the group’s. e Scottish author and minister George MacDonald said that to be trusted is a greater compliment than to be loved. Solomon Asch did his groundbreaking work. e tenth was the subject of the experiment that demonstrated the power of groupthink. 6—SELF-DIFFERENTIATE Self-diﬀerentiation is clarity about who you are as distinct from those to whom you’re connected. Failure to self-diﬀerentiate promotes groupthink. and good relationships. or members of the group. in particular. Cultivate trust. Identify and communicate remedial actions.
But we must be aware enough of ourselves and the group to know where the group ends and we begin. 37 . not only in the lives of other people but also in our own lives. We’ve all seen this in action. Connecting with others is important. ***** e six actions outlined by E-T-H-I-C-S will help strengthen the connection between the ethical knowledge we have and the behavior we exhibit. Lessons from Chapter Four Six Actions for Meeting the Ethics Challenge • • • • • • Embrace your purpose. Insist on integrity. Of course they have an excuse (but test your excuses—see above. Many who commit ethical breaches are shocked afterward at their own behavior. Harness your moods. Self-diﬀerentiate. Test your excuses. But connection without self-diﬀerentiation is ethically dangerous.” High impact ethical leaders do these six things to strengthen their own ethical behavior and that of the people around them. ey will make it instinctive for us to “walk the talk. Cultivate trust. Being human means we don’t ignore or cut ourselves oﬀ from the group.e Ethics Challenge Feeling for others is important.
Part 3: Ethics at Work
Ethics at Work
Ethics for Bosses
e media are full of stories of bad behavior by leaders caught treating their institution’s assets as their own. Examples abound from business, government, charities, and academia. e logic is simple: bosses contribute more than subordinates; therefore, not only must they be paid more (often much, much more), but, in addition, their bodies and minds must be nurtured, even what some might call spoiled. eir valuable time must be protected at all costs. On a ﬂight from Washington to Saudi Arabia during the buildup to the ﬁrst Iraq war, there was a line to get into the bathroom. Since General Norman Schwarzkopf ’s time was so valuable, he had a major hold a place in line for him. When the major had ﬁnally worked his way to the front, he stepped aside for the busy general.17 Bosses’ time must be protected from intrusion, so they can remain free to think. When Disney executives attended a corporate retreat at Walt Disney World, they were given a tour of the park by bus, but the private time of Disney’s president, Michael Ovitz, was so valuable that he rode by himself in a limousine.18 Bosses have families, too, and like all families, they sometimes can take the boss’s attention away from more important duties. So an assistant secretary of defense dispatched his military assistant, a navy commander, to pick up the boss’s wife and kids when the family car was in the shop.
the assistant secretary could carry out his daily schedule with its important meetings. One of the most painful choices is between the organization’s need to cut costs and the workers’ needs to put food on the table. it’s often about choosing between human needs and organizational ones. no doubt. or even often. Ovitz could think Mouse-worthy thoughts. But the practices have their own problems. When Bob was setting up the newly formed National Performance Review (then-Vice President Gore’s reinventing government project) he saw the new suite had a corner oﬃce with windows on two sides overlooking busy Seventeenth Street. since the oﬃce walls keep the light from reaching the subordinates’ workplaces. he allowed subordinates to eat lunch around his conference table when it wasn’t in use. and how are bosses to deal with them? First. his productivity. and if bosses want to look like idiots to their subordinates. and Bob could envision a reinvented government. But what are the ethical issues. or between two diﬀerent wrongs. And in organizational settings. Of course he took it for himself. It’s more often about choosing between two diﬀerent rights. about choosing between right and wrong. e light and the view were an added beneﬁt beyond the space and privacy: they raised his spirits and. e assistant secretary was violating the law about use of government people. e practices meet the needs of the organization. Schwarzkopf and Ovitz were damaging their reputations for common sense. kittycorner from the White House. General Schwarzkopf could plan a war. We’ll leave the legal issues to the purveyors of mandatory ethics training. And because he was enlightened. so they often get large private oﬃces with windows only they can enjoy. nobody can stop them. ethics isn’t always. and Bob was satisfying his own needs but not his subordinates’.Chapter 5: Ethics for Bosses Bosses need more privacy and more workspace. All these examples have some logic. Often the decision is to lay oﬀ workers that the organization can 42 .
is premise was in line with the age-old ethic of the military: an oﬃcer puts the troops’ welfare ﬁrst. the Group invested a lot of eﬀort and time to set up a new company to employ them. Rather than laying oﬀ the HR staﬀ. But the motto was sending another message. When the real estate crash of 2008 hit.” In one sense the slogan is unexceptionable: of course the mission is ﬁrst. e Group’s culture had long claimed to value people over proﬁts— here was the chance to show it. posted on walls all over army bases: “Mission ﬁrst. with the Group’s vice president for human resources moving over to head the ﬂedgling company.e Ethics Challenge get along without. but the Group has given them a ﬁghting chance rather than coldly meeting organizational needs by laying them oﬀ. it’s why we have the GE Corporation. the oﬃcer’s own 43 . eir survival isn’t assured. or HR. As we go to press. he ran into the army’s motto of the day. to take better care of the troops. e Bonita Bay Group—of which Mick is a principal—handled it diﬀerently. especially the army bureaucracy. It’s why we have an army. e Professional Employment Organization. it’s why any organization exists. one that was poisoning the thinking and behavior of leaders and workers all over the army: People come second. the Group had little need for the human relations. Another kind of ethical dilemma involves the inevitable conﬂict between the organization’s mission and the needs of its people. e Group is one of the largest developers of master-planned communities in southwest Florida. because he was trying to spread a fanatical commitment to taking care of the troops. When Bob was ﬁghting with the Pentagon bureaucracy. At the same time the company had a compelling need to cut costs in the face of declining sales. the PEO has a contract to handle Bonita Bay’s HR work and has landed some outside clients. people always. Bob argued about it with army leadership. department it had set up earlier to manage hiring and to service a large staﬀ.
Harry Wetzel. it was common for many oﬃcers—in our opinion. Virginia. when a brigadier (i. one-star) general strode to the head of the line with his intended purchase. “Say buddy. “I’m a general.S. waited in the same cafeteria line as everybody else. but he knew one big thing: lines were bad. the CEO.e.” Kingston spat. whose last command was Commander in Chief of the U. “You’re not a general.” e thousands of workers in his command worked very hard to make sure that the admiral never saw a sailor standing in line. e workers saw that Harry—as everyone called 44 .” One of our favorite base commanders was then-Rear Admiral Jimmy Pappas. and they do all they can to avoid unnecessary demands on the troops’ time. get to the end of the line. One oﬃcer who didn’t believe in indiscriminate cutting into line was army four-star General Bob Kingston.” he explained. end of the line. Now. us the oﬃcers only eat after they see that the soldiers are fed. Others went straight to the head of the line as their right. In dining halls that served oﬃcers and enlisted personnel. e brigadier hadn’t expected to be challenged and pointed to the single star on his shoulder. and sat at the same picnic benches. Good military leaders are no diﬀerent from good corporate leaders.Chapter 5: Ethics for Bosses second. is was too brazen for Kingston. please. You’re a brigadier general.” Kingston said. the better ones—to wait in line for food with the troops. Virginia. At the Garrett-AiResearch Corporation (now a part of Honeywell).. Kingston—dressed in civilian clothes—was standing in the checkout line at the liquor store on the army base at Fort Belvoir. ate the same food. who commanded the huge naval complex at Norfolk. Pappas was a surface warfare oﬃcer who had commanded several ships and knew little about running a military complex. His favorite saying was “Lines deprive people of life. After he retired from active duty. “I’m a general. Central Command. the same job later held by Generals Norman Schwarzkopf and David Petraeus.
the space was redesigned so that nobody had a private oﬃce—or. Everyone was assigned a workstation. the human need is sometimes privacy for everyone. including Paul O’Neill at Alcoa. And the people who ran the cafeteria made sure that all the food and the ambiance was ﬁt for the CEO. Wetzel resolved the conﬂict between organizational needs (his time was more valuable and costly to the company) and human needs (his hunger was no more important than anybody else’s) in favor of human needs. but our private oﬃces also made it easy for us to speak to a doctor about personal health issues and to our wives about family plans. Wetzel’s choice was both ethical and practical: workers felt that the company was committed to them. everybody did. Of course the workers were glad to eat there every day. Bosses have no more need for or right to privacy than anybody else when it comes to health and family issues. many CEOs have done away with their private oﬃces. and they returned that commitment in the form of increased spirit and productivity. We did that as bosses. e organizational need is sometimes for privacy for the boss. Everybody knows bosses need privacy so they can counsel subordinates and hold secret meetings.e Ethics Challenge him—didn’t think he was any better than they: higher ranking and much better paid. At the reinventing government project. for any reason. Michael Bloomberg at Bloomberg LP and then 45 . but a better person? Certainly not. Anyone who wanted privacy. and when privacy was needed. Is there a conﬂict? Not necessarily. Today most large employers that provide food service serve everyone in the same place: executive dining rooms in corporations are on the way out. A more subtle conﬂict between human and organizational needs involves privacy. In a similar vein. yes. went into one of the private oﬃces and closed the door. there were four very small unassigned private oﬃces—two not much larger than telephone booths. rather.
Chapter 5: Ethics for Bosses at the New York City mayor’s oﬃce. Inc. He had ﬁred the pastor after making a business decision: the man was doing more harm than good. Many bosses have faced the dilemma Mick faced when he was senior pastor of a fast-growing Southern California church with ten full-time pastors. Practically every organization has some form of this idea as part of its stated values system. One of the pastors was extraordinarily capable. Scott Adams captured the dichotomy perfectly in a Dilbert cartoon. Some participating members actually left the church because of this one pastor. by United Feature Syndicate. there was one problem: He mistreated the people who worked for him. But far more important than any issue of oﬃce arrangement is the general question of people. energetic. But there was an ethical issue Mick hadn’t seen at ﬁrst: the man wasn’t living up to the stated values of the church. and Paul Otellini at Intel. However. Bill Owens at Nortel. as in: People are our most important asset. Mick eventually let him go because he was doing more damage than good for the church. Afterward. he was putting his own interest above others’. and productive and made important strategic contributions to the church. Mick realized he had waited longer than he should have to take action. is issue is the most important and the most diﬃcult dilemma facing leaders who want to preserve a culture of people 46 . whom they felt didn’t have their best interests at heart. Nearly every one falls short of living it. including many volunteers. DILBERT: © Scott Adams/Dist.
makes the numbers—sky’s the limit! Type II: doesn’t share the values. trust-based culture we need to win today and tomorrow. “None of these three are tough calls. by themselves. His formula was: • • • • You’re there to serve. not to be served. Should she have ﬁrst dibs on the company seats at the ballpark? Should he get a free parking space? Should she get time oﬀ to do her Christmas shopping? Bosses need a simple formula for dealing with these issues. another chance. or two. doesn’t make the numbers—gone. Jack Welch—arguably the most successful CEO of the past ﬁfty years—stated it with great clarity. Don’t make a big deal out of other privileges. Type I: shares our values. a host of other potential issues of special privileges for the boss arises. former navy Seabee commander and then head of construction for the huge Los Angeles Uniﬁed School District. is type is the toughest to part with because organizations always want to deliver—it’s in the blood—and to let someone go who gets the job done is yet another unnatural act. It’s not your outﬁt. informal. who delivers the bacon but does it on the backs of people. We commend Jim’s formula to all bosses. e best one we’ve ever seen comes from Jim McConnell. but delivers the numbers. Type III: shares the values. but Type IV is the toughest call of all: the manager who doesn’t share the values. 47 . misses the numbers—typically. But we have to remove these Type IVs because they have the power. the “go-to” manager.e Ethics Challenge ﬁrst. it’s just in your trust. to destroy the open. Command is a privilege in itself. Jim taught incoming Seabee commanders—bosses all. often “kissing up and kicking down” during the process. the hammer. “ e four ‘types’ represent the way we evaluate and deal with our existing leaders.”19 Finally.
Your human needs are no more important than anyone else’s. 48 .Chapter 5: Ethics for Bosses Lessons from Chapter Five Ethics for Bosses • • • Look after human needs as well as organizational needs. e only perk you get that nobody else gets is being the boss: nothing else.
” But telling the truth to the boss is the ﬁrst responsibility of an ethical subordinate. resigning instead. ethical behavior means not to follow it slavishly. use their brains on the job—perhaps not always. but to point out the error. it’s even harder to be ethical when you’re not in charge. as happened in 1973 when Attorney General Elliot Richardson refused President Nixon’s order to ﬁre the independent special Watergate prosecutor. it’s crucial for business (or organizational) success. Nixon then ordered Deputy Attorney General William 49 Chapter 6 . eir success depends on correcting or reversing bad decisions early. Even the best of them aren’t always right. Most workers today are knowledge workers. which includes their best thoughts. to use Peter Drucker’s term. but often. when the boss gives a faulty or even dumb instruction.Telling Truth to Power If it’s hard to be an ethical boss. Richardson refused the order. Imagine working for a boss like Samuel Goldwyn. “I don’t want any yes-men around me. Archibald Cox. arguably the world’s most successful movie producer. And so. even to refuse to follow it. I want everybody to tell me the truth even if it costs them their jobs. Knowledge workers. who famously said. Truth telling isn’t just a matter of personal integrity. Sometimes the refusal can come at the cost of one’s job. by deﬁnition. ey were hired for their brains and for the ability to use them. Executives make lots of bad decisions. ey are paid to give their best eﬀort.
“Bob Stone. not lower. and gave him a major dressing down.” He returned to his oﬃce. the air force people in his audience would laugh heartily. too. e net result of his insulting them and apologizing was—through Jean’s intervention—to raise. Afterwards Bob was depressed and wandered into the oﬃce of one of the organizers. But it doesn’t call for laughing oﬀ the boss’s bad behavior. As a boss. Ruckelshaus resigned as well in the course of what became known as the “Saturday Night Massacre.” Pity the boss whose subordinates always agree with him. but not for long. and you should apologize!” Jean was right. had thought the conference was a good idea. She was being an ethical subordinate. practically ﬂew into his oﬃce behind him. feeling better for having gotten it oﬀ his chest. e apology gave him a chance to tell the people he had hurt how much he valued their hard work and enthusiasm and also to remind them that he. “Boy. Once at the National Performance Review. He unburdened himself. their morale. and he apologized. You should be ashamed of yourself. Bob was often blessed with subordinates who were not yes-men—or especially not yes-women. ﬁrmly shut the door.Chapter 6: Telling Truth to Power Ruckelshaus to ﬁre Cox. am I glad THAT’S over! What an awful way to spend an afternoon! at was the most depressing meeting I’ve ever had to sit through. ey’re not doing the boss any favors. 50 . but he never knew how funny his jokes were because whenever he would get to the punch line. Jean Logan. what you just did was awful! ose people worked their hearts out for two weeks to make this happen. e late General Bill Creech was an inveterate joke teller. of course. He wasn’t bad at it. for that matter). doing the right thing even when it was hard to do and involved some risk. you totally demoralized them. two staﬀ members organized a small conference that turned out to be a dreadfully gloomy aﬀair. a staﬀ member who had overheard his comments. Being polite may call for laughing at the boss’s joke (or at anybody’s. Funny or not—hearty laughter. and in ten seconds.
Months went by. e boss bears some responsibility for creating an environment that encourages truth telling. explains: “ ey told a story in the Columbia Investigational Report that the very real part of why we lost Columbia was a culture that did not enable the people at the lower level of the organization to feel comfortable speaking their piece. director of NASA’s John F. that the situation had been getting worse for months. You’re so intense everybody’s afraid to confront you. explaining about all the good the man was doing and “winning” a short debate with Linda.” Mick called the entire staﬀ in.e Ethics Challenge But the boss shouldn’t count on subordinates all being as strong minded as Jean. afraid that you’re too good a debater and that you’ll just argue with the messenger. When Mick was a senior pastor. Mick let the pastor go. but Mick challenged her. A culture that inhibits truth telling can lead to calamity. Both sides learned from the incidents. “You owed it to yourself and to me to have told me the truth. and asked if they shared Jim’s and Linda’s feelings. e staﬀ learned that Mick really did want to hear the truth. She was discouraged and told us that you wouldn’t listen. A woman we’ll call Linda did bring it up. Mick learned what many bosses never learn: that the boss has an ethical responsibility to create a truth-telling culture. but you dismissed her. ere were people down there who were trying to say. people who worked at the church knew about the pastor who was mistreating people (as described in chapter 4).” Jim pushed back. and things got worse with the abusive pastor. while the staﬀ avoided bringing it up again with Mick. Mick was critical. James Kennedy. Finally a man we’ll call Jim screwed up his courage and told Mick the truth. Everyone said he or she did. Kennedy Space Center from 2003 to 2007. as it did in the tragic loss of the space shuttle Columbia. ‘I saw in the post-ﬂight ﬁlms in the ascent 51 . one at a time. but were reluctant to bring the matter to Mick. “Linda told you.
While challenging the boss—or the hoped-for boss—only rarely leads to loss of a job or job oﬀer. Bob once was in a meeting being run by an executive who was considering him for a job that he really wanted to land. Bob didn’t get the job.’ and. “You encourage truth-telling in your demonstrated behavior. According to Kennedy. there are some deﬁnite approaches that can bridge desire and reality. en there’s the risk of not getting a job that you want. Risk takes many forms.Chapter 6: Telling Truth to Power of Columbia. so he asked a naïve question. proving that Bob wasn’t a team player.” is 52 . and I think we might have taken a hit to wing leading edge. And we might have a problem. it’s one thing to say that you want people within an organization to tell the truth. “Why are we here?” It was the kind of question that often gets to the heart of an issue.”20 Of course. Perhaps the biggest obstacle to ethical subordinate behavior is the fear of ostracism or becoming “not one of the guys. once or twice—it doesn’t take many times—you slap somebody down in public because he said something that you totally disagree with. ere is the Samuel Goldwyn kind—risk of being ﬁred—which is usually more feared than real.’ But they were not comfortable speaking their piece. it’s another thing altogether to make it happen. Bob couldn’t see the point of the meeting.” Truth telling seems risky when the boss doesn’t encourage it. e executive couldn’t answer it and became angry. it often leads to embarrassment or being labeled “not a team player”—a diﬃcult label to bear. ‘I want to know your honest opinion. If you say. He was told later that the executive—known only to his subordinates as “Jim the Terrible—had considered the question to be a challenge to his position. I saw something that really scares me. you’d lose credibility and people will no longer feel that they can really tell you what they’re thinking— that it’s just a bunch of hockey puck. You have to demonstrate that you mean it.
serving—and feeling quite over his head—until the incoming Reagan administration could get its man. Jean—alone of the fourteen supervisors—refused to do it. In the meantime. Larry Korb. or even to join in. it can drive people to overlook bad—even criminal—behavior. I just acted quickly. And I wasn’t married. who had 53 . It’s much easier than challenging the boss. didn’t have two kids to support. but no.” While Bob hadn’t learned ethics from Atticus Finch. In 1981. the gentle-but-very-tough lawyer who takes on the whole town in To Kill a Mockingbird.e Ethics Challenge feeling is so powerful. “My gut tells me very quickly what’s right and what’s wrong. she had been risking her job to do the right thing for a long time. he can relate to wanting to sleep at night. e fourteen got together and discussed the task. Bob thought perhaps his eﬀorts to create a nurturing workplace environment had made it easier for her.” Jean brushes oﬀ suggestions that she is courageous. and I didn’t want anybody to think I’m a bad person. “I was just trying to be nice to everybody.”21 Almost everybody has at some time overlooked—or gone along with—the bad behavior of a boss. but the fact that it was wrong was more important to me than staying out of trouble. Korb. Years before a boss had instructed her and thirteen of her fellow supervisors to rank all the people in the department according to their performance on the job. conﬁrmed. I’m friends with everybody. Afterwards I was worried I was going to get in trouble. he was acting assistant secretary of defense. and it was important for me to be able to sleep at night. All considered it unfair and unethical to rank people they didn’t know. and she persuaded the others to refuse as well. Jean Logan says she learned not to go along with bad behavior from Atticus Finch. Army Specialist Jeremy Sivits was sentenced to a year in military prison for mistreating prisoners at Abu Ghraib prison in Baghdad. “I didn’t have time to think about it. Sivits confessed that he took one of the photos of abused detainees because he was asked to.
Sometimes ethical behavior pays oﬀ. Next morning he screwed up his courage and told Korb it was a bad idea and why. just dumb. “I understand that I’ve been very lucky to work at things I love with people I love. then you must tell him or her. One day Korb told the then-deputy assistant secretary of defense for Installations that he would have Bob sign an order to the army that Bob thought was a very bad idea—nothing unethical. but he just couldn’t bring himself to sign the order. however. although he didn’t realize it at the time. But the potential costs or beneﬁts can’t be a part of a decision to act ethically. But I agree it’s not the right thing to do. But you’re sure not going to get it unless you’re willing to make yourself uncomfortable and go looking for it. sat beside Bob to learn and to make sure he was doing things that were congenial to the new administration. the father of chemical engineering 54 . Two months later. you bound yourself to give your best thinking. “Doc” Lewis. Korb grinned sheepishly. but lucky. Jean Logan explains.” Bob was not only ethical. sometimes it doesn’t. If you’re lucky. one that would lead him to a new world of entrepreneurship and would give him a chance to make a huge diﬀerence in the lives of our two million troops and one million civilian workers in the Defense Department. He wanted to accommodate his new boss and didn’t want to force him to renege on his ﬁrst commitment after his nomination. Bob’s telling him the proposed order was dumb certainly didn’t hurt his job prospects and most likely helped a lot. and many people don’t get that opportunity. at night Bob lost a lot of sleep.” Warren K. When you signed on as a knowledge worker. If that leads you to conclude that the boss is wrong. Korb called him in and oﬀered him the Installations job. there’s eventually a payoﬀ for ethical subordinate behavior—a big one. “I only said you would sign the order so I could end the conversation.Chapter 6: Telling Truth to Power no formal authority until he was conﬁrmed by the senate.
but to no avail. If the pump failed. some will get angry. Undaunted. newly hired in a steel mill. “But I tried to warn you how critical a pump failure would be. He ﬁnally got to the plant manager. 55 . It’s an obligation you’ve got to keep if you’re to be an ethical subordinate.e Ethics Challenge in the United States. He told his new boss. You don’t give up after making an out or three. Behaving ethically is a little like hitting a baseball: You study hard. the pump failed. and the blast furnace was wrecked. Some bosses will greatly value your truth telling. then step up and swing. e plant manager called in the young engineer and ﬁred him. you should have made me listen. but they brushed him oﬀ. Sometimes you’ll succeed. You won’t get a hit every time. who also brushed him oﬀ. you’re being paid to use your head: that requires telling the boss what you really think.” “If you knew. keep thinking and talking about it. Soon afterwards. even if you have to make him listen. there would be millions of dollars in damage. But that’s no reason to give up the struggle to be an ethical subordinate. He soon stumbled onto the fact that the blast furnace was dependent for cooling on a single pump. then his boss’s boss. he kept telling people up the line. whose ﬁrst assignment was to look around and learn how the plant worked. Lessons from Chapter Six Telling Truth to Power • • • If you’re a knowledge worker. but you keep at it.” An employment contract entails an obligation to tell the truth to the boss. It’s never too late to start truth telling. sometimes you won’t. inspired generations of truth tellers with his oft-told story of a young engineer. It’s sometimes very hard and sometimes involves serious consequences.
We prefer certain schools. at’s 57 . but we’re really not. we dislike some. was called by a team of oﬃcials from the Paciﬁc 10. e football authorities try to minimize the chances of unconscious bias by assigning game oﬃcials to handle games of schools to which they have no connection. pulls a knife. In the same vein. Everybody has biases. For example. the oﬃcials call one or two “phantom” holding penalties against USC every game. ere’s a classic experiment in which the test subject is shown a ﬁlm of an argument on a subway train. Of course we like to think of ourselves as objective observers. almost unconsciously. bias on our judgment. shabbily dressed. even while they’re missing obvious infractions committed by the opponents. that hijack our impartiality. We notice that two-thirds of the time that pass interference is called against the Trojans it should really not have been called. We watch them on TV whenever we can.Chapter 7 Impartiality We’re huge fans of the University of Southern California Trojans football team. and our sympathies impose a powerful. We recognize these biases. We love some people. the 2007 national college championship game. Our sympathies are with the Trojans. But we also make assumptions. and after angry words have passed. We admire people in particular occupations. if unconscious. argues with an African-American in a suit. between Florida of the Southeastern conference and Ohio State of the Big 10. A white person.
We may have a son at the school whose game we’ve been invited to referee. It takes an average of three retellings for the knife to migrate to the African-American’s hands. or have a trusted knowledgeable colleague do—or at least draft— the performance review. and sports oﬃciating.Chapter 7: Impartiality the end of the ﬁlm. 58 .”). First is our own experience. e bias is a deep-seated assumption that a black man is far more likely to pull a knife on a white than vice versa. impartial judgment is part of the deal: there can be no bias against Mom’s or for USC. Never eat at a place called Mom’s. e best we can do in such circumstances is to recognize our bias and opt out of the decision process: decline the invitation to referee the game. Bias against Mom’s or for USC can be ethical or unethical. e ethical diﬃculty arises because many factors conspire to rob us of our chance at true impartiality. harmless (Go. and some on sentiment (we favor USC). Acting on the basis of bigotry is obviously unethical. Performance evaluations. or harmful ( e black man had the knife. e American Heritage Dictionary. and so on. For a restaurant critic or a football referee. Fourth Edition. contract awards. judging. Some biases are based on facts (a young man in jeans with a headband and tattoos seems more threatening on a lonely dark street than a middle-aged woman in heels and a dress). especially one that inhibits impartial judgment. Biases can be useful (“Never play cards with a man called Doc. or recuse ourselves from the contract award process. en the test subject reports what he has seen to another test subject. deﬁnes bias as a preference or an inclination. depending on the situation. are just a few of the endeavors that require impartiality. Impartial judgments are called for in many jobs. Or we may have an old friendship with a person who is bidding for our company’s business or with a subordinate at work who’s due for an evaluation. some based on blood relationships (my children are more beautiful than yours). Trojans!). who passes it on to a third.).
If it didn’t come from an old friend or relative. chances are it was an attempt to erode our impartiality. “It’s preposterous to think that I can be bribed by a ﬁfty-dollar trinket. Or if a reporter asks about an issue—a permit application or a new product test—that issue becomes more prominent in your mind. But even the fact of the invitation can introduce a bias in the inviter’s favor (or sometimes. For many activities. it also requires the appearance of impartiality Impartiality is nowhere more important than at the U. for a member of Congress or the President’s or governor’s staﬀ even to ask about a prosecutorial or regulatory issue is considered highly improper because of the potential eﬀect on the prosecutor’s or regulator’s impartiality. If the job requires impartiality. we need to ask why the invitation was made. A gift or an invitation to dinner or a game may be proﬀered as an act of generosity or friendship.e Ethics Challenge Second. In such circumstances. It erodes the conﬁdence of all who are counting on a fair hearing—whether for a governmental regulatory action. often sincerely. In government. Now Joe becomes special. and Americans count 59 . in his disfavor). We’ve heard it said that. or even a stranger. Rather it’s inﬂuence. Sometimes our impartiality is threatened by an innocent inquiry from a boss. other people attempt to inﬂuence us. “How’s my friend Joe doing?” you now know that Joe’s performance is of interest to the boss. a relative. “I wouldn’t sell out for the price of a dinner or a ticket to the big game. impartiality is so critical that even the appearance of bias is a serious detriment. a sports event.S. and you may be tempted to raise its place on your to-do list.” But selling out or bribing isn’t the issue. If the boss asks. e best ethical choice is refusal. Supreme Court.” Or. or a legal proceeding. certainly not for honest people like us. a friend. at’s the court of last resort. and your impartiality is compromised. just an attempt to put the decision in friendly hands.
New York Attorney General Andrew 60 . To keep the appearance of impartiality. we expect conservative-slanted opinion. not straight down the middle. the National Education Association. Similarly. millions of schoolteachers have been ﬂeeced of their retirement funds. however. Teachers expected their national union. life insurance. She is paid not only to judge impartially. As a result. and because the American system of government depends on public acceptance of Court rulings. but that it also appear impartial. to be impartial when it endorsed speciﬁc annuities. ese lenders were on the college’s preferred lender list.Chapter 7: Impartiality on the Court to fairly settle issues of the greatest import. like abortion or same-sex marriage. it’s especially important that the Court not only be impartial. College students have also been widely victimized by people they trusted to look out for them. To avoid giving defendants the impression that the court was allied with the prosecution. But there’s a special obligation when impartiality is expected. us it’s unfortunate—and unethical—that justices make speeches to groups that lobby for causes that are likely to come before the court. When we watch Bill O’Reilly’s political commentary. because it gets kickbacks (the NEA calls them “royalties”) from the plans. and buyers. because they trusted the union to look out for them. and other retirement plans. e NEA endorses ﬁnancial plans. but also to present an image of impartiality. we don’t require it of everyone. we don’t expect impartiality. like who won Florida in the 2000 Presidential election. Because the Court deals with matters of such gravity. referees. she forbade the oﬃcers from socializing with the bailiﬀs in the courtroom. we expect James Carville to be left leaning. they would take a seat next to them and engage in friendly chats. When arresting oﬃcers knew the bailiﬀs in her courtroom. Many college ﬁnancial aid oﬃcers have accepted expensive gifts from companies that made college loans to students. Neither would be judged unethical when his biases show. While we demand impartiality from our judges. Leora Krygier is a judge in Los Angeles Juvenile Court. one must keep at it. and the more partial the better.
e Ethics Challenge Cuomo testiﬁed to the Senate Banking. But how impartial can an elected oﬃcial be if he’s raised huge amounts from the American Federation of State. e most expensive House race in 2008 was for California’s 4th District. County.3 million to defeat Democrat Charles Brown. ninety percent of its students who take out loans do so with companies on the lists because they trust the colleges.5 million. We trust our government—federal. Much of this money comes in small donations with no expectation of any special treatment. so people in government have a special obligation. e bigger the oﬃce. even when the preferred companies’ loan terms are less than ideal. whose campaign spent $326 million. Teachers trusted their union to give impartial advice about how to fund their retirement. and Municipal Employees (AFSCME) or from AT&T? And how impartial does AFSCME expect the recipients of its $2.3 million ($40 million since 1990) to be? What expectations does AT&T have of recipients of its $4. county. the bigger the cost. at’s why our system of electing people is so vexing. It costs money to run for oﬃce. city—to be impartial. Norm Coleman spent $22 million. where Republican Tom McClintock spent $3. but we know our elected oﬃcials aren’t. or the bigger the jurisdiction.2 million ($41 million since 1990)? So here’s a dilemma: We trust our government to be impartial. Both groups were betrayed. It’s a dilemma we’ll have to 61 . state. and Urban Aﬀairs Committee that when a college has a “preferred lender” list.22 Both the teachers union and the college ﬁnancial aid oﬃcers violated a central ethical principle: When people trust you. who spent only $2.23 Members of Congress spend much of their time raising money—to pay for their next campaign. and Al Franken spent more than $20 million on their 2008 battle for Coleman’s Minnesota senate seat. be trustworthy. Students trusted the aid oﬃcers to give impartial advice about where to get the best deal on student loans. And Barack Obama’s presidential campaign spent $712 million to defeat John McCain. Housing.
To continue they must raise money. and want to serve the public. we sometimes are stuck with our biases and can’t escape the need to make a judgment. or it may be an unpleasant requirement of the job that we have to handle ourselves. then to bend over backwards to be objective. It’s tempting to label politicians unethical or to let them oﬀ the hook by saying everybody does it. When possible.Chapter 7: Impartiality live with until there is a change in campaign ﬁnancing that prevents the candidates from knowing who their contributors are. an ethical person needs ﬁrst to be superintrospective to recognize his or her own bias. bend over backwards to be fair. 62 . In such circumstances. You may have to look hard to recognize yours. Be open about your biases. when it’s not possible. When loved ones or friends or favorite teams are concerned. are not enriched by their work. Many politicians are dedicated public servants who live within their salaries. Lessons from Chapter Seven Impartiality • • • • Everybody has biases. Your biases detract from your ability to make impartial judgments. e system is unfair to everybody. it’s sometimes harder to see our own partiality. While it’s easy for us to recognize gray areas for politicians (especially those of the other party). avoid making judgments where you can’t be completely impartial. Both extremes are wrong. and any way they do it puts them in an ethical gray area. ere may not be anyone to whom we can delegate a judgment.
which states. It was a full football season before he ﬁnally ﬁgured out there was a reason why the buyer had free tickets to give away.. Or anybody who wants something. e next year Bob bought his own tickets—not such good seats. “It is Honeywell policy to discourage the receipt of gifts [from our suppliers or potential suppliers] either directly or indirectly by employees as any gift may be misconstrued as an attempt to inﬂuence business decisions. As a young engineer at Garrett-AiResearch. Or vendors. with lobbyists substituted for Greeks. now a part of Honeywell. Someone was giving him tickets to encourage him to look a little more favorably on the ticket source’s bids for Garrett’s business. Bob was given tickets to the Los Angeles Rams by one of Garrett’s buyers.” “Misconstrued” seems like the wrong word. Or subordinates. Honeywell has a thirty-sixpage code of business conduct.Giving and Receiving Gifts have aroused suspicions.C. Excellent seats. about which Virgil wrote. Today there aren’t as many free tickets ﬂoating around Garrett.” Virgil’s warning could well be rewritten today. at least since the Trojan War of the twelfth century B. Or salespeople. “I fear Greeks even when they bring gifts. “construed” 63 Chapter 8 . the kind that only long-term season ticket holders get. but better positioned ethically.
according to federal law 5 U. Members of Congress get gifts—lots more than Supreme Court justices. the only reason to give gifts is to inﬂuence the judge.” he said. He seems to have a lot more friends than the other justices. doing business with. Gifts to Federal employees: No Member of Congress or oﬃcer or employee of the executive. To ﬁnd an example.Chapter 8: Giving and Receiving would be more appropriate.C. a Phoenix lawyer who headed the ABA’s Commission on the Model Code of Judicial Conduct. the political world has not. Several justices accepted gifts of lesser value. we need look no further than the Supreme Court. legislative. or judicial branch shall solicit or accept anything of value from a person— (1) seeking oﬃcial action from. Kennedy. e Los Angeles Times reported that Justice Clarence omas accepted gifts that he valued at $42. 1998-2003. and Breyer reported that they had accepted no gifts at all.”25 It’s perfectly legal for omas to accept gifts. ey’re not supposed to.S. Public oﬃcials accept gifts from people who want to inﬂuence them. His defense is that the gifts are from friends.24 Why did people give these gifts to Justice omas? Mark I. or (in the case of executive branch oﬃcers 64 . Stevens.200 over a six-year period. while Justices Souter. had an explanation. “Unless they are family members or really close friends. Harrison. § 7353. “And we think it is not helpful to have judges accepting gifts for no apparent reason. provided he discloses them. Why else would a supplier or potential supplier give a gift to a Honeywell employee if not “to inﬂuence business decisions”? While the business world has awakened to the potential of gift giving to lead to corruption.
Still. Of course. Don’t accept a gift from someone you don’t give gifts to. were caught in the gift-giving web of lobbyist Jack Abramoﬀ and resigned or were retired by the voters. if you work for the federal government. Federal law bars gifts by a federal worker to a superior. the individual’s employing entity. you need to take pains to learn what you can give or receive without risking serious trouble. Congress has written its own regulations that loosen the restrictions that they made a show of accepting. Mick tried when he was a pastor to not know what people gave and how much. there’s a corollary to Jim McConnell’s rule. He told his ﬁnance manager that he didn’t want to see the list of gifts—just to be told when the time came to write a thank you note. which we described in chapter 4: Being boss is the privilege. If you’re a public employee or member of Congress. too. not everything goes.e Ethics Challenge and employees) conducting activities regulated by. including former House majority leader Tom DeLay. as have more than a dozen since the 1970s. if your work depends on receiving gifts—say head of a charity or a church—this advice is impractical. If you’re a boss. e corollary is this: e only material beneﬁt to being boss is 65 . Other members. Duke Cunningham resigned from Congress and went to prison for accepting gifts. But there’s a simple test that will keep you out of legal trouble and out of the ethical shadow as well. don’t make a big deal out of other privileges. and don’t give gifts to someone who doesn’t give them to you—except your family. Giving gifts—even innocently—can get you into trouble. or (2) whose interests may be substantially aﬀected by the performance or nonperformance of the individual’s oﬃcial duties.
no side deal for your spouse. No lavish junkets. others are given to inﬂuence. accept. no free tickets. Just the joy of tackling something worthwhile.Chapter 8: Giving and Receiving your compensation package. 66 . no valuable gifts. or exchange gifts only with loved ones. Lessons from Chapter Eight Giving and Receiving • • Some gifts are given to loved ones. Give.
while thousands of motorists were suﬀering through freeway traﬃc from the San Fernando Valley to downtown Los Angeles. if newspapers adhered to the highest ethical standards we aspire to. “ e great majority of mankind are satisﬁed with appearances. it’s probably a duck. We’re continually warned to avoid the appearance of impropriety. Readers of the Los Angeles Times picked up their paper on June 7. and are more often inﬂuenced by the things that ‘seem’ than by those that ‘are’. “One recent Friday. Bratton skipped the congestion and made the trip in a fraction of the time. Where there’s smoke there’s ﬁre. in both the public and private sectors. but. Many ethics codes. as though they were realities. When known scandal is in short supply.How Would it Look in the Paper? Appearances matter. advise us to judge the ethics of a proposed action in part by how it will look in the newspaper. 2006. 67 Chapter 9 . sadly. Machiavelli explained. and.” But appearances are not realities. If it looks like a duck and quacks like a duck. newspapers slip up like the rest of us do. Police Chief William J. and then ethical behavior can be made to look very bad indeed. Newspapers—and other media—rake in readers by reporting scandal. they may have to invent some. It might be. to see this lead to a story splashed across the front page of the California section. “How will it look in the newspaper?” is not related to ethics.
it would be even easier. Any reader would have assumed that the chief must have done something wrong. It would surely have failed the Lockheed Martin Quick Quiz we described in chapter 1. Money. allowing him to visit two and three bases in a single day. In Bob’s career at the Defense Department he often requisitioned small military jets to ﬂy from base to base. A mean-spirited writer could easily make this look wasteful. If the executive worked for the government. We think the government got good value from his travels.” but the article went on to detail Bratton ﬂights to Las Vegas and to Los Angeles’s west and south sides. Greg Woods. Bratton’s extraordinarily successful work to cut crime and to change the culture of the LAPD was advanced by his traveling all over Los Angeles so that every cop saw him and heard ﬁrst hand what the new chief demanded of the department.” e headline read. But the only ethical violation that day belonged to the paper. but anybody could have tarred him unfairly with the label of wasteful. Another federal executive. Had Bratton applied the “how would it look” test. Bratton wasn’t getting any personal beneﬁt from his exhausting travel schedule.Chapter 9: How Would it Look in the Paper? buzzing from Van Nuys to Parker Center (police headquarters in downtown Los Angeles) in a city helicopter. or else why would the paper have printed the story? Bratton’s behavior looked very bad in the newspaper. rather than just one. His travel outside Los Angeles served the twin purposes of educating the chief about what was happening elsewhere in the world of policing and enabling him to spread the word about LAPD’s experiences. the late head of the 68 . he would have done much less traveling and been much less successful. “Chief Says LAPD Flights Save Time. Nor was Bratton’s behavior poor use of the city’s resources. Many executives use company planes to allow them to visit far more company sites than they could if they traveled on cheaper commercial ﬂights. Bratton’s use of LAPD’s aircraft is comparable to private sector practice. or even megalomaniacal.
If the arresting oﬃcer appears to be buddy-buddy with the court bailiﬀs. for business reasons if not for ethical ones. “How would it look in the newspaper?” But that’s a business decision. and even though ethical behavior can appear unethical and vice versa.e Ethics Challenge Federal Student Aid agency. in fact. To get the loans. Even though appearances aren’t reality. appearances do matter. people following that leader may get the idea that they’re part of an unethical 69 . D. e trips to Walt Disney World were good policy and completely ethical. and Chrysler for ﬂying to Washington in their private planes to ask for government loans. and. Ford. we explained how a position requiring impartiality. for example. performance improved substantially. in large part because of inspired leadership throughout the organization. So it’s not a bad idea to ask yourself. Greg believed that the experience would lead to better performance in his agency. ere is sometimes. however. before making a decision. Congressional committees and the media pilloried the CEOs of GM. also requires the appearance of impartiality. e papers never picked up what could have made a juicy—but unfair—story in Washington. Similarly. Unfavorable publicity like the Los Angeles Times story on Bill Bratton can inhibit bold-but-proper behavior.C. Some of his advisors counseled against it. would even have made the front page of the Washington Post. In chapter 6. the scales of justice are tipped because the defendant’s expectation of a fair trial is diminished. because it would have looked bad in the newspapers. a valid connection between the appearance of ethical behavior and the reality of ethical behavior. they had to commit to get rid of their planes. not an ethical one. sent his entire leadership team to Walt Disney World to learn leadership and customer service at Disney University. when a person in a leadership position does something ethical but which appears unethical. Our guess is that Bill Bratton would willingly have risked the unfavorable story rather than give up his style of leadership-by-presence. a judge.
Since leaders are in the business of not doing things the way they’ve always been done. or being silent—it’s important that they explain questionable-looking behavior. Neither does the “watch what I do. For ethical people like us. or worse. talking. standing still. Explanation is especially important because leaders are in the business of changing things. When they do. or they don’t have a satisfactory explanation. 70 . While. that may be the best of all tests. A better test of the ethics of a hypothetical action is. “How would it look to the staﬀ?” is the more important question aﬀecting the ethical health of an organization. and many people’s ethical grounding is based on what is. Leaders often avoid explaining their behavior to subordinates for a variety of reasons. But since leaders teach by everything they do— walking. leaders are often in the business of smashing organizational norms of behavior. that unethical behavior is all right. you can be pretty sure that in your gut you believe the action is unethical. “How would it look in the paper?” is a good question to ask before making a business decision. is obligation is widely misunderstood. their behavior is easily misunderstood. ey don’t want to appear defensive. e ethical leader has an obligation to explain himself when he takes an action that might appear ethically wrong or questionable.” is often a simple and comfortable guide to what’s permissible or ethical. not just an attitude of “the rules don’t apply to me. people are left to infer that the leader is a law unto himself—a particularly bad lesson in ethics. Moreover. Absent a clear explanation. or they may just belong to the “never explain” crowd. “ at’s the way it’s always been done.Chapter 9: How Would it Look in the Paper? organization. not what I say” school. “Can I explain it to my mother (or to my child)?” If either of those questions makes you uncomfortable. they’ll need to make it clear that breaking the norms is part of the new way of doing business.” e “never explain” school of leadership doesn’t work when the leader’s action may appear unethical.
explain it to people who follow your lead.e Ethics Challenge Lessons from Chapter Nine How Would It Look in the Paper? • • • e press can make ethical acts appear unethical. “Can I explain it to my mother (or to my child)?” 71 . Don’t let it deter you from doing the right thing. ask yourself. If your ethical action has the potential to look bad. If you’re in doubt as to the ethics of a situation.
there is ambivalence about rules. What do rules have to do with ethics anyway? Don’t they belong in the realm of the enforceable.” One of the most popular business books of recent years is First Break All the Rules. everyone is faced with decisions about whether to follow or break a rule. We’re a nation of laws. Rules are sometimes associated with bureaucracy and with lack of initiative. And as we explained in chapter 1. or can it be an estimate? May you exaggerate to improve your chances? May you park your mid-size car in a space marked “Compacts”? Aside from the ambiguity. Inevitably. is there a rule requiring you to state your precise income? May you say it’s greater than it actually is? Smaller? Must your answer be precise. If you park your midsize car in a compact space. When ﬁlling out a mortgage application. and on when conscience demands that laws be broken. Some rules are enforceable. it may be towed away. we recognize that obeying the law is the right thing to do.” “You’re remembered for the rules you break. like laws? Yes and no. ere is ambiguity about just what a rule is. although many books have been written on unjust laws. ethics is the realm of the unenforceable. “Rules are made to be broken.” “Rules are for the lazy to hide behind. No doubt about what’s a law: the Constitution tells us how laws are enacted. It’s not unethical 73 Chapter 10 . Law is the realm of the enforceable. for example. Rules are harder. law is distinct from ethics. In general.Breaking Rules Laws are easy.
right next door. to follow the rules of the organization. how frequently to check the tires and oil. and on and on. General Motors is famous for having thousands of pages of rules. Large organizations have large rulebooks. “ at’s just the kind you’ve got to keep. ey also have the consequence—intended or not—of “protecting” it from change. He faced a dilemma. So anyone trying to lead change inevitably has to decide under what circumstances to break rules. He was asked by the deputy commander of America’s largest military command. where they can be parked. e Pentagon tops that easily. Paciﬁc Command. He was trying to radically decentralize the operations of military bases and put more authority in the hands of local commanders. for what purposes they can be used. Did he play by the rules and ask OMB for a waiver—one he was absolutely positive they wouldn’t grant because granting waivers wasn’t in their DNA? Or did he break the rules and grant a waiver he had no authority to grant? e rules he was supposed to administer weren’t serving their 74 . Bob faced such a decision at the Pentagon as Deputy Assistant Secretary of Defense for Installations. Rules are designed to preserve the organization and protect it from mistakes and abuse. And as Chris Adams of e Magniﬁcent Seven said when his sidekick oﬀered an out from an obligation no court would enforce. ere are literally thousands of pages of rules just on operation of government cars—who can drive them.” Organizations have rulebooks. and Bob knew that he had no authority to waive it. ings are diﬀerent in an organization.Chapter 10: Breaking Rules (although it would be unethical to take up two spaces with your oversized car)—you size up the risk and take your chances. Unfortunately the rule came from the Oﬃce of Management and Budget. where they can be driven.S. the U. implicitly or explicitly. to waive a rule that was keeping the command’s foreign policy advisor—a State Department foreign service oﬃcer—from living in on-base housing where the admiral needed him. Members of an organization willingly contract. not the Pentagon.
e Ethics Challenge
purpose. e military he was supposed to serve needed help. He couldn’t get the rule changed or waived. His sense of ethics-cumduty told him that in this case his duty to the national defense outweighed his duty to enforce the rule. He was being paid to do a job, and he wouldn’t be doing it if he stood by passively and let some crazy rules weaken national defense—even just a little. So he broke the rules. He signed a waiver, knowing that he had no authority to sign it. e advisor moved on base, the admiral got the help he wanted, and the interests of national defense were served. Rule breaking is an issue for lower ranking employees, too. Jane Atkins (not her real name) was an administrative assistant at the Federal Student Aid oﬃce when she was assigned to set up a training workshop that Greg Woods, the agency head, considered urgent. Armed with her government Visa card, she set about buying the supplies that would be needed to train several hundred people. e bill came to four thousand dollars, and government rules prohibited charging more than twenty-ﬁve hundred dollars for any single purchase on the Visa card. So Jane had the store clerk split the order in two, each order under the twenty-ﬁve-hundred-dollar limit. Jane knew that order splitting was against the rules, but faced with the decision whether to carry out her assignment or follow the rule, she chose performance over compliance. She was later criticized by the inspector general for breaking the rule, and could have been terminated had not Greg Woods vigorously defended her and praised her initiative. Bob’s and Jane’s rule breaking could have had serious personal consequences for them. Were they behaving ethically? We apply three tests to decide whether we may ethically break a rule. 1. Will we gain a personal beneﬁt? 2. Is it taking the easy way out? 3. Is it serving the cause of justice?
Chapter 10: Breaking Rules
Neither Bob nor Jane beneﬁted personally. ey were not taking the easy way out. e easy way would have been to not get the job done and blame the rules—nobody would have ever criticized either of them for that. Finally, they were both clearly serving the cause of justice—in this case, doing what was best for their employer—the government. Our formula for acceptable rule breaking—the three tests—is only partially satisfying. While it makes sense to us, it might not make sense to the rule breaker’s supervisor. ere can be consequences for breaking a rule—and in the federal government, exceeding one’s authority can be cause for dismissal, although that rarely happens. ere are also consequences for not breaking rules: organizational ineﬃciency, lack of progress, or program failure. e ethical person must balance oﬀ two ethical imperatives: follow the rules, or do his or her best on the job. He or she must weigh the risk of being disciplined for breaking the rules against the comfort of using the rules to justify inaction. Bob and Jane come down on the side of action; Jane’s boss supported her. Bob’s boss never learned of the action. So both incidents had happy conclusions. But that won’t always be the case. Lessons from Chapter Ten Breaking Rules • • Members of an organization have an ethical obligation to follow the organization’s rules. ey may also have the conﬂicting obligation to break the rules to bring about organizational change or to accomplish their mission. ere are three tests to decide whether breaking a rule is ethical: personal beneﬁt, taking the easy way, and serving justice. Rule breaking may incur punishment, even if it’s ethical.
e Ethics Challenge
What does it mean to be fair? If you’re in a position of authority, you have to make choices about how to treat people. Authority means parenting, judging, supervising, teaching, or any other activity in which what you say goes—or supposedly goes. We’ve already dealt in chapter 6 with the need for impartiality in these activities and with all the things that can erode our impartiality. But let’s suppose you are impartial. Suppose you are Leora Krygier, judge in Los Angeles juvenile court, sentencing two seventeen year olds who have both pled guilty to driving 55 mph in a 35 mph zone. One lives in the wealthy area of Calabasas and drives a brand-new sixty-thousand-dollar BMW. e other comes from the very poor area of Pacoima and drives a ﬁfteen-year-old Chevrolet. e law provides for a ﬁne of $270 for this oﬀense but allows the judge considerable discretion to levy a smaller ﬁne. Most people would agree that both should be punished equally. But does that mean equal application of the rule? Imposing a $270 ﬁne on each? is could mean a small annoyance for a rich kid from Calabasas but a crushing burden to a poor kid from Pacoima. Perhaps fairness means equal pain. Perhaps the judge should ﬁne the rich kid $270 and the poor kid ﬁve dollars. at could work, unless the apparent rich kid from Calabasas was really a poor kid struggling to help his mother make house payments on
and the blindfold to keep her (Justice) from knowing whether the young man is from Calabasas or Pacoima. parents. Unfortunately. have been allowed to stay on because of a fear of lawsuits. a supervisor or a teacher must be wary of lawsuits. Krygier’s rule is to levy the prescribed $270 ﬁne on each. diligent employee’s tardiness may be overlooked. Classical depictions of Justice show a blindfolded woman with scales in one hand and a sword in the other. and many an employee who should have been ﬁred. Moreover. unless she can clearly articulate an argument for treating them diﬀerently. e scales are to weigh the evidence. Parents know naturally that their children have diﬀerent abilities and diﬀerent needs and should be treated diﬀerently. and supervisors aren’t. When it comes to meting out punishment. Since the judge doesn’t know either.Chapter 10: Breaking Rules a house she couldn’t aﬀord and the kid from Pacoima was thrifty and well-oﬀ. she really can’t tell what is most just. While Justice is blindfolded. A hard-working. teachers. Supervisors also know that their subordinates have diﬀerent abilities and diﬀerent needs. while a slothful coworker is docked for the time missed. Many a student who should have been expelled. as they deem appropriate. the sword to dispense punishment. is practice satisﬁes both her conscience and her auditor. we often demand formal proof of fairness. A slow child’s clumsiness in breaking something may be overlooked. being fair to the disruptive pupil or the slothful worker is being unfair to the pupils whose education is diminished or to the other members of the workgroup who are left to work harder. Supervisors are inhibited from treating their workers diﬀerently because of company rules or because of the desire to not appear unfair or partial. while his better-coordinated sibling may be chastised for the same misdeed. In our increasingly litigious society. 78 . treating everybody by the same set of rules relieves the supervisor of the need to make diﬃcult judgments and to explain them.
a non-proﬁt.”26 Howard is battling this phenomenon through Common Good. Who are they to judge? “ e triumph of individual rights over authority has implications far beyond the functioning of regulation. Brenda K. and all people in authority must continue to be wary of lawsuits. Authority has become a suspect concept.e Ethics Challenge is insistence on an impersonal “fairness” imposes a terrible cost on our society. highly eﬀective manager who was suddenly faced with a family crisis. Common good is pervaded with a sense of apathy and powerlessness.” Until Common Good succeeds. Although she loved her job. her sense of responsibility led her to call her boss. in e Lost Art of Drawing the Line. literally and ﬁguratively. Philip Howard. After taking a couple of vacation days. Because almost any decision aﬀects someone. He explains. was a hard-working. should have the authority to make decisions just because it seems right. distraught. the enemy of individual rights. If a subordinate’s family obligations or health calls for special understanding. “America has lost the idea that people with responsibility. teachers. Schools are falling apart. fairness need not demand that he or she be denied that treatment. principals. Her boss sensed that she was in no condition to make such a decision about her future and turned down her request. telling her to take the time she needed to take care of her family. Letting someone decide about someone else is unfair. But they don’t have to invent new shackles to keep them from accepting their responsibility. and ask to be relieved of her managerial position. It turned out to take less than two weeks before the crisis had passed and she was back at 79 . supervisors. she realized she would have to miss more time from work and didn’t know how much. ordinary choices are often paralyzed. nonpartisan legal reform coalition “dedicated to restoring common sense to America. like judges and school principals. or even special treatment. Fear and suspicion now infect daily dealings in the workplace. writes that “fairness” has gone too far.
according to some impersonal set of bureaucratic procedures established by the phone company. we think everybody is entitled to humane treatment. we discussed the diﬃculties of being truly impartial. it’s all by the book. But fair means impartial. ere’s a thick rulebook. and it entails some risk—someday it could land you in court. We don’t think we’re better than anyone else. Everybody needs special treatment some time. the passport oﬃce. One approach to impartiality is that of the legendary football coach Vince Lombardi. But 80 .Chapter 10: Breaking Rules work. and fairness allows—even demands—that they get it when they need it. bend over backwards to not be inﬂuenced by them. In chapter 6. by the Golden Rule. If you’re going to give special treatment to people when they need it. You’ll inevitably like one person and not like another person as much. or the bank. If you treat everybody like dogs. But managing ethically. then you must treat others as you would like to be treated. of whom one of his players said. e best one can do under the circumstances is to recognize one’s biases. Who says so? Is this ethics or personnel policy? If your list of unenforceable ethical principles includes the Golden Rule. true impartiality is impossible. Brenda was treated as a person. or treat everyone mindlessly by the rulebook. no reason to consider whether you like this person more than that person. no exceptions. fairness—and sometimes the law—demands impartiality.” is is also the approach of a bureaucracy. puts special demands on one’s impartiality. and be able to articulate—to oneself. impartiality isn’t an issue. We’ve all railed at being treated like a number. if not to the auditors—the reason for the special treatment. not as a number—she got special treatment. In an intimate group like a classroom or a work unit. and everyone is treated according to the rules: no special cases. “He treats us all the same: like dogs. It’s human nature to want to be treated as an individual human being. Managing ethically is harder than managing bureaucratically. No judgment is called for.
as in parenting. • Sometimes you’ll have to risk a lawsuit to manage ethically. special treatment for all. supervising.e Ethics Challenge an ethical person has no choice. that’s what you have to do. judging. take account of your biases and bend over backwards to be impartial. one must balance the rulebook against the Golden Rule: equal treatment for all vs. When applying the Golden Rule. If you’re a teacher or a supervisor. or teaching. • 81 . Lessons from Chapter Eleven What’s Fair? • When exercising authority.
Tell me about them. told a story about former President Jimmy Carter.Lies. Carter. founder of USA Today. moved 83 Chapter 12 . Miss Lillian. back in 1976.” e reporter. your son. thinking she had nailed Mrs. “Well. Carter. Carter had proclaimed that he would never lie to the American people. Some lies are not as bad as others. but maybe a little white lie now and then. Bill Clinton’s biggest crime may have been wagging his ﬁnger at the TV camera and saying in all faked sincerity. “Mrs.” Mrs. e Post sent a reporter to interview Mrs. says he has never lied. During the campaign. Shortly after he was elected. Miss Lillian met the reporter at the door to her modest home in Plains and showed her to a seat in the living room. shady accounting. e reporter got right to the point. not a real lie. the Washington Post requested an interview with his mother.” Juries that have a hard time understanding the arcana of insider trading. I’m going to say this again. the president-elect of the United States. and Scooter Libby—to name a few whose convictions came because they didn’t tell the truth. Jeﬀrey Skilling. I did not have sexual relations with that woman. Carter. ere must be some lies you recall as he grew up. and Shiny Shoes Truth telling is high on any list of ethical behaviors. Carter’s reply. primarily to prove that her son lied when he said he didn’t lie. Lying seems to be the one unforgivable sin. and White House spinning don’t have any trouble spotting a lie and delivering a guilty verdict for it. “I want you to listen to me. Just look at Martha Stewart. Alan Neuharth. White Lies.
Chapter 12: Lies, White Lies, and Shiny Shoes
right in. “What’s the diﬀerence? Give me an example of a white lie!” Miss Lillian smiled her disarming Southern smile, paused, and replied sweetly, “Well, like a minute ago. When I met you at the door . . . and told you how nice you looked . . . and how glad I was to see you!” Lies are deceptions, as the American Heritage Dictionary, Fourth Edition, puts it: 1. To present false information with the intention of deceiving. 2. To convey a false image or impression: Appearances often lie. Miss Lillian’s greeting was indeed a lie. She intended to deceive the reporter into thinking she wasn’t hostile. But perhaps it’s forgivable as a white lie or as a simple eﬀort to be polite. Actually, deception isn’t inherently unethical, nor is presenting false information with the intent of deceiving, in spite of what our favorite dictionary says. Deception is a time-honored part of many pursuits, most notably games and war. In football, for more than a hundred years, quarterbacks have attempted to deceive defenses by faking a pass, then executing a run, or vice versa. at deception is okay, even praised. But some deceptions are not: it’s not okay to fake an injury to stop the clock. In baseball, pitchers deceive batters with “change-ups,” slow pitches thrown with a fast-ball motion. Other games have their permissible and impermissible deceptions, distinguished in the various rulebooks. War is all about deception. Winston Churchill provided the justiﬁcation in poetic terms. “In war-time, truth is so precious that she should always be attended by a bodyguard of lies.” And of course in law enforcement undercover work, deception is a crucial contributor to police eﬀorts to keep communities safe. So some kinds of lies are perfectly ethical. Most are not, even though ethical people are sometimes pressed to lie. e most common occurrence is over secrets. Your boss asks your help in planning a layoﬀ that the organization is faced with, and you agree to keep the information conﬁdential.
e Ethics Challenge
en somebody asks you if a layoﬀ is planned, or worse, they ask if you’ve heard anything about a planned layoﬀ. ere’s no easy answer to this dilemma. It’s a classic ethical conﬂict. Do you tell the truth, or do you keep your commitment? A good person in this situation chooses between two mutually exclusive ethical acts, chooses between good and good. With experience, the ethical person will recognize the danger and try to avoid being placed in such a compromising situation. In public service, there are many opportunities to believe— wrongly—that it serves the public good to lie. Scooter Libby, former chief of staﬀ to Vice President Cheney, lied to cover up the vice president’s role in the campaign to impugn the writings of a critic of President Bush’s Iraq policy. Governments often value secrecy for reasons other than law enforcement or national security. In the federal government, there’s constant tension between the Congress and the administration over the budget. Members of Congress often have their own favorite programs or departments, and they try to join with the department to get around the budget limits that the administration has imposed through the Oﬃce of Management and Budget. When a congressman who favors funding a new weapon, for example, asks the army witness whether the army had requested that OMB include the weapon in the President’s budget request, the witness is on the spot. If he tells the truth, he’ll get OMB angry with him, and maybe the President, too. He may even have been warned by an OMB staﬀer not to tell Congress that the army had requested the weapon. If he lies, he’ll be okay with the administration, but not with his conscience—and maybe not with a grand jury looking to indict him for perjury. Countless administration witnesses have faced this dilemma at congressional hearings. Some have lied to keep OMB happy; some have told the truth with impunity, and some have been ﬁred for telling the truth. e conﬂict between secrecy (also sometimes called “loyalty”)
Chapter 12: Lies, White Lies, and Shiny Shoes
and truthfulness led in 2003 to the high-proﬁle ﬁring by defense secretary Donald Rumsfeld of army secretary omas White, who had engaged in a public dispute with Rumsfeld over the defense secretary’s proposal to cancel the Crusader artillery weapon. After Rumsfeld decided to cancel the project, White continued to give Congress his honest opinion that the weapon was vital to the army’s future. Lying can’t be justiﬁed to keep one’s job. When Bob had to testify on the Defense Department’s budget request, he was able to stay out of ethical trouble and job trouble by explaining why he couldn’t answer the question. When asked by a member of Congress for his personal opinion, he avoided opposing the administration by explaining that his personal opinion wasn’t relevant, that his job was to be an advocate for the President’s budget. His phrasing always got him oﬀ the hook. Had Congress insisted on getting his personal opinion, he would have been obliged to give it truthfully, whatever the consequences. So out-and-out lying is wrong, except for the few circumstances described above. But what about the “white lie,” the lie to avoid hurt feelings? “ at’s a beautiful baby.” “I loved your manuscript.” “Your hair looks nice.” While these seem innocent, they’re not always. How to distinguish between a permissible white lie and a hurtful one? It depends on whether action can be taken on the basis of the truth or an opportunity missed because of the white lie. “I loved your book,” is a harmless white lie after a book is published, but “I loved your manuscript,” is a hurtful lie if it costs the writer a chance to correct a weakness. “Your hair looks nice,” is a hurtful lie before you leave for the appointment, when it still can be ﬁxed, but it’s a harmless white lie when you’re walking back in the door and it’s too late to do anything about it. Sometimes failing to speak up can be halfway to a white lie. Our friend Rachel wanted to avoid hurting her friend Kate’s feelings by pointing out that Kate’s son, Ryan, was unusually aggressive and deﬁant, even for a four year old. So she kept quiet
“I’ve got something to say that might be painful to hear. would he be having less diﬃculties in school now?” As the dictionary says. So. and I feel I have to be honest with you.e Ethics Challenge about it. But I feel bad that I waited so long. She knew the danger because of the negative way she herself had reacted to the few who dared to even hint at criticism of her darling Amy. representing yourself diﬀerently from the person you really are is unethical. But the more they were together. Rachel and Kate are closer than ever now. If a person comes to an 87 .” She went on to explain her concerns. If I had mentioned it earlier. I could tell there was something oﬀ with Ryan for a good eighteen months or so before I said anything. and there was a time element to it. I’m concerned about your son. appearances can lie. in this sense. Rachel analyzed her behavior this way: “I felt good that I’d been the friend that I’d want somebody to be to me. and Kate didn’t seem to notice anything wrong. Rachel was reluctant to say anything that might hurt Kate’s feelings or might lead to the end of their friendship. and Kate listened and heard. She had to speak the truth. but I love you. Rachel was more certain than ever that he needed therapy and probably a special education program. ough it isn’t unethical—and may even be advisable—to appear neat. a slippery slope of trying to appear someone you’re not. Months went by. I still did Kate a disservice by waiting so long to tell her my thoughts. Ryan was getting worse. She met Kate over coﬀee. Soon Ryan was in therapy and in a special individual education plan at school. Rachel decided she’d be doing her friend a big disservice if she continued to say nothing about Ryan. e situation with Ryan had a chance to be changed. and it may cause you to hate me. Fixing one’s hair into a more conservative style before an important appointment is a special kind of deception. the more convinced Rachel was that there was something wrong with Ryan.
keep them shined on the job. the boss is entitled to not expect her to show up for work with rings in her nose. It’s neither legally nor ethically excusable. When ﬁrst we practice to deceive.”27 Lessons from Chapter Twelve Lies. and Shiny Shoes • • Be very careful about agreeing to conﬁdentiality. but a lie nonetheless. Steer clear of the slippery slope of deception. Lying in a greater cause (like protecting the President or the company’s reputation) is still lying. Best to stay oﬀ the slippery slope. the employer can assume that we’ll dress professionally on the job. “Oh what a tangled web we weave. and eyebrows A prospective employer is entitled to think that what he or she sees is what he or she will get. White Lies. It’s a common enough lie. and Shiny Shoes interview with her face scrubbed clean and piercing-free.Chapter 12: Lies. If you shine your shoes for the interview. White lies can do damage no less than just plain lies. If we dress professionally for the interview. lips. • • 88 . White Lies. Otherwise we’re lying. If we’re planning to come to work in jeans. then we’re obligated to come to the interview in jeans. It has the potential to compromise you ethically.
Part 4: Ethics Around Us Ethics Around Us Part 4 89 .
Just don’t hit below the belt.). We’ve thought these things on occasion ourselves and wondered if perhaps the principles of ethics that govern other endeavors apply diﬀerently to politics. Touch gloves at the start in an imitation of handshaking. You might think of them as “other. So we were surprised to come across an item in the Des Moines Register of November 9. the Business Roundtable. then ﬂail away at each other. the banks. then at the University of Wyoming. because you cannot have one without the other—as much as you might like to do so. and subvert the electoral process to stay in oﬃce.Ethics in Politics Alan Simpson left his seat as United States senator from Wyoming to teach. take bribes. do the bidding of evil pressure groups (take your pick—the National Riﬂe Association. ﬁrst at Harvard. the AFL-CIO. “You cannot hate politicians and love democracy.” a species apart. 91 Chapter 13 .” Hating politicians would be easy. lie about their opponents. He tells students. Perhaps politics really is a contact sport—like boxing. the teachers union. especially if you don’t know any. trying as best you can to cause enough brain damage—preferably temporary—to cause your opponent to fall and not get up until after the referee has counted to ten. etc. 2006—two days after election day—summarizing the just-concluded campaign for Iowa’s second congressional district seat. people who enrich themselves at public expense.
I never talked with my opponent during the campaign. (Imagine if President Bush had taken a strong principled position against the scurrilous campaign of the “Swift Boat Veterans for Truth”— what eﬀect that might have had on the temper and integrity of the 2004 presidential campaign and of politics in general. but Leach prevailed on them to not run it. attempting to spell out their policy diﬀerences rather than engage in attacks. David Loebsack.” Not exactly the same thing as ethical. Leach viewed the ad as beyond the bounds of his integrity. had signed a mutual nonaggression treaty? “No. I don’t know what he was thinking. We went to see Jim Leach.” “Polite. e state party prepared an ad lambasting Loebsack for his stand on the issue. “I’ve always believed in the philosophy of [Christian theologian] Reinhold Niebuhr. believing that policy provided the greatest chance for consensus among a broad public.” Leach explained. he was told it was the RNC’s decision. During the campaign.Chapter 13: Ethics in Politics “Loebsack and Leach ran what were seen as polite and civil campaigns. Leach favored civil unions. “It’s hypocritical to demonize a view that’s not 92 .” “Civil. When Leach objected. now an exRepublican congressman teaching at Princeton. “I read them the riot act. Loebsack said he favored legalizing gay marriage. why should he object to a campaign ad attacking his opponent for favoring it? He explained. but worth a closer look. ‘ e temper of and integrity with which the political ﬁght is waged is more important for the health of our society than the outcome of any issue or campaign. I wouldn’t caucus with the Republican party. If they put this out.” at ended it. not his. en the Republican National Committee decided to run the ad. I can only talk about my campaign. Perhaps he and his opponent.’” Leach went on to give an example.) But since Leach opposed gay marriage.
would go far to eliminate the ethical tension politicians face when they are dependent on contributions and then have to make decisions that aﬀect the interests of the contributors.” Leach’s rule. “We try to be ingrates. Clearly it’s wrong—and we believe. A few years ago. Large money giving establishes an implied contract between the giver and the recipient. and these oﬃce seekers are going to remain in a compromised situation. and sometimes we fail. he voted his conscience against a bill to outlaw 93 . no out-of-state money. if widely followed. to vote against his conscience and for the interest of his contributor. Congressman Barney Frank (D-Massachusetts) explains this tension.” Jim Leach doesn’t ﬁnd Frank’s formulation convincing.” To Leach.” For now. and no big contributions. the future to the implication it will be matched again and again if the recipient follows the unstated rules. and this contract has a past and a future. Curt Pringle is mayor of Anaheim and our colleague on the governing board of the Ukleja Center for Ethical Leadership at Long Beach State. e past relates to the initial contribution. they are denying human nature. we’ll have a system where campaign contributions are needed by people seeking elective oﬃce. We ask people for ten thousand dollars.e Ethics Challenge radically diﬀerent. and then we try to behave as though we’re not obligated to them. and it’s especially oﬀensive to use an ungenteel technique against a genteel individual. But it would be terribly unfair to judge a politician unethical for voting his conscience when it favors a contributor. valuing the temper and integrity of the campaign above the result also meant an uncommon approach to funding his campaigns. as a member of the California legislature. “When I hear a congressman or senator on television saying with a straight face that no campaign contribution ever inﬂuenced their vote. and probably for a long time. We strive for this. “My rule was no PAC money. very rare—for a politician to sell his vote.
and the bill was a middle ground—it helped a variety of interests. Kanjorski was moved to action by an alarmingly fast-growing number of foreclosures in his district.Chapter 13: Ethics in Politics smoking in the yard of a home that is used as a day care facility. putting them into the ethically compromising position that Barney Frank described. Later. “ e contributions followed the actions. not vice versa. “People in my district were hurting. he got more money from big tobacco than any other oﬃce seeker in America.” he explains. and he got some tar thrown at him for being the tool of the lenders. even when no children are present. or is that selling your vote for theirs?” U. in the year he became Speaker of the California House of Representatives.. “How about the member who votes against his conscience because the polls say that’s what most voters favor? Is that ethical. Politicians have to raise money. but he’s something of a libertarian and didn’t believe that government needed this coercive measure. “If anybody was anybody’s tool. Many honest politicians are unfairly criticized for voting with “special interests” when the special interest money chases the candidates—as in Curt Pringle’s 94 .” Voting one’s beliefs is Curt’s idea of an ethical politician. He was reviled as a tool of big tobacco. Tobacco companies rushed to contribute to Curt’s successful reelection campaign. I was voting my beliefs before I got any signiﬁcant tobacco money. it wasn’t me. And Curt suggests that there’s more than one way to sell your vote. Curt’s not a smoker. from the hundred dollars it might cost to print handbills in a township election to hundreds of millions for a presidential election.” It takes money to wage a political campaign.” Curt explains. the subprime lender that collapsed early in 2007. Was he? “On the contrary.S Congressman Paul Kanjorski (D-Pennsylvania) voted his beliefs in 2007 when he cosponsored a bill on subprime loans. He later received forty-two thousand dollars in campaign contributions from New Century Financial Corp.
Members of Congress who speak against the war in Iraq are often accused of betrayal of our gallant ﬁghting men and women. what kind of person would oppose full beneﬁts for all our nation’s disabled veterans? Anne Northup. some to increase the budget more slowly. She cast dozens of votes. citing Barack Obama’s success in fundraising as an example of the new method. where she helped shape a VA budget that was growing rapidly because of the war. YouTube and the Future of American Politics. former senior policy advisor to Vice President Gore and coauthor with Michael Hais of Millennial Makeover: MySpace. Ex-congresswoman Anne Northup (R-Kentucky) was a member of the House appropriations committee dealing with veterans aﬀairs. While candidates have to raise money. Morley Winograd. suggests that we could escape—or at least improve—the ethical swamp of special interest money if enough individuals participated in the ﬁnancing of campaigns by contributing small amounts. and hence inﬂuence. even though they may be advocating a course that they think will save many of their lives. motivate. they don’t have to demonize their opponents. Our friend. In the closing days of the 2006 election campaign. would then greatly exceed that of lobbyists. she was the target of a television commercial with this script: “With over 20. and aggregate small donor contributions. but 95 . A favorite topic at this writing is support of America’s soldiers and veterans. including some to increase the budget faster. to use Jim Leach’s term. Northup voted against giving all veterans their full disability and retirement beneﬁts. or to exaggerate their adversary’s position to just short of lying. He points to the Internet and today’s netroots politics as an eﬀective and eﬃcient way to reach. eir money. She was endorsed for reelection by the Veterans Of Foreign Wars.000 of our ﬁnest injured in Iraq. e system of campaign ﬁnancing contributes mightily to the cynicism with which a majority of Americans view their government and their elected oﬃcials.e Ethics Challenge case—rather than vice versa.
looking for help. to demonize a view that’s not radically diﬀerent from yours. they just need to stop accepting 96 . We need have little patience with bribery or extortion—instances of such venality are rare and are severely punished. We readily accept the need for oﬃce seekers to solicit campaign funds. Tom Marshall. one must accept the fact that adversary advocacy activities will inevitably involve some level of posturing. We think it’s ethically more justiﬁable to accept campaign contributions from special interests than it is to lie about one’s opponent—or to exaggerate her position as “anti-veteran.com. ousands of soldiers injured.” While we often accept “posturing. creator and author of the website. but it’s harder to accept why they accept—or worse. in Jim Leach’s term. Tickets to major sports events. Anne Northup. looking out for herself. and one congresswoman. lavish entertainment—these are the currency of corruption. “ is is truly confusing territory ethically. perhaps we shouldn’t. While political opposition and partisan advocacy are among the strengths of the American system.” or. and partisan warfare.Chapter 13: Ethics in Politics Northup voted to raise her own congressional pay. Another area where politicians are criticized for behaving unethically is enriching themselves through their oﬃce. bluﬃng. and nobody who’s thought about the ethics of accepting them has any excuse for it. because if one will concede that the occupation of politics is a necessary one and not inherently wrong. and partisan warfare” as part of politics as usual. wrote about adversary politicking over the ﬁring of United States attorneys. ethicsscoreboard.” Northup lost her congressional seat in a close election where she may well have been defeated by the scurrilous ad. bluﬃng. www. the demonization of Northup is an example of crossing the line. transportation and accommodations at luxurious resorts. If politicians object to being labeled as crooks. solicit—gifts from people who want to inﬂuence them. even though it’s not clear exactly where the “line” is. cases of wines at Christmas.
Stalin and Mao would have been impressed. and 52 assemblymen. a year when the nationwide vote for the House of Representatives was very close (51 percent to 49 percent for the Republicans). only three incumbents lost their seats out of 369 running for reelection.e Ethics Challenge beneﬁts—other than legal campaign contributions—from people who want something from government. Politics—the way we govern ourselves—doesn’t seem to provide much encouragement to people seeking a more ethical world. where an especially controversial midterm redistricting led to the defeat of four targeted Democrats. Today’s rare cases of political bribery. the representatives choose their voters. In California in 2008. One last reason to dislike politicians is that members of Congress and of state legislatures have found a way to disenfranchise voters by the ancient art of gerrymandering. 9 state senators. It’s been said of our elections that rather than the voters choosing their representatives. we can reassure ourselves a bit with the words of Oliver Wendell Holmes. and embezzlement are small potatoes compared to the Teapot Dome scandals of the 97 . the incumbent party has a 981/2 percent chance of holding on to each seat. 2006. theft. But before becoming too pessimistic. every incumbent running for reelection won—51 congressmen. most members of both parties running for reelection didn’t have to worry. and of 399 running. Nearly 90 percent won by landslides. 2004. And only nine seats have changed parties in 648 California legislative and congressional races in the last four election cycles (2002. In 2004. “I ﬁnd the great thing in this world is not so much where we stand. as in what direction we are moving.” History teaches us that these aren’t such bad times. Or almost. Or looking at it like a betting person. Outside of Texas. only seven lost their seats. and 2008) combined. While Americans scorn foreign dictators who proclaim themselves president-for-life. we tamely re-elect legislators-for-life. e situation was the same in many states.
98 . openly circulated anti-Catholic literature and whispered that the Pope had his bags packed. which gave new meaning to the word “boss. or the early.” While most politicians weren’t crooks. ready to come to Washington if Smith was elected. Congress has enacted new restrictions on gifts and junkets for legislators. and their criminal behavior is more likely to be nailed by today’s aggressive prosecutors. adultery. and not drift. and Kansas City. to Holmes’s “port of heaven. So things are getting better.scarcely a possibility that we shall escape a Civil War.Chapter 13: Ethics in Politics Harding administration. John Adams’s supporters in his 1800 presidential campaign wrote that if omas Jeﬀerson was elected. but we must sail. Politicians’ misdeeds are much more likely to be made public by today’s investigative media. New York. Jersey City. and the nation black with crimes.” How would we get there. America’s ﬁrst Roman Catholic major party candidate. is little bit of transparency is a good thing. rape. e air will be rent with the cries of distress. . Chicago. nor lie at anchor. most campaigning was ugly. it’s worth heeding the rest of Justice Holmes’s thought.and mid-twentieth-century corruption of political leaders in Boston. “To reach the port of heaven..” where politics is ethical and politicians are respected for their integrity? We need to change the way our political leaders are elected so they are legitimately chosen and are seen to be so. “Murder. and the sleazy congressional practice of secret “earmarks” in appropriation reports beneﬁting contributors or legislators themselves is being modiﬁed to identify the sponsor. however. After a short bit of self-congratulatory applause.”28 For his part. we must sail sometimes with the wind and sometimes against it.. and incest will all be openly taught and practiced. robbery. Jeﬀerson gave as good as he got. the Hoover campaign against Al Smith. the soil will be soaked with blood. As recently as the 1928 election. For example.
if any. and there is public appetite for more. since 1980. Some reforms have been made. and the real contests.e Ethics Challenge Jim Leach has spent a lot of time thinking about how to clean up the American political scene. He has a four-point proposal: 1) Elimination of all PAC giving 2) Public funding of elections. in Justice Holmes’s phrase. At least fourteen other states have redistricting reform under consideration. a nonpartisan Legislative Services Bureau has drawn the district lines in accordance with four criteria set out in law: 1) population equality. 3) unity of counties and cities. at seems to be what happened in Iowa. California voted 51 percent to 49 percent to take the power to set state legislative district boundaries away from legislators and give it to a nonpartisan commission. and 4) compactness. In today’s gerrymandered nation. Nonpartisan redistricting will encourage candidates for oﬃce to run more civil campaigns. Changing the method of drawing district lines will have a beneﬁcial eﬀect far beyond just making lifetime incumbency rare. and 4) Establishment of nonpartisan commissions in each state to draw district lines. 2) contiguity. where. But what’s a person who wants 99 . either full or partial 3) A Constitutional amendment authorizing federal and state legislatures to place limits on how much an individual can put into his or her campaign. the districts are overwhelmingly Democrat or Republican. because they will need to attract voters from the center of the political spectrum. And in 2008. America seems to be sailing with the wind. As of mid-2007. are in the party primaries.
Chapter 13: Ethics in Politics to be ethical and to be governed in an ethical way to do in the meantime? Don’t treat politics as a spectator sport. the way you play the game matters as much as the ﬁnal score. A politician who votes the way the polls lean may be selling his vote.” So if your candidate plays dirty. play by the rules. by being deceptive. respect your opponent. 100 • • . Be less tolerant of your candidate’s unethical behavior than of the opponent’s. which Jim Leach called to our attention. Politics is a participatory sport where winning isn’t the only thing—how you play the game is more important. Lessons from Chapter Ethics in Politics • • irteen Don’t always think the worst: usually political contributions are the result. one where you try hard. In politics. call him or her to account. e best advice we’ve run across is that of theologian Reinhold Niebuhr. Say you don’t like it—that’s particularly eﬀective if you’re a contributor. and be a good winner or loser. It’s worth repeating. If the behavior continues. exchanging it for yours. Respect conviction. or rather. We believe it’s more like a participatory sport. by demonizing a decent opponent. Reinhold Niebuhr was best known for relating his Christian faith to the reality of modern politics. vote for the opponent. “ e temper of and integrity with which the political ﬁght is waged is more important for the health of our society than the outcome of any issue or campaign. rooting for your candidate and closing your eyes to your side’s underhanded behavior. not the cause. or by any other practice you’d not consider using yourself. of politicians’ votes.
ough there were no rules compelling the outcome to be changed. “After reviewing game ﬁlm on Monday.How You Play the Game After fourteen straight wins. he let the players make the decision on how to handle the situation. en a delay of game penalty moved the ball back to the six. defending national champions and rated number one by the Associated Press for the past three weeks. with forty-ﬁve seconds left. Cornell voted to forfeit the contest. Fourth down. the Big 101 Chapter 14 . trailed Dartmouth. and with three seconds left on the clock gave Cornell a ﬁfth down. “After Snavely called a team meeting later that day. as referee Red Friesell had lost track of the downs. in the next-to-the-last game of the season when they got the ball deep in their own territory with four and one-half minutes to play. Coach Carl Snavely and acting athletic director Robert J. Incomplete pass. Final score: Cornell 6 Dartmouth 3. Kane wired Dartmouth oﬃcials to tell them Cornell scored on an inadvertent ﬁfth down. Time out. which the Big Red converted into a touchdown as time ran out. 3-0. ey drove to the Dartmouth six-yard line. in an unprecedented act of sportsmanship. the number one football team in the nation in 1940 was about to fall. ﬁrst and goal. Cornell. e Cornell Media Football Guide describes what happened next. But the oﬃcials had lost track of downs. ree running plays took them within a foot of the goal. Led by captain Walt Matuszak.
Roddick looked at the mark the serve had left in the clay and saw that the serve—unfortunately for him—had hit just inside the line.” But Colorado head coach Bill McCartney—founder of the Promise Keepers. Fernando Verdasco. when a line judge wrongly called his opponent’s second serve out. in the ﬁnal seconds. the oﬃcials mistakenly gave them a ﬁfth down on which they scored the game-winning touchdown. served out the game and went on to eliminate Roddick from the competition. Virtue went unrewarded as Roddick’s opponent. Colorado could have done what Cornell had done years before: just say to their opponent. with dreams of a second straight national championship dashed. 31-27. Instead of keeping his mouth shut and accepting the win. After the game. (Georgia Tech was rated number one by the UPI coaches poll. tennis star Andy Roddick was a triple-match point away from winning an early match of the Rome Masters tournament. fourth in the polls in 1989. No bonus for sportsmanship. was ﬁghting for the number one spot in 1990 as they played Big Eight Conference rival Missouri. 102 . Missouri appealed. a Christian men’s organization dedicated to ethical behavior—refused to give up the undeserved win. but the National Collegiate Athletic Association ruled there was no way to change the result. e University of Colorado. history repeated itself—sort of. Roddick corrected the oﬃcial’s call. Cornell lost the last game of the season to archrival Penn. In May 2005. and ended up ﬁfteenth in the ﬁnal AP poll.” A week later. Of course there was a way.Chapter 14: How You Play the Game Red relinquished claims to the win. led to their winning the AP version of the national championship. Cornell’s national championship hopes had disappeared with their ethical forfeit of the Dartmouth game. Years later.) Should we conclude that ethics is for losers? It often seems that way. 22-20. but Colorado’s unethical refusal. e Big Green accepted the forfeit and the 3-0 victory. With Colorado trailing. “You won. followed by their winning the rest of the games on that year’s schedule.
after being pushed across the goal by his teammate? ese are necessarily gray areas. and Andy Roddick would have won his match in Rome. But is the ethical person bound to lose. like Cornell and Roddick? What about the batter who is awarded ﬁrst base because the umpire ruled he was hit by a pitch. gymnast Paul Hamm kept the Olympic Gold Medal he was wrongly awarded. and Colorado was the national champion.S. and it allowed Paul Hamm to keep his unearned Olympic gold medal. then ethics probably paid for Roddick and for the Cornell team. Our guess is that Roddick feels better about his earned victories than Hamm feels about his unearned one. So how do you decide when to cede the advantage and when not to? Some hold that ethics is universal. not his hand? Or the quarterback who scores the winning touchdown on a quarterback sneak. Cornell would have repeated as national champs. If the objective is happiness. Is the lesson that unethical behavior pays? It paid oﬀ for the 1990 Colorado team. as described in chapter 3. If you draw one card that doesn’t improve your 103 . or utility. even though he knows the ball grazed his bat. It depends on the situation. even while being careful not to cheat or take unfair advantage. at would mean defeat almost every time. when ethical behavior would have placed him second? What is the lesson from these examples? Is it that ethics pays? Surely not—if it were. it is considered skillful to fool your opponents through your facial expression or body language. Contrasting the games of poker and bridge provides a good example of how ethics can be situational. even though it is not paying oﬀ in fame or endorsements. Hamm kept the medal.e Ethics Challenge And remember how U. In poker. it depends on what you mean by “pay. A person striving to behave ethically must follow the norms of the game.” If the objective is winning any way you can. then unethical behavior often pays. and being ethical shouldn’t have to mean giving every close call to your opponent. Still. but it can’t be.
they’re part of the game anyway.Chapter 14: How You Play the Game hand. the situation becomes arguable. Over the long run they’ll probably even out. it’s unethical to convey any information or disinformation other than through the ﬁfteen words allowable in bidding: pass. In tennis. Quarterback Matt Leinart called his own number. four. We wish there were more athletes who set a standard for others to look up to. we admire Roddick for his ethical standards. and redouble. with seven seconds left. Leinart took the snap from center. and if not. six. he’ll make good calls and bad ones. Gratuitous or not. three. One school of thought holds you should accept the oﬃcial’s calls. lift or charge into him to assist him in forward progress. e runner shall not grasp a teammate. ﬁve. In bridge. e NCAA football rulebook states. But move to the bridge table and smile at your cards and your opponent will justiﬁably complain to the tournament director. and no other player of his team shall grasp. “ARTICLE 2. most players grow up playing without a referee. two. and 104 . ey make an early choice whether to be ethical. But when there is a referee. Sometimes the unwritten rule conﬂicts with the written rule. USC had the ball on the Notre Dame one-yard line. 31-28. and if you repeat the behavior. diamonds. Some would say that Roddick’s call. Every game and sport has written rules and unwritten rules. double. so they make their own in-or-out calls. no-trump. overriding the referee. good for you! People will admire and respect your poker skill. b. push. spades. clubs. hit the line. and you smile and con your opponent into thinking you’ve ﬁlled a ﬂush or full house. one. was gratuitous. they trailed. Whenever there’s a game oﬃcial. seven. hearts. a quarterback sneak for the yard that would win the game. You’ll be warned. on page 117. you’ll be barred as a cheat. right or wrong.” When the top-ranked and undefeated USC Trojans met once-beaten Notre Dame late in the 2005 football season.
It’s almost universally admired as a teacher of character. graciously ended any controversy by saying.e Ethics Challenge appeared to be stopped cold. People all over the world take sport seriously. or From Center Court to the Corner Oﬃce. Notre Dame’s Charlie Weis. the buzzword is “team. It’s becoming ever more central to our economy. Unfortunately. Nobody can remember the last time a penalty was called for assisting a runner. but that’s a heads-up play by Reggie and hopefully any running back I had would be pushing right along with them. a big winner and a bigger abuser of his players 105 . and teamwork. and Life. celebrated as he cheated his way to new home run records while lying about it Basketball coach Bobby Knight. Just a very small sample: • • Baseball slugger Barry Bonds. of fair play.” As USC fans. An unethical play? Probably. Many of today’s best coaches write business books with subtitles like Successful Strategies for Basketball. “ ey made a play and you could say Reggie pushed him. team player. leadership team. People draw many of their heroes and role models from sports. many of those we pick to admire fall short of any imaginable ethical standard. An illegal play? Undoubtedly. and of life. we cheered the last-second win in one of the most exciting football games ever played.” as in management team. Sport matters. And yet … we would have felt better about the result without the push. which he did. when halfback Reggie Bush charged into Leinart’s back and helped him roll into the end zone for the winning touchdown. Business. but the situation is murky. In business today. or Business Lessons from the Locker Room. A boss or a subordinate interested in improving performance at work often looks to the world of real teams for ideas and inspiration. e losing coach. from preschool through university. at’s why it’s an important part of every school curriculum. right after the game.
if it doesn’t. When asked whether an upcoming game was a “must-win. Sometimes it brings victory and fame.” If we are to quote football coaches.” Such thinking can justify the University of Colorado’s refusal to give back a victory it had been handed on a referee’s mistake.” Levy answered. Ethical behavior is its own reward.” Lessons from Chapter Fourteen How You Play the Game • • • In games. 106 . then it’s not a game. ethics supersedes rules. “Winning isn’t everything. let it be Marv Levy. “No. World War II was a must win. who cheated and lied about it as he won three Super Bowls Perhaps worst of all. the year after Cornell gave back its unearned victory. Grantland Rice.” a poem by America’s greatest sportswriter. and four-time loser of the Super Bowl. If you win unethically. winner of four American Football Conference championships. when American boys were memorizing lines from “Alumnus Football. Winning isn’t the only thing—how you played the game is more important. it’s the only thing.Chapter 14: How You Play the Game • Football coach Bill Belichek. A better time was 1941. you’ll feel worse than if you lose with honor. Hall of Famer and former coach of the Buﬀalo Bills. “For when the One Great Scorer Comes to mark against your name. we were mesmerized by Vince Lombardi’s most famous saying. this is a football game. He writes—not that you won or lost— But how you played the Game. sometimes defeat and obscurity.
take all your savings and buy some good stock and hold it till it goes up. Credit Suisse First Boston. Morgan Stanley. when the New York Stock Exchange and NASDAQ close their trading for the day. Merrill Lynch. if Google were to announce an unexpected jump in earnings. Goldman Sachs.M. ey were helped by every major United States investment bank: Citigroup. including Putnam Investments. If it don’t go up. Unfortunately for those who had innocently invested in these funds.” We thought it was funny even if it wasn’t practical. you actually could follow Will Rogers’s advice and make a sure proﬁt. Many super-big investors (largely hedge funds) made sure proﬁts by late trading in some of the biggest mutual funds. If you could buy it after 4 P. and Strong Capital Management. “closing” price.M. Eastern time. e scam took pennies a share from thousands of mostly 107 Chapter 15 . Janus Capital Group.Other People’s Money Will Rogers had some advice for investors. don’t buy it. Lehman Brothers Holdings. “Don’t gamble. they would do it after 4:00 P. Morgan Chase. For example.P. at the 4 P. then sell it. even though events have made the price obsolete. Late trading simply means buying or selling at a price that was set earlier. e stock would be almost sure to jump when trading opened the next morning.M. until we read about “late trading” of mutual funds. and J. the sure proﬁts came right out of their pockets.
however. that the managers of some of the world’s largest and most respected funds and banks would help sharpies to chisel—steal. maybe thousands. an assistant professor of economics at Stanford. and steps were taken to make sure it couldn’t happen again. many executives were allowed to buy 108 . Just as clearly. at is so egregious.29 It was no surprise that traders looked for and found an edge on the rest of us.”31 What were the wrongdoers thinking? What were many of the biggest names in the investment world thinking when they conspired to take money from their investors and give it to sharpies? Clearly. too. they weren’t thinking of ethics. corporations reward executives with options to buy their stock in the future at today’s price. It did surprise us. they were thinking of commissions and proﬁts. But by backdating the options. e world soon discovered that major corporations had discovered a much simpler and faster way to make money at the expense of people who had entrusted their money to them. e pros were surprised. Eric Zitzewitz. they weren’t thinking of right and wrong.Chapter 15: Other People's Money small investors and put about one billion dollars a year into the pockets of the late traders. roughout America. Violating that trust was a clear ethical failure. “From my heart I really thought these people [at the Investment Company Institute. really—from investors who entrusted their money to the funds. of people. the mutual funds association] cared a lot about their reputations and would do anything to keep the industry’s image pristine. But it turned out that the ﬁnancial community wasn’t the only gang to successfully implement Will Rogers’s gag recommendation. called the late trading “a complete shock. involving hundreds. e fund managers had other people’s money in trust—that means people trusted them to protect it. said.”30 And Arthur Levitt. e late trading scandal surfaced in 2003. chairman of the Securities and Exchange Commission from 1993 to 2001.
McGuire was far from the only CEO to defraud his stockholders this way. and all those people at all those respected companies violated this simple principle—one their whole industry is based on. and McGuire got retroactive options to buy at forty dollars. even though McGuire (with the help of his board cronies) rewarded himself with nearly three percent of the entire value of the company. McGuire got retroactive options to buy it at forty-three dollars. the champion of the backdaters is William McGuire. Why? We don’t think most of them thought they were being 109 . If the stock had already gone up. these executives could implement Will Rogers’s advice and proﬁt hugely without risk. McGuire’s backdating gained him $1. or even last year’s price. America’s second-largest managed care company.6 billion in proﬁts. As of November 2007. So far. e late trading and the backdating involved the participation of thousands of people. or 29 percent of all public corporations. In 1999. All told. after the stock ended the year at fortynine dollars per share. though. it closed at ﬁfty-three dollars. UnitedHealth stockholders had a very good year.32 Eric Lie and Randall Heron estimated that two thousand corporations. When someone entrusts their money to you. since he got to buy the $122 stock at the year’s low price of forty-six dollars per share. McGuire had a better year. repeatedly rewarded him with options recorded retroactively as of the day the stock traded at its low point for the entire year. as the stock closed at $122 per share. chairman and CEO of UnitedHealth.e Ethics Challenge stock at yesterday’s price. manipulated stock-option accounting rules in this way. In 2000. you must protect it. UnitedHealth’s board. the peak of the bull market. So in 1997. e shareholders made money and presumably were happy. more than 220 companies had disclosed internal or federal investigations into whether they backdated employee stock options to lock in proﬁts for recipients.33 e ethical principle should be pretty clear. e only beneﬁt you may get from it is the fee—if any—you mutually agree on. chaired by McGuire.
you’re risking other people’s money. using forty. Or we might borrow money to invest. with larceny in his heart.000.000. Ethics simply wasn’t part of their job. at’s roughly what Fannie Mae and Lehman Brothers were doing.100. Such is the power of leverage. we could put it into a stock. when we buy a house we make a down payment and borrow the rest.000 and investing a total of $5.000 we could invest $5.000.000. we’d have a proﬁt of $510.000 would be gone and we’d owe another $410. you’re no longer risking your money.Chapter 15: Other People's Money unethical. But when you borrow money that you can’t aﬀord to repay. say. at gives us leverage.000. America was built on borrowing and taking risk.100. We expect to pay it back.000. $100. But we can leverage our stake by borrowing. Now if our stock goes up ten percent we have twice the proﬁt. If that investment went up ten percent. either. or reﬁnance. Sometimes we borrow a lot: for example. we have a nice proﬁt of $10. ey behaved unethically (and perhaps in some cases. us when Lehman Brothers’ portfolio decreased in value by just a 110 .000 to invest. Bill Hewlett and David Packard built an industry on $538 of borrowed money and Packard’s garage. Nothing wrong with borrowing and taking risks with your money. for example. But we don’t have to stop there.or ﬁfty-to-one leverage to make huge bets and huge proﬁts during the boom years of 1990-2007. criminally) without considering questions of ethics. another $100. if our stock goes down ten percent we’d lose $510. $20. If we could borrow $5.000—that is. Using our example of borrowing $5. ey weren’t Bernard Madoﬀ. Ethics isn’t part of our job. when we borrow money.000. If we have.000. or ﬁnish making all the monthly payments called for in the mortgage. our stake of $100.000 and investing the total of $200. Such is the power of ﬁfty-to-one leverage.000. if the stock goes up by ten percent. But the problem with huge leverage is that it wreaks havoc when prices go down. We intend to repay the loan when we sell.
And a box of staples to reﬁll the stapler. Of course. More than wiped out: since it couldn’t pay its debts some of its creditors were wiped out as well. you don’t have to be a CEO or a hedge fund operator to help yourself to other people’s money or property. Had the investment bankers. Who knows how many of the staples bind company papers. It’s often easy to claim 111 . Time clocks have largely been replaced by an honor system for keeping track of hours worked. and how many your own? Ironically. mortgage lenders started to fail because they had lent to people who couldn’t pay. If you work for a company. Institutions that thought they had insured themselves against calamity through insurance behemoth AIG would have been wiped out had the United States government not pumped money into AIG to allow it to pay oﬀ its policies. opportunities to help yourself to company money or property are increasing as more and more companies understand the business value of empowering and trusting their workers. and many others— risking other people’s money.34 e government is. not a calamity. Surely the company won’t miss it if you take home a pad of paper. because after all. had it not been for people—and large institutions like Lehman. and many people would avoid calling the practice by its proper name: stealing. in the process of pumping trillions into companies that risked other people’s money and lost. hedge fund operators. As the value of houses started to fall. perhaps to use for company business. And what about a couple of ink cartridges. it would have been a setback. some of the things you print at home are really for the company. e ﬁnancial collapse of 2008-2009 was triggered by the bursting of the bubble in home prices. Taking these things is very easy to justify. chances are you’ll have lots of opportunities to help yourself to company property. and other speculators considered the ethics of this kind of risk the entire collapse would likely never have happened.e Ethics Challenge few percent the company was wiped out. While the ﬁnancial collapse started with the fall in home prices. AIG. in mid-2009. It might even be hard to draw the line between supplies meant for company business and supplies meant for your own use.
and it’s a long way from enriching oneself at the expense of shareholders in a mutual fund or a corporation you run. Some prefer to follow Sutton’s Law. including us. “What are you doing? at’s stealing!” Bob put the jams back. weren’t you thinking about work between halves of the football game last night? Temptations. Another issue arose about the time we started on this book.” Of course. Taking them would not have been a felony. He enriched the English language with his nickname. Most people.” Sutton’s Law has been adopted in medical teaching (ﬁrst perform tests that go after the symptoms). Still.” and with Sutton’s Law. not everybody follows this rule. and the simplest ethical rule is. you couldn’t do much better than to go after Microsoft. it’s other people’s property. “Slick Willie. proﬁts have grown much faster than the ability to invest. Bob hadn’t used any of the jams with his breakfast. Bob was having breakfast with his friend Phil Bloom at a fancy coﬀee shop where they provided those little individualserving jars of delicious Knott’s Berry Farm jams. large and small. or even a misdemeanor. so-named after a journalist misquoted him as saying that he robbed banks “because that’s where the money is. Phil blurted. Willie Sutton was America’s most famous bank robber. So it shouldn’t have surprised us a couple of years 112 . and in the bringing of class-action lawsuits. “What’s theirs is theirs. If you’d like to bring a class-action lawsuit. robbing about one hundred banks between the late 1920s and 1952.Chapter 15: Other People's Money an hour or two of overtime—after all. in cost accounting (measure costs where most of the money is being spent). are everywhere. As of June 2008. We wrote in chapter 1 about the temptation not to own up to a scraped fender on a rental car. but they were so good that he picked up two from the serving bowl and started to put them in his pocket. wouldn’t think twice about its being even a small ethical violation. Microsoft’s balance sheet showed cash and other liquid assets of more than $23 billion.
anymore than we felt victimized by Netﬂix.5 million to provide the upgrades). which was less than half the $270 million they had requested. And of course. but in fact costing Netﬂix very little—they’ve estimated no more than $1. along with the coupons we get almost daily for discounts on car rentals. about ﬁve dollars. $3. e letter explained that we were entitled to rebate coupons worth between ﬁve and twentynine dollars on future purchases of Microsoft products. 113 . Netﬂix isn’t as ﬂush as Microsoft—the company’s most recent balance sheet showed liquid assets of $417 million—but they’re ﬂush enough to attract legal practitioners of Sutton’s Law. the lawyers got $112 million. Visa. but deliveries were not “unlimited”—they were limited by mail deliveries and by what the lawyers alleged was a purposeful delay by Netﬂix in mailing out replacement DVDs. e plaintiﬀs argued that Netﬂix advertised unlimited DVD ﬁlm rentals. and canned tuna ﬁsh. or any of the other companies that were the subjects of dozens of similar letters we received in recent years. partner in Townsend and Townsend and Crew. which we would probably have put away somewhere and forgotten about.000—not a bad application of Sutton’s Law.000. and the members of the injured class were getting a little. on paper. We checked the Microsoft settlement and found—no surprise—that the lawyers were getting a lot. In contrast to the rebate coupons we were being oﬀered. or $19. Nordstrom.019 for each of the 6.e Ethics Challenge ago when we—along with fourteen million other Californians— got letters in the mail identifying us as members of a class of consumers that had been victimized by Microsoft’s overpricing of its Windows and Oﬃce software. but settled by agreeing to give us “injured” class members a one-month free trial of a oneDVD-per-month upgrade (worth. the lawyers—they got $2.198 hours he billed on the case. According to Microsoft. the requested fee would have paid our lead attorney. but we didn’t feel like victims.528.771. timeshares. we gripe about Microsoft as much as the next person. Now. Eugene Crew. e company admitted no wrongdoing.
which boasted of collecting $45 billion in class-action awards and settlements. it’s not surprising that some lawyers went beyond even what the law allows. Class-action suits involving tobacco and asbestos have beneﬁted people gravely injured by those products to the extent of billions of dollars. illegally compensating “expert” witnesses. the settlement distributed $4. to go where the money is. A nation of laws needs lots of lawyers to prosecute and defend 114 . Because courts were holding that the attorney who ﬁles ﬁrst gets to represent the whole class. Of course. A class-action suit against Nordstrom resulted in the distribution of about four thousand dollars each to two thousand deserving employees who had unfairly been denied overtime pay. e champion of class-action lawsuits is the law ﬁrm Milberg Weiss. With such wealth to be made through meritless lawsuits. You could claim to be injured by a doctor or an automobile driver and hope to extract a substantial sum from the insurance company in exchange for dropping your suit. For example.8 million. Setting aside criminality. class-action lawyers often legally pick the pockets of members of the injured class.Chapter 15: Other People's Money Clearly. Or you might sue McDonald’s for making you fat by selling you too many French fries or for burning your tongue by selling you coﬀee that was too hot.8 million to lawyers. and committing a range of other crimes. for which several partners are in jail and others are under indictment. You don’t have to ﬁle a class-action suit. not all class-action lawsuits wind up beneﬁting only the lawyers.5 million came from the shareholders’ assets. of course. when Nordstrom settled a shareholders suit out of court. so they came out of a “winning” lawsuit a net loser of $2. Unfortunately for the “winning” shareholders. the lawyers were following Sutton’s Law. the entire $7. Milberg Weiss decided to tilt things further in its favor by perpetrating widespread fraud: paying people to allow their names to be used in ﬁrst ﬁlings of lawsuits. because the proceeds come out of the classes’ own pockets.7 million to the shareholders and $2.
Best to not go after other people’s money.e Ethics Challenge people in criminal court. We like the advice of former Justice Potter Stewart. ey’re the twenty-ﬁrst century’s equivalent of the highwaymen and train robbers of earlier times who went where the money was. If you paid more than you should have for something. toss the invitation in the trash—even though you have every right to participate. it’s not all right to risk other people’s. Ethics is knowing the diﬀerence between what you have a right to do and what is right to do. at doesn’t excuse anyone’s following their examples and taking things large or small. and to interpret and advise on the law. “What’s theirs is theirs. If you gobbled down a super-size order of fries. If invited to participate in a settlement for which you suﬀered no injury. even if you legally could.” It’s all right to risk your money. take responsibility for your gluttony. to craft agreements and contracts. 115 . Lessons from Chapter Fifteen Other People’s Money • • • • Many leaders in business and ﬁnance have been helping themselves to investors’ money—some without penalty. think of it as your mistake. But increasingly America has lots of lawyers to go after other people’s money. When it comes to other people’s property. the simplest ethical rule is. not as corporate wrongdoing.
“Were it left to me to decide whether we should have a government without newspapers or newspapers without a government. Congress shall make no law respecting an establishment of religion. 117 Chapter 16 . or prohibiting the free exercise thereof. or abridging the freedom of speech. like the story Mitch Albom. I should not hesitate a moment to prefer the latter. trivialization. or of the press. and to petition the Government for a redress of grievances. author of worldwide bestsellers. Fabrications include lies small enough to pass as ﬁbs.Ethics and the Media Knowing the diﬀerence between what you have a right to do and what is right to do has a special resonance when it comes to the media. It’s easy to forget as we experience daily exposure to fabrication. and defamation in the media. or the right of the people peaceably to assemble. Jeﬀerson valued press freedom even more. wrote for the Detroit Free Press about two former Michigan State basketball stars dressing up in green and white to cheer on the Spartans as they played for the national collegiate basketball championship. e founding fathers considered press freedom of transcendent value when they enshrined it in the ﬁrst amendment to the Constitution.” Remember that.
hadn’t dressed in green and white. Social Security. housing. and hadn’t even been there. the Times is far from alone when it comes to such reckless disregard for fairness to public ﬁgures. use 118 . Other fabrications have been blockbusters. aging. Sometimes the press reports things that aren’t true—the Duke lacrosse team didn’t rape a dancer they hired for an alcohol-laced party. the substance was trivial. e State of the News Media 2008 reported that less than one percent of newspaper columns and television newscast time went to each of these subjects: education. Important issues go uncovered. or cheered. and abortion. and ex-Governor Eliot Spitzer’s sexual tastes. But more frequently the media victimize public ﬁgures by more subtle slurs—truths that appear incriminating just because they are published. But so what? Who cares whether they were there. 35 And then there’s defamation. Or Janet Cooke’s made-up stories about an eight-year-old heroin addict in e Washington Post that won a Pulitzer Prize. labor. the legal system. Government oﬃcials are especially fair game. gun control. or dressed in green? e lie was the important thing. We wrote in chapter 8 about the Los Angeles Times reporting of Los Angeles Police Chief William Bratton’s perfectly appropriate use of police helicopters to travel across the city: it appeared improper simply because it was reported. welfare. like Jayson Blair’s ﬁfty-two made-up stories in e New York Times about the Washington Beltway sniper killings that electriﬁed the nation in 2002. religion.Chapter 16: Ethics and the Media It turned out that they hadn’t cheered. And there was no evidence to support the New York Times suggestion that John McCain had an aﬀair with a female lobbyist. like the twenty-four/seven coverage of Anna Nicole Smith’s estate. Britney Spears’s parenting. Richard Jewell didn’t place a bomb in a trashcan at the Atlanta Olympics. race. transportation. Bratton’s helicopter travel. Much more frequent than outright fabrications is the trivialization of the news. drug traﬃcking. How many readers must have assumed malfeasance just because it was in the paper? Sadly.
educated in a radical madrasah in Indonesia. we can get detailed and intensive coverage of the subjects that are of special interest to us. there are many encouraging signs. while Bob follows the workings of the federal government. We can follow our favorite sports teams and read columns by columnists who exaggerate their quality to our delight. In spite of the media’s sins and their fall in the public opinion polls. us Mick follows the real estate market. Do you lean left? Soak up talk shows and web pages that explain how George W. more biased. and generally more harmful to democracy than they did two decades ago. Learn that Barack Obama is not only a liberal but also a secret Muslim. Many papers employ ombudsmen to criticize the paper when they see bad reporting or bias in coverage and oﬀer op-ed space to opposing viewpoints. is driving Americans increasingly toward getting their news from a sort of “Daily Me”—a personal selection of oﬀerings that please them. and truer reporting. and all sorts of government expenditures are made to appear improper simply because they’re in the paper.e Ethics Challenge of earmarks by members of Congress to fund legitimate public needs. But the profusion of news sources has another side: e worsening reputation of the media. More seriously. which can lead to deeper. less moral. But it’s too easy for the “Daily Me” to become so one-sided that it erodes the sense of community that binds our society. broader. Bush lied to America and opened the public purse for Dick Cheney’s friends and paymasters at Halliburton to plunder. If 119 . e “Daily Me” has some advantages. Some TV stations oﬀer regular airtime. e media don’t get oﬀ free for their misbehavior. And the profusion of news sources available from cable and satellite television and the Internet ensure lots of competition. Are you of the political right? Get your news from sympathetic sources. together with the inexorable advance of the Internet and talk radio. State of the Media reports that Americans consider journalists less professional.
If we hear or read. e Golden Rule demands that we mentally put ourselves in their place. or Merck.”36 120 . over and over. or politicians. and exclusively. that Bush is a monster. If enough of us fail to meet this obligation. But America is becoming less and less a land of shared experience. or trial lawyers. schooling. we begin to lose our ethical bearings. In a community. As is so often the case. or the AFL-CIO. and gated communities. or Obama. we begin to lose patience and sympathy for other points of view and for the people who hold them. or Clinton. and political beliefs. neighborhood. Philosophers from Hegel in the eighteenth century through Hannah Arendt in the twentieth have written about the concept of “otherness. the “Daily Me” needs to reﬂect others’ views. race. We slip into thinking of these—and of people who support them—as “other. We’re increasingly a nation of many languages. society suﬀers and eventually disintegrates. But the basis for ethics—and indeed for civilization—is a respect for others and a recognition of their humanity and values. Jeﬀerson puts it best. And feelings for others is at the root of ethics. private schools. So.” not deserving our consideration. not equivalent to the “self. “I should mean that every man should receive those papers and be capable of reading them.Chapter 16: Ethics and the Media we only see one point of view.” deeming people outside the faith (or race or ethic group) to be “other”—that is. not just reinforce yours. a nation stratiﬁed by class. this is fed by shared experience: language. As citizens we have an obligation to be informed about our community and country and to understand the situation of our fellow men and women. just like a good old-fashioned newspaper.” and thus inferior and not entitled to the consideration due shared humanity. prayer. one that reinforces our own biases. and leisure.
e Ethics Challenge Lessons from Chapter Sixteen Ethics and the Media • • • Be slow to believe the worst based on media accounts. It’s an ethical imperative to be informed about your community and country. 121 . Many stories have more than one side—look for the other side.
“What writest thou?” e Vision raised its head. especially poetry. And saw. with an estimated six billion sold. Mao Tse-tung’s Little Red Book is second. and some argue that their disappearance was a key reason for the decline of public education.” was memorized by millions to whom it taught a simple and lasting lesson of ethics and religion. with an estimated 120 million sold and used in schools across America throughout most of the nineteenth and early twentieth century.Ethics and the Clergy e Bible is generally considered to be the best-selling book of all time. Abou Ben Adhem (may his tribe increase!) Awoke one night from a deep dream of peace. within the moonlight in his room. McGuﬀey’s readers have disappeared from mainstream education in America. And to the Presence in the room he said. McGuﬀey’s readers are generally considered number one or two. Making it rich. not for reason of literary merit but because it was long a criminal oﬀense for an adult Chinese not to own it. An Angel writing in a book of gold: Exceeding peace had made Ben Adhem bold. Among strictly American books. Generations of schoolchildren read and memorized selections. A poem by Leigh Hunt. 123 Chapter 17 . entitled “Abou Ben Adhem. and like a lily in bloom.
e Old Testament tells us. And showed the names whom love of God had blessed. Afghans have been killing each other in God’s name ever since.” “And is mine one?” said Abou. who gave up his throne to become a Suﬁ saint. the Afghan Shias and Sunni Muslims seem the same people.Chapter 17: Ethics and Clergy And with a look made of all sweet accord Answered. “ e names of those who love the Lord. To an outsider. “Nay. Abou Ben Adhem was a real person. To the unpracticed eye. e next night It came again with a great wakening light.” Replied the Angel. then. not so.” e Angel wrote. Write me as one who loves his fellow men. an eighth-century king in what is now Afghanistan. they look similar physically. they worship in mosques that look similar. and vanished. his descendants haven’t bought into his love of his fellow man. It pales in intensity next to the savagery between Shia and Sunni in Iraq. that the Israelites—at God’s direction—killed all the Heshbonites and Amorites in sixty cities to take their land. in Deuteronomy. “I pray thee. and the observant among them spend much of their lives memorizing the same holy book. Afghanistan’s intra-sect warfare is not unique in the Middle East. a series of nine military campaigns waged in the 124 . And. there would likely be less intolerance preached in the name of religion and more of the teachings of the Old and New Testaments and the Koran. and mosques. Abou spoke more low. lo! Ben Adhem’s name led all the rest! It’s too bad Hunt’s poem has fallen from favor. and said. Sadly. Were it widely memorized and recited today in churches. Christians elevated the art of God-blessed killing in the Crusades. nor was it invented by Muslims. synagogues. But cheerily still. But they kill each other in the name of God. Killing in the name of God isn’t particularly new.
While it’s not useful to be too judgmental of the ancients as we view their behavior through our modern-day lenses. So what’s an ethical person to do when faced with otherness in the name of religion? at’s when it’s most important to practice sameness— reminding ourselves of our shared humanity and looking for ways 125 . It’s there when homosexuality is labeled an abomination or when legislators are branded for excommunication for supporting access to abortion. killing in the name of religion is rare— non-existent in America. It survives in the preachings of some of the clergy of all faiths. Happily. they managed to slaughter tens of thousands of other Christians who practiced their Catholicism under the administration of the Eastern Church. We know that most religious leaders believe in a common humanity. where religious killing thrives as much as ever. we can search for vestiges of our ancestors’ behavior in today’s world. civilization has come a long way in four hundred years. the irty Years War between Lutherans and Catholics wiped out up to one-third of the population of Germany. Even those who do. Along the way for good measure. instead of following the “true” direction from Rome. outside the Middle East. except for an occasional hate crime by someone considered to be deranged. And otherness underlies the conviction that God gave the West Bank to the Jews so the Arabs there—others—have no right to the land they and their ancestors have occupied for centuries. Today. ey see danger where there is only diﬀerence. Later. not one person in a hundred could distinguish between the Lutheran and Catholic rites or beliefs. We ﬁnd that otherness—the idea that people who are diﬀerent from us are inferior beings—is still with us.e Ethics Challenge eleventh through thirteenth centuries to recapture Jerusalem from the Muslims. in the seventeenth century. but not all of them do. At the time. Otherness even inspires religious leaders like Jerry Falwell and Pat Robertson to establish special law schools where students can learn law unencumbered by any secular sentiment. slip on occasion. except for the name.
We need to look under the surface at a person’s true character. Shakespeare had his Shylock. do we not die? And if you wrong us. organs. properly took Mick to task. Pringle was defending his calling. subject to the same diseases. injuring. but he was making an important ethical point as well. hurt with the same weapons. a despised Jewish moneylender. aﬀections. Hath not a Jew eyes? Hath not a Jew hands. plea for sameness in the most literal way: I am a Jew. do we not laugh? If you poison us. healed by the same means.” Curt Pringle. Looking up 126 . living together. author of the bestselling e Purpose Driven Life. ey don’t agree on everything. but they agree on many things. Warren likes to emphasize things held in common rather than diﬀerences. senses. warmed and cooled by the same winter and summer. at’s why he delivered the invocation at Barack Obama’s inauguration and why he addressed eight hundred Muslim leaders at the Muslim Public Aﬀairs Council convention. Our idea of the model of sameness is Pastor Rick Warren. as a Christian is? If you prick us. Warren’s theme is about people getting along. fed with the same food. shall we not revenge? Otherness is most seriously about killing. as well. When Mick was a new minister. or segregating the other. passions. then Mick’s parishioner and Speaker of the California Assembly. dimensions. explaining privately that it was hurtful to brand politicians or any group of people as members of an inferior class. e clergy are role models in every society. Mick listened and learned. But it is most commonly much more mild. and often thoughtless. and ﬁnding areas of agreement.Chapter 17: Ethics and Clergy to reinforce it in our consciousness. he once spoke lightly in a sermon of someone “crooked as a politician. do we not bleed? If you tickle us.
people often take their sermons seriously and follow their advice. keep reminding yourself about your sameness. or with those people. Self-diﬀerentiation is hardest when facing a powerful intellectual or spiritual inﬂuence like a teacher or a religious leader. as we have seen. 127 . but that’s when it’s most important.e Ethics Challenge to them. Keep on the lookout for otherness creeping into your religious practice. But sometimes. but to remain true to his or her own inner compass. Self-diﬀerentiation— knowing where you end and others begin—is a key action for meeting the ethics challenge: to close the divide between what you believe and how you behave. Lessons from Chapter Seventeen Ethics and the Clergy • • • • Don’t confuse diﬀerence with danger. to act not as a member of the congregation or crowd. In the face of otherness. they are not to be emulated. it is crucial for an ethical person to self-diﬀerentiate. Self-diﬀerentiate: don’t let any one or any group override your inner compass. In those times.
In other words. who argued that man naturally attempts to maximize happiness. or rule-based ethics. It is ethical to jaywalk because you gain time and no one loses time. 2) Categorical. 1) Utilitarianism. sometimes called consequentialism or teleology We referred to this theory in chapter 3. and virtue: and with theories with Greek-sounding names. Kant argued that an action is ethical only if it would be acceptable for universal practice. which Bentham called utility. like morals. At the risk of wild oversimpliﬁcation. it is unethical to jaywalk because 129 Appendix . e utilitarian theory of ethics says that an action is ethical if its consequence is to increase total human happiness. Let’s test this theory by applying it to jaywalking. values.Appendix: The Three Theories of Ethics The Three Theories of Ethics e ethics literature is replete with confusing and overlapping terms. Its origin is in the writings of Jeremy Bentham (1748-1832). and no one is less happy. we’ve boiled down the literature to three widely accepted theories of ethics. integrity. You are a little happier. how would it be if everybody in the world did this? us. sometimes called deontology is is often attributed to Immanuel Kant (1724-1804). so the world’s total happiness increases.
Diﬀerent from utilitarianism. We have based our approach on virtue ethics. 3) Virtue ethics is is the fuzziest of the three theories. e best deﬁnition we have found is perhaps the simplest: commitment to the Golden Rule. Immanuel Kant. which is based on consequences. virtue ethics says that ethical behavior is what follows from a virtuous character. 130 . they can also support unethical behavior. What’s worse. which is based on rules.chaos would result if everyone in the world would jaywalk all the time. but few would argue that it’s an ethical act. people have wrestled with how to deﬁne virtue. and ever since. but at the same time the most useful. For example. under utilitarianism it can be argued that murdering a rich bachelor and distributing his wealth to the poor increases human happiness. and from categorical ethics. Virtue ethics started with Plato and Aristotle. categorical theory is just as fallible as utilitarianism. famously argued that it would be unethical to lie to a would-be murderer who asks where his intended victim is hiding. Categorical ethics theory would rightly conclude that such an act is unethical. e two theories often lead to such contradictory conclusions. However. its founder. while often testing our assumptions against the other two theories.
18. 118-119 bribe. 130 Armajani. 36. 44. 43. 61. 91. 92. Hannah 120 Aristotle xiii. 91-98. 54. Reggie 105 Business Roundtable 91 California xiii. 64-65. 80-81. 14. Armi 12 army 43. 53 Adams. Jack 65 Abu Ghraib prison 36. 85-86. 47 class-action lawsuit 112. 106 131 . 53. Norm 61 college ﬁnancial aid 60-61 Colorado. 87. 103-106 Cheney. 22. 73. Solomon 36 AT&T 61 backdating 108-109 Belichek. 142 Bratton. Scott 46 Adelphia 25 AFL-CIO 91 Albom. 119-120 Bush. 120. 114 Clinton. Bill 30. 146 Carter. 119 Churchill. 85. 13. 12. Janet 118 Cornell 101-103. 117. 67-69. University of 102-103. 141 code of ethics 5. 19. Jeremy xiii. 129 Berra. 119 conscience 12. George W 85. James 34-35 Bush. Phil 112 Bloomberg LLC 45 Bloomberg. Dick 85.Index Abou Ben Adhem 123-124 Abramoﬀ. 113. 97 bridge 103-104 Brown. 59. Yogi 49 bias. Michael 45 Bonds. 93-94 Cooke. John 98 Adams. 96. 106 Common Good 79 Congress 59. Yul 9 bureaucracy 4. 19. Winston 84 Citigroup 107 civil unions 92 clarity 27-29. 23. 14. 18. biases 57-62. 32-33. 66. Mitch 117 Alcoa 45 American Federation of State. 83. James 80 categorical ethics 129-130 cheat xv. 63-64. 20. 141 Asch. 69. Bill 106 Bentham. Barry 105 Bonita Bay Group 43. 97. bribery 2. 15. 25-26. Charles 61 Brynner. 85. 28 cheating 17-22. 16. 78. 80 Burke. 81. William J. County and Municipal Employees 61 Anaheim 3. 93 Anaheim Angels 3 Arendt. 93-94. 99. Jayson 118 Bloom. 67 Coleman. 86. 119-120 Bible 123 Blair. 73. Jimmy 83 Carville.
98 Golden Rule 10-11. 13. 141 DeLay. Eugene 113 Crusader artillery weapon 86 Crusades 124 Cummins 6 Cunningham. Duke 65 Cuomo. Bill 50 Crew. 49. 145 ethical courage 31.P. 18. 35. 63-64 Howard. Leigh 123-124 insurance 1. 120. 94-99 emotional intelligence 31 Enron 25. 74-75. Tom 65 Des Moines Register 91 Detroit Free Press 117 Dilbert 46 dilemma xiii. 85. Jerry 125 Faulkner. 130 Goldman Sachs 107 Goldwyn. xvi. 129 integrity gap xv. 74. 42 Falwell. Philip 79 Hunt. 21. Michael 95 Hamm. Morgan Chase 107 Janus Capital Group 107 Jeﬀerson. Oliver Wendell 97-99 Honeywell 44. Archibald 49-50 Credit Suisse First Boston 107 Creech. 98. 74. Al 61 Galford and Drapeau 35. Attorneys 96 football 4. 44. 63. 100. 103 happiness 19-20. 34. 21-22. 60. 88 Defense Department 2. xvi. 61. 129-130 Harding administration 98 Harrison. 43. 64 Hegel 120 Heidrick and Struggles 28 Heron. 63 gay marriage 92 General Motors (GM) 74 gerrymandering 97. xvi. 119 elections 17. 146 Jeopardy 21 Jesus 10. 14. 112 foreclosures 94 Frank. 21. 145 Garrett (Corporation) 12. Mark I. 85 dining halls 44 Disney 41. 101106. Samuel 49. 26. 87. 120. Randall 109 Hillel 11 Holmes. 119 Investment Company Institute 108 Iowa 91. xvi. 32 Intel 46 International Paper 6 internet 13. 46. 114 integrity xv. 75 ﬁfth down 101-102 ﬁring of U. 99 Israelites 124 J. 35. 53-54 ethical dilemma xiii. 43. 22. 31 ethics training 2. Peter 49 Duke lacrosse team 118 earmarks 98. 51. 63-66.S. Barney 93. 58. 99 gifts 60. 30. 27. 34. 92-93. 95. 41. 80-81. 26. 61. 17. 111. 86. 32. 53-54. 145 ethical intelligence xv. 22 Hais. 13. 11 132 . Al 42. 80. 27. 91. 103. 37. 68. 95 group-think 36 gymnastics 3.Cox. 60. omas 98. 69 Double Indemnity 30 Drucker. 96. 52 Gore. 3233. Andrew 61 deception 84. Paul 3-4. 17. 46. 20. 94 Franken. William 13 Federal Student Aid 69. 84. 117. 57.
xvi. 50 National Riﬂe Association 91 Netﬂix 113 Neuharth. 142 Kennedy. 117-121 Merrill Lynch 107 Microsoft 112-113 Milberg Weiss 114 Millennial Makeover: MySpace. Jim 47. 55 Korb. 113-115. William 109 media xvii. Jim 92-100 leadership xiii. 53. Arthur 108 leverage 110 Levy. 54. Bernard Cardinal 2 lawyers 2. 43. 60. 25. 54 Lombardi. Tom xiii. 85 Lie. 11. 96. 134. 3. 77 Los Angeles Police Department (LAPD) 67. 106 Los Angeles Angels of Anaheim 3 Los Angeles Juvenile Court xiii. Richard 118 Johnson & Johnson 34 justice 69. 76 moods 27. 77-78 late trading 107-109 Law. 118. 118 Los Angeles Times 64. 143-144 legislators-for-life 97 Lehman Brothers Holdings 107. 98. 68. 14 Muslim Public Aﬀairs Council 126 Muslims 119. Marv 106 Lewis. 41. lines 41. 99. Vince 80. 118 McCartney. Leora xiii. Warren K. 146 Los Angeles Uniﬁed School District 47 MacDonald.Jewell. 111 Little Red Book 123 Lockheed Martin Corporation 5-6. Jean 50. 129-130 Kennedy Space Center 51-52. George 36 Machiavelli 67 MacMurray. James 51-52 Kingston. Bernard 110 Mao Tse Tung 97. 70. 105. Bob 44 Knight. 93. 44. 124 133 . 36. 120 Leach. 35. 75. “Doc” 54 Libby. 67. 5. David 92 Logan. 69. 65 McDonald’s 134 McGuﬀey’s readers 123 McGuire. Fred 30 Madoﬀ. Alan 83 New Century Financial Corp 94 New Testament 10. Arte 3 Morgan Stanley 107 Moulton. 124-126 mutual funds 107-108. 69. Larry 53-54 Kozlowski. Donald 17 McCain. Immanuel xii. Scooter 83. Dennis 28-29 Krygier. John 61. 60. 37 Moreno. 78 Kanjorski. 96 Matuszak. Lord 10. Bill 102 McClintock. Eric 109 line. 76. 123 Marshall. 112 National Collegiate Athletic Association 102 National Education Association 60 National Performance Review 42. Bobby 105 knowledge workers 49. 67. 30-31. Tom 61 McConnell. 101. 69. 68 Loebsack. YouTube and the Future of American Politics 95 mission xvi. 43. Paul 94 Kant. 110-111 Levitt. Walt 101 McCabe. 141.
15. J. 112-114 Swift Boat Veterans for Truth 92 Talmud 11 Teapot Dome scandals 97 tennis 102.New York Times 118 Niebuhr. Andy 102-104 Rogers. 62. William 50 Rumsfeld. Reinhold 92. 106 Supreme Court 59. 91. 119 irty Years War 125 134 . 103. Alan 91 Sivits. Robert 4 Otellini. Willie 112 Sutton’s Law. 21-22. Will 107-109 ROTC 18 Ruckelshaus. Pat 125 Roddick. Curt 93-94. 45 Pulitzer Prize 118 Putnam Investments 107 quick quiz 5-6. 45. Bill 46 PAC money 93-99 Pappas. 93-100. 118 Oppenheimer. Barack 61. Martha 30. 130 poker 103-104 politicians xv. Scott 30 Super Bowl 3. 120. 74 e Purpose Driven Life 126 e State of the News Media 2008 118. William 10 Robertson. 114 Nortel 46 Northup. 64 Sutton. Paul 46 otherness 120. Michael 41-42 Owens. Anne 95-96 Notre Dame 104-105 O’Neill. 36-37. 95. Ken 21 Pentagon 43. 85 Old Testament 124 Olympic Games 3. 126 privacy 42. 44 Securities and Exchange Commission 108 self-diﬀerentiation 27. 127 Shakespeare 126 Simpson. 26 Schwarzkopf. 141 Republican National Committee 92 Rice. Norm 41-42. Dick 5 Roberts. 126 Ofﬁce of Management and Budget (OMB) 74. Al 98 smoking 94 Snavely. Eliot 49 Riley. 74 permission slip 5. Donald 86 Ryder 6 Sarbanes-Oxley Act 2. 125-127 Ovitz. Carl 101 space shuttle Columbia 51-52 sportsmanship 101-102 Stalin 97 State Department 74 steel mill 55 Stewart. 104 Texas Instruments 6 e Magniﬁcent Seven 9-10. Grantland 106 Richardson. Jeremy 53 Skilling. Potter 115 Strong Capital Management 107 subprime 94 Sullivan. 126 press freedom 117 Pringle. 68 reinventing government 42. 100 Nordstrom 113. Paul 45 O’Reilly. 25. Jeﬀrey 83 Smith. 83 Stewart. 120. 119. 6 PG&E 6 Plato 11. Bill 60 Obama. Jimmy 44 Parker.
143-144 unenforceable 10. 33-37 truth-telling 51. 95-96 Virgil 63 Visa 113 Visa card 75 Walt Disney World 41. 98 Trojan War 63 trust 5. Jack 47 West Bank 125 Wetzel. 14. 73. 27. 118 Weis. 83. 103. Paciﬁc Command 74 Ukleja Center for Ethical Leadership xiii.omas.S. 93. Eric 108 135 . 52 Tyco 28 Tylenol 34 U. 104-105 utilitarian theory of ethics 129-130 utilitarianism 129-130 utility 19. 114 Townsend and Townsend and Crew 113 transparency 28. 95 Zitzewitz. 30 Wyndham 6 YouTube 32. 18. Greg 68. 129 veterans 92. 31 UnitedHealth 109 United States Code 64 USA Today 83 USC Trojans 57-58. omas 86 Winograd. Harry 44-45 white lie 83-88 White. Charlie 105 Welch. Clarence 64 To Kill a Mockingbird 53 tobacco 94. 75 WorldCom 25. Morley 95 Woods. 69 Warren. 80 unenforceables 9-15. 141. xvi. Rick 126 Washington Post 69.
Long Beach. Confessions of a Civil Servant: Lessons in Changing America’s Government and Military. on leading change. the second largest university in the state. and navy. His recent book. and teaches business ethics at the University of Redlands.W. air force. an interview show in Southern California that proﬁles outstanding leaders. golf 137 Mick Ukleja is the founder and president of Leadershiptraq. He serves as a member of the guest faculty and on the Governing Council of the Ukleja Center for Ethical Leadership at California State University. He then spent six years at the White House leading the eﬀort to reinvent government. He helped found the Ukleja Center For Ethical Leadership at California State University. He hosts Leadershiptraq Televised.About the Authors Bob Stone served for twelve years as Deputy Assistant Secretary of Defense for Installations. and TRW. where he radically decentralized authority. chiefs of the army. Who Are You And What Do You Want? Four Questions at Will Change Your Life. He holds bachelor’s and master’s degrees in chemical engineering from MIT. has been praised by legendary coach John Wooden. Long Beach. . Harley Davidson. a leadership-consulting ﬁrm based in California. has been praised by senior aides to Presidents G. and occasionally got into hot water.” He is an internationally known author and speaker on ethical leadership. Anywhere. Tom Peters wrote the Foreword. cut regulations. Bush and Clinton. and on reinventing government. in which he calls the book “maybe the best text ever on large-scale organizational change. His ﬁrst book. and by the chairmen of Motorola. made excellence the new standard.H.
Ken Blanchard. because you’ll know who you are. and many prominent leaders and CEOs. you’ll come out a better person. in theology. 138 .A.champion Gary Player.” He has worked with entrepreneurs and corporate executives of businesses and organizations ranging from Boeing to the Special Olympics. in philosophy. what you’re doing.D. If you can answer the questions in a thoughtful way. author of e One Minute Manager. Mick also serves as Chairman of the Board of Trustees for the Astronauts Memorial Foundation at the Kennedy Space Center. He is a principal in Bonita Bay Group. and a Ph. and what’s going to guide your journey. “ is book is powerful. one of the largest developers of master-planned communities in Southwest Florida. Ukleja holds a B. writes in the Foreword. a master’s degree in Semitic languages. which oversees the Center for Space Education. Dr.
conducts seminars with local business and government leaders. part of the College of Business Administration at California State University.The Ukleja Center for Ethical Leadership at California State University. not just from university staﬀ. and they need to learn from community leaders. It does this through • Education – teaching students about ethical behavior • Research – engaging faculty members to conduct and publish research on ethical leadership. Long Beach—the second largest university in California with 32. To these ends the Center gives stipends for faculty members to create ethics content in their courses throughout the university. and • Community Outreach – oﬀering programs that emphasize the power of ethical leadership to organizations beyond the university’s boundaries Students need to learn ethics in all their studies. not just in ethics courses. Long Beach e Ukleja Center for Ethical Leadership. and hosts distinguished 139 .000 students—exists to equip people with the transformational power of ethical leadership.
sports teams. John Wooden.org or call (562) 985-8600. e award is presented annually to an individual or organization whose ethical behavior and visionary leadership have contributed signiﬁcantly to the community and who models a robust response to a speciﬁc ethical leadership challenge or opportunity.ucel.executives and public leaders for periods from a few weeks to three years to teach and to engage with students. Finally. businesses. faculty. e center has helped police departments. school districts. and non-proﬁts elevate ethical awareness and behavior in their organizations. please visit www. and community leaders. its services. For more information about the center. e Ukleja Center for Ethical Leadership welcomes individuals and organizations who are committed to promoting ethical leadership to participate as partners. the center created the John Wooden Ethics in Leadership Award. 140 . through a partnership with basketball coaching legend and bestselling author. and partnership opportunities.
2006 Business Week. John Wiley and Sons. Joni.” Foxnews. January 2002.” 22 July 2002. Strategic Finance Magazine.” American Way. 14 Joie A. p.com. Gregor.” Saj-Nicole A. March 2006. 20. pp. 2004. e Center For Academic Integrity. 2006. Business Week. “ e Most Aggressive CEO. 27 “Ex-WorldCom CFO Scott Sullivan Gets 5 Years. August 11. page 46 CFO journal. e Ethics of American Youth: 2004 “Americans Speak: Enron.Notes 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 e examples of the reciprocity ethic are all drawn from www. 83. “Geography Of Trust. 23 September 2002. www. “Ethical Dilemma. Robert Galford & Anne Drapeau 141 .org. 2005 e Josephson Institute.barna. March 2004 e Trusted Leader. “Focus on: e Chief Executive Oﬃcer” (Special Advertising Feature). Business Week 2001. Harvard Business Review. WorldCom and Others Are Result of Inadequate Moral Training by Families. 15 September 2002. p. 2005. 54. September 24. 27-28 World Magazine. 7. 7 September 2002. No. “A Crooked Path rough B-School?” Business Week online.org.” Just Enough: Tools For Creating Success In Your Work And Life. August 21. Vol. religioustolerance. Barna Research Online. 30 John Siegel.
March 2008 omas Jeﬀerson letter to Edward Carrington. 2000 Annual Report Interview with Mick Ukleja. p 492. Canto VI.opensecrets.htm. Stanza 17 Tompeters. quoted in Business Week. New York. 16 January 1787. Los Angeles Times. January 15. 2004 GE Corporation.businessweek.1 Sir Walter Scott. 2004 Ibid Philip K. November 25. Random House. 1987 142 . e Pew Foundation.htm?chan=search.com/magazine/content/07_03/ b4017075.com Jason Greene. Howard. 2007 Los Angeles Times. for credit default swaps.com/english/2007-11/12/ content_7054784. 2007 http://www. the website of the Center for Responsive Politics. 1995. 2003 Business Week. University of Chicago Press. Cited in e Founders’ Constitution. 2007 ese policies were known as CDS’s. 2003. August 31. Project for Excellence in Journalism.17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 Colin Powell. December 15. 2004 New York Times. Marmion.org.xinhuanet. 2003 http://news. e Lost Art of Drawing the Line. My American Journey. November 12. September 22. Georgia State University. Associate Professor of Finance. 070606 All data on campaign spending are from www. USA Today. ibid. September 4. Random House. p. December 31. New York.
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