Assignment 1

Select an article on Business Ethics from HBR and summarize it in your own words.

Why Ethical People Make Unethical Choices

By Ron Carucci
Harvard Business Review
Originally posted December 16, 2016

I have selected an article of Ron Carucci which was published on 16th Dec, 2016 on “Why Ethical
People Make Unethical Choices” at their workplace. Ron has a thirty-year track record helping
executives tackle challenges of strategy, organization, and leadership.

SUMMARY OF ARTICLE

In most of the organizations ethical polices are made and reviewed over the period of time and
signed by employers/employees which they are bound to follow those practices at their
workplace to maintain the name, fame, standards and reputation of the organization.

However, it was revealed that many companies paid substantial fines by not following the ethical
policies which they should have. Hence, it specifies that how important these ethical polices for
the betterment of any organization, sustainability and economic growth. National Business Ethics
Survey suggests that leaders tend to make intensive efforts towards these practices to maintain
the pride of the company. In spite of that 41% of workers reported seeing unethical practices in
the last previous 12 months (from the date of survey) and some had to compromise on the
ethical standards due to the pressure pilled-up by organizations.

As per the article “Wells Fargo’s” paid USD 185 million in fines only because their employees
opened some fraudulent accounts. But having said that the choices of employees were mainly
depends on the systematic issue in which they were.

It has been noticed that despite good aims, organizations forced people to make choices which
they never wanted to opt but this is reality.

It was highlighted in this article that organizations unnecessarily put pressure on good people to
make unethical choices which are as follows:

It is psychologically unsafe to speak up

We have noticed that often employers say that we have a policy where everybody can work with
freedom, speak, show their leadership skills, suggestions for the good of organization but it
usually does not happen. In-order to establish a culture where people freely speak up is
extremely vital to ensure that people work in a healthy environment and avoid misconduct.

Elizabeth Morrison of New York University, in Encouraging a Speak Up Culture, says “You have to
confront the two fundamental challenges preventing employees from speaking up.  The first is the
natural feeling of futility — feeling like speaking up isn’t worth the effort or that on one wants to
hear it.

Furthermore, there is natural resistance to speak up and there is a perception that if we say
anything that might lead up to harsh or negative reactions and a manager reply to employee will
set the tone for future concerns / opinions and if a Manager reacts in a negative way which show
that he/she doesn’t want to listen concerns.

Too much pressure to achieve unlikely targets

Significant research from Harvard Business School suggests that uncontrollable goal setting can
encourage to make compromising choices in order to teach targets. Particularly, if those targets
look unlikely. Then people will cut corners to attain those goals and may cheat or lie while
reporting about their targets and objectives which they actually achieved. When people involve in
those tasks which are highly unachievable than they fear comes back in their minds for losing
their jobs.

Conflicting goals

Once a sense of injustice is provoked, the stage is set for compromise. Research on
organisational injustice shows a direct correlation between employees’ senses of fairness and
their conscious choices to disrupt their organisations.

A positive example is not being set 

We as leaders in our various capacities must accept that we are held to higher standards than
others. We/leaders must be careful not just about our/intentions, but how others might
misinterpret our behavior. Though every possible misinterpretation can’t be possibly
controlled, leaders who know their people will make careful choices in how they react to
stressful situations.