Legalized Ethics

I have been doing my Minnesota Insurance Agents Continuing Education Ethics seminars around the state and have had some interesting discussions. One thing that was clear to me while doing the research to write the class as well as in receiving the evaluation forms - you can't legislate ethics. The Federal Government as well as the State and I am sure even at other levels have attempted to put laws into place that will force people to act in a certain manner. However, as Forest Gump's mother says, "Stupid is as stupid does." I believe that to be true with anyone. If someone is going to be unethical or has a tendency toward that behavior, I really don't believe the law is going to change that. People weigh the consequences and when they don't believe there are any or they aren't going to be enforced, they may give way to unethical action because it is the easier thing to do or everyone else is doing it.

Even though it is legal does not mean it is ethical. There are many laws on the books that enforce behavior that some people would consider immoral or unethical. In fact, in the trucking industry they have tried to regulate the amount of time a driver can spend driving. The purpose is to keep everyone safe on the roads including the drivers. However, because of construction, congestion, delays in loading/unloading, etc. many drivers feel they can't physically meet the time constraints the government has imposed on their position and still get the job done.  I have heard of this in the medical industry as well where the law puts restrictions on how much time a doctor can work. However, because of the amount of documentation and the fact that someone might come through the emergency room door before your shift ends and the time it takes to get lab results back, these doctors clock out but stay on the job. It is sad to know that people have had to find ways around the laws that really go against their morals, but they feel there is no other solution in order to meet the demands of all stakeholders.

Don't get me wrong - we need laws. However, I really don't think people need to solely rely on our legal system to protect people from themselves or others. We need to get some "common sense" and sense of pride in what we are doing and do things because it is the right thing to do.

The Cost of Ethics

Have you ever associated financial gain or loss with ethical decisions? An easy one is to look at the Gulf Coast and see what it is costing BP right now for not putting the safety features in place. However, there are many times that we may not see what our decisions cost us.

According to the Ethics Resource Center, when economical times are tough, ethic awareness is on the rise. People are afraid to lose their jobs. Companies are attempting to instill confidence in their products and services so the consumer will choose to put their dollars with the company. They have also found that when times are financially strong, the ethical indicator takes a nose dive. Companies make decisions for the dollar rather than the benefit of the customer. Employees see all the money flowing through and reach out to nab a little more for themselves.

There are many factors that are affected by ethical decisions. When ethics are lacking in a company they are found to have higher turn-over, more product returns, less satisfied customers, increased employee misconduct, and higher vendor costs. When the company's philosophy is to act in the best interest for stakeholders, others tend to come on board to that idea and the costs go down. Employee misconduct is lessened, products and services are of a higher quality, the customers are more likely to refer others, and the vendors/suppliers are more willing to negotiate pricing and services. There is a direct correlation between ethical behavior and cost. Unfortunately, it doesn't always manifest itself at the time of the ethical/unethical situation.

If you want to improve your bottom line, improve your ethics. Many organizations put emphasis on increasing sales and decreasing costs but forget that one of the best ways to do that is to improve your behavior. The way to do that is to establish a code of ethics:

• Determine what your company goal/mission/vision is
• Identify the stakeholders in your company
• Establish a code that aligns with your goals (can write it in terms of Do's or Don'ts)
• Determine what is considered a Wrongdoing (list examples)
• Appoint a compliance officer
• Check with legal counsel to approve it
• Have a meeting with the staff to help implement it
• Walk the talk

I think this quote sums it up quite nicely:

Nobody cares how much you know until they know how much you care. - Theodore Roosevelt

Start caring and prospering.