From an Oxford Ethicist: How to Test Ethical Decision-Making

Enron. Lehman Brothers. WorldCom. And your company?

You clearly want to avoid this list of major “too big to fail” firms that extinguished due to a lack of ethics. While many leaders view ethics as a vague extra that’s not critical to business, the death of these companies proves otherwise: ethics is critical to survival.

So how do you keep your organization off this list, and instill a strong sense of ethics into your company culture?

Our podcast guest, David Rodin, offers practical advice. A former Oxford ethicist, and current chair/founder of ethics consultancy Principia, Rodin says to start with distinguishing ethics from compliance and company culture. They’re very different things.

He uses three tools or tests to determine ethical choices:

1. The Good. Ethically good actions create benefits for people – the more, the better, in fact. Bad actions, on the other hand, create harm or risk for others. In other words, you gauge your plan or action based on the consequences it will have in terms of people’s happiness and welfare. If it will cause harm, your decision is unethical; it’s time to reconsider.

2. The Right. Does your plan or action fulfill a duty or obligation to someone? You’ll create an ethical quandary if it goes against an obligation. Contracts are a clear business example – violating them can be both a legal and ethical shortfall. But even handshake deals and promises reside in this category. “My word is my bond” speaks to your organization’s ethical character. Rodin points out a bigger picture overlaying here: fundamental rights, including human rights. These duties and obligations extend from the social or national culture in which your business operates.

3. The Fitting. This may well be the most difficult lens to see through: does your plan or action fit your firm’s character and espoused virtues? You’ll need to look inside yourself and the company’s leadership; often, company character and virtue are unspoken parts of the culture, rather than codified and written down. It might help to work backward – consider what vices and behaviors the staff is told to avoid, and what that indicates about the company’s ethics. Add yourself to this equation: what values and virtues do you want to bring with your leadership style?

None of this will be easy initially. Ethics is about using judgment across situations, so it’s a way of thinking through decisions you must make in those gray areas. Compliance feels easier in comparison; you’re following a set of rules, laws, or standards often defined by others. Check the box on the compliance list, and you’re done. Ethical gray areas, though, never cease to bubble up.

As you implement ethical training and codes, remember that they must be practiced company-wide, from top leadership to the front line. In almost every case of firms failing from unethical practices, it only took a few bad actors to bring down the entire organization. Ensuring everyone knows and follows your ethical guidelines improves your odds significantly.

And, perhaps, the best benefit of all: you’ll sleep better at night.

Did you ever find yourself in an ethical quandary at work? How did you resolve it? Let us know in the comments so others can benefit from your experience.

This article was adapted by Dan Mushalko from our podcast episode An Oxford Ethicist Reveals How to Strengthen Your Workplace’s Moral Compass.

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