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The dollars and sense of workplace ethics

Recent findings by the Ethics Resource Center that employee misconduct has reached a historic low level prompts a look at why ethical behavior is so important for business.

By Gayle Kantro | gayle.kantro@am.jll.com | @JLLNews

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In this interview, JLL Global General Counsel Mark Ohringer discusses why ethical behavior is a business imperative.

Q: First, let’s level set. Have instances of workplace misconduct decreased?
A: We did see a decrease in investigated concerns in 2013 compared with 2012, so we agree with the findings of the Ethics Resource Center. With the increasing understanding that ethical behavior is expected and good for business, and bad behavior will not be tolerated, incidents of employee misconduct are decreasing.
Q: What is driving this decrease in misconduct?
A: In our case, there may be two factors. First, although we’ve had a pretty strong ethics compliance program in place for years, we have ramped up communication about it, which has increased awareness. Second, we think there is a cumulative effect of setting expectations.
We continue to be named as one of “the World’s Most Ethical Companies” by the Ethisphere Institute and our leadership continues to demonstrate ethical behavior every day. So the expectation that everyone is expected to behave ethically becomes part of the culture.
Q: How does having a strong ethics policy and enforcement program affect a company’s financial success?
A: Companies, especially public companies, are focused on making money and generating shareholder value. Clearly the most cost effective way to run a business is to not have bad things happen.
Ethical companies attract engaged employees who are happy to be at work and who can focus on doing their work—for their clients and for the company. It’s pretty likely that companies with bad ethical cultures will get caught. Then, instead of focusing on running the business, they need to spend their time and money on their defense and, perhaps, penalties.
Ethical companies attract engaged employees who are happy to be at work and who can focus on doing their work—for their clients and for the company. It’s pretty likely that companies with bad ethical cultures will get caught. Then, instead of focusing on running the business, they need to spend their time and money on their defense and, perhaps, penalties. Even companies with ethical cultures are distracted by bad behavior—by the need to investigate reported incidents and take appropriate actions.
Q: Do clients care about the ethics of the companies working for them—even if they get the job done?
A: The answer to this is an emphatic “Yes!” Clients don’t want to hire vendors who have bad reputations. It is becoming more and more common for companies to include questions about ethics and compliance in RFPs for major assignments.
It’s especially important for companies that provide professional services because the key factor in these relationships is trust. Clients want to know they can trust the companies who are representing them and advising them in areas like law, accounting, real estate.
Q: Why do companies care about being recognized for ethical behavior by organizations like Ethisphere Institute?
A: Recognition by third parties can carry as much, or even more, weight as self-reporting by companies. Being on lists of most ethical companies or best places to work can help win business and attract employees. But this recognition has an added benefit in the workplace. It can become a self-fulfilling prophecy by engendering pride in employees and reinforcing the expectation of ethical behavior.

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