How Ethical Are You and Your Business?

Last month I attended the Decorative Plumbing and Hardware Association meeting in Boca Raton, Florida. DPHA is a three-year-young organization that grew out of NKBA's DPH Council. It has 350 members who are dealers, manufacturers and reps.

One of the speakers at the conference was Frank Bucano. His talk, "How to Succeed When Others Bend the Rules," was about ethics both personal and professional. Bucano was not only a very entertaining speaker, he delivered a powerful message. He is truly an expert on the subject, having written two books about it and worked as a consultant and speaker. I thought the topic was important enough to share the essence of it with you.

Recently we have seen several giant corporations fall or be hit very hard by a lack of ethical behavior by their corporate officers. Enron, Tyco and WorldCom are a few names you'll recognize.

Thousands of people have been hurt by the thoughtless acts of these companies. Employees lost their jobs and pensions; investors lost millions of dollars; people have gone to jail; careers have been ruined; families have been destroyed all because a few people weren't honest.

We read every day about how corporate America is working hard to change how businesses are runin some cases closing the barn door now that the horse has gotten away. It's a case of being reactive to the ethics issue when they should have been proactive.

Positives and Negatives

There are both positive and negative ethics. Negative ethics tell us what not to do. They suggest that being ethical will prevent harm. Positive ethics, on the other hand, give guidelines for what we should do. Positive ethics promote good. This implies a responsibility to do well, and relies on the power of the organization to be responsive and have the ability to respond positively.

Our goal as individuals and business managers should be positive ethics.

Bucano suggests that the higher a person's self esteem, the higher the ethics will be. He shared the mission statement of the Ritz Carlton Hotel chain: "We are ladies and gentlemen serving ladies and gentlemen." Isn't that great! Everyone from the bellhop to the reception people, the chambermaid to the president all know and work to achieve this mission. What does it say for everyone's self esteem? Well, I know it would make me feel pretty good.

Unethical behavior has to be nipped in the bud or it will spread. If management is unethical and/or ignores it in others, it will spread.

If you, as the owner of a kitchen and bath firm, put some cash sales in your pocket and the bookkeeper or anyone else is aware of it, don't you think that person might start thinking "he does it, so why shouldn't I?" Perceptions determine attitudes and attitudes determine behavior. If the perception is that the boss is totally honest, the attitude will be "I better be honest, too" (which translates to the behavior).

Tom Morris, who wrote the book If Aristotle Ran General Motors, said, "Business is a partnership of people creating in many ways a better life for others as well as ourselves." The key word in this statement is partnership. We're all in this together owners, employees, vendors, clients and the families of all of those people. The implication is that both ethical and unethical behavior are contagious. It's catching!

Successful organizations do six things very well:

'' People do things "right" the first time on a routine basis.

'' Growth is profitable and steady.

'' Customer needs are anticipated.

'' Change is managed and planned.

'' People are proud to work there.

'' The business and employees have high ethical standards.

Bucano suggests that there are several myths that our culture teaches us:

'' Pain must be avoided at all costs.

'' Happiness "Go for it" and "If it feels good, do it!"

'' "Me-Oriented" Society money and materialism

'' Competition winning isn't the only thing it's everything!

With our society believing these things, is it any wonder so much unethical behavior takes place?

Taking a Stand

A long time ago my Dad gave me a long talk on honesty, virtue and integrity. He summarized the talk by saying, "When you die and someone is looking at your tombstone, it doesn't make any difference what the birth and death date are. The only thing that counts is the dash in between." Think about whether you'll be proud of your dash!

Along the same line, we should all stand on the shoulders of those who went before us. What kind of example are you setting for your employees, vendors, clients, family and friends?

We should all work out of a regard for others, a regard for our society and a regard for the whole human family. We are true heirs to the work of generations and a sharer in the building of the future of those who will come after us. This is a huge responsibility and we all share it.

When faced with making decisions as to being ethical vs. non-ethical, we have to consider four things:

1. The Act: What will the results of our decision be?

2. The Circumstances: What you know and don't know.

3. Criteria for Judgment: The law and what we were taught.

4. Communal Wisdom: Input we receive from others.

I'd like to close by leaving you with these ethical considerations:

'' On what foundation do you base your ethical decisions?

'' Do you make decisions on the values you hold dear?

'' Remember, ethical decisions are not based on how things do operate, but with how they should operate.

'' The most difficult decisions to make are those in which there is a conflict between two or more principles of which you deeply believe in.

'' It is important that you determine in advance what your priorities are, and then respond to those priorities.

Can an honest business prosper and thrive in today's world? You bet it can!

If you're a small business, you can create an ethics program for your business. It will serve you well to discuss it with your employees so that they have a clear understanding of what your vision is for your company. This discussion will help put the responsibility of ethical behavior on the individual as well as the company.

Our goal as owners, managers, employees and individuals should be total honesty, integrity, respect, caring and fairness, and to be absolutely ethical all of the time. No exceptions.