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New Mexico Ethics Online, July/August 2010

Message from the Executive Director

 

Dear ethics allies:

Mark Your Calendars The Ethics Workshop TRANSPARENCY: Ready or Not November 18, 2010 8:00 a.m. - noon Hyatt Regency Albuquerque tickets go on sale in Summer 2010

In this issue of New Mexico Ethics Online, our main article, Board Leadership: Where the Ethos Begins, looks at the role of the Board of Directors.  It offers some tips on governing and emphasizes the importance of board leadership in forming the ethical character of an organization.

And speaking of Boards, our “Get To Know” interview features the new President of the New Mexico Ethics Alliance Board of Directors, Jackson Ellison.  Jackson takes the place of Ethics Alliance founding President, the truly honorable John Ackerman.  While no one can replace John and the phenomenal strides he has made to get this organization off and running, we are so grateful to have Jackson’s experience, knowledge, and great humor to lead us into our next phase of development.

Two othes joined the Ethics Alliance Board of Directors at the annual board meeting held in May: Joshua Parsons and Karen Rutledge.  Josh, the Business Manager of the Stockpile Reource Cetner at Sandia National Laboratories, has served on the Ethics Alliance Finance Committee for the past year.  Karen has been a very active and invaluable volunteer with the Ethics Alliance since beofre its incorporation in 2005.  She is the Ethics and Compliance Specialist at PNM Resources and one of a handful of Certified Compliance & Ethics Professionals (CCEP) in the state.

Want to make discussions about ethics and decision making an engaging and fun group activity for everyone in your organization? Check out the Resource Corner for a summary of Lockheed Martin’s The Ethics Challenge featuring Dilbert and Dogbert.   Though it was released more than a decade ago, this board game (that’s not just for the Board) is still relevant today and is a perennial favorite of HR professionals and ethics trainers around the globe.

And don’t forget to mark your calendar for the annual Ethics Workshop coming to Albuquerque on November 18.  You don’t want to miss this opportunity to earn some continuing education credits while learning from some of the top thought leaders in the field.  Stay tuned for more information about this ½ day training.

Hope you enjoy the rest of you summer and stay cool!

Truly,

Jill VonOsten, Executive Director

 

Get To Know…

interview with Jackson Ellison

Jackson Ellison is Vice President for Corporate Compliance and Chief Privacy Officer for Presbyterian Healthcare Services in Albuquerque, New Mexico. He holds a BS degree in Business Administration from the University of New Mexico.  As an ethics and compliance officer, Mr. Ellison has received significant specialized training, including: Certified in Healthcare Compliance (CHC), corporate ethics, medical products regulatory approval and compliance, healthcare joint ventures and regulatory compliance, Medicare Fraud and Abuse, IRS Coordinated Exam Program (CEP) audits, anti-trust and anti-kickback legislation, anti-patient dumping regulations, False Claims, and the Health Insurance Portability and Accountability Act.

Mr. Ellison participates in a number of community and professional pursuits, among them serving as a Quality New Mexico Examiner; member of the Internal Audit Committee of TriCore, a member of the Health Care Compliance Association (HCCA), and a life member of the New Mexico Military Institute Alumni Association.

He is one of the founding members of the New Mexico Ethics Alliance and has served on its Board of Directors since its inception.  In May, he was elected by his peers to serve as President of the Board.  In this interview, we asked him about his work at Presbyterian and his vision for the future of the Ethics Alliance.

New Mexico Ethics Online (NMEO): What do you see is the difference between Ethics and Compliance?

Jackson Ellison (JE): Regulatory compliance is really just about meeting the minimum standards for your business and industry. In my view, ethics is cultural and is about doing the right thing. To me, it’s a higher standard and is something I strive to help Presbyterian and its partners achieve everyday.     

NMEO:   What do you see are some of the biggest ethical concerns in healthcare today?

JE: If I had to choose just one thing I’d say the need to be transparent in everything we do, especially in regards to the quality of care we as an industry provide.  We have to be accountable for the care we provide and the cost of providing it. Another ethical issue is the potential for conflicts of interest between healthcare providers and the pharmaceutical, biotechnology and medical device industry. Too much or improper industry influence can result in conflicts of interest that may lead to increased cost, compromised patient safety, biased research results, an unethical culture and diminished confidence among patients, the general public and regulatory officials.

NMEO:  How and why did you get involved in the NM Ethics Alliance?

JE: I am fortunate to have been involved almost from the inception of the NM Ethics Alliance. I was asked by some people whom I respect a great deal if I thought there was need in the business community for help with organizational ethics. I said I thought the need was critical and that somebody ought to make this a priority. Now I’m part of that somebody!   

NMEO:  What is the benefit for an organization like Presbyterian in joining the Ethics Alliance?

JE: We’re a not-for-profit healthcare system and as such we’re accountable to the community to be good stewards of the resources that have been entrusted to us.  With approximately 8500 full time employees there is no way we do so without creating and sustaining an ethical culture. The NMEA is helping us on this journey.

NMEO:   As the new President of the Ethics Alliance, what is your vision for the future of the Ethics Alliance/or the future of ethics in the state of New Mexico?

JE: I believe New Mexico needs nothing less than an ethics “revolution” and that the NM Ethics Alliance can help jump start and sustain this undertaking. The key to this, in my opinion, is to focus on engaging many more of our community and business leaders and future leaders in this effort.  

Editor’s Note: The New Mexico Ethics Alliance invites you and your organization to get involved by joining, making a donation, or volunteering your time and talent.   For more information, call 505-277-0608.

 

In Perspective

Board Leadership: Where the Ethos Begins

In the search for organizational accountability, the Board of Director’s are under the microscope.  More and more questions about board composition, independence and processes are surfacing on S.E.C., I.R.S., and other official forms and forums.  It calls into question: What are the expectations and responsibilities of a board of directors?

While the specific responsibilities of boards and their members vary with the nature of the organization and applicable laws, a duty common to all boards of directors is that they govern and lead the organization.   Board governance - establishing the policies and strategies that help to fulfill the mission or purpose - is what boards do.    Acting honestly and in “good faith” while carrying out their duties is the expectation of how they do it.  

As leaders, part of the boards’ charge is to set the standard for ethical behavior in the organization.  Each member must take responsibility for their own behavior, of course.  Collectively, the board must create an atmosphere that guides the everyday conduct of the board itself, the people within the organization and the relationships among management, staff, and the community at large. 

The idea of “setting a tone” can be difficult from some boards to get their arms around.  The tips offered below can start a board on the right path.

Open Up to the Possibilities of Diversity

A first-rate board understands how their decisions on governance issues can lead the organization to perform more ethically.   Choices made regarding the boards’ composition are key in that respect.

In an effort to be professional and efficient in the discharge of their business, board members may inadvertently be tempted to minimize conflict in order to reach consensus and take swift action.  In other words, they may engage in a type of thought known as “groupthink” (Irving Janus, 1972).  As a result of groupthink, ideas may be acted on hastily without the proper analysis and evaluation which may be needed to make sound decisions. 

One example of groupthink is when member’s rubber stamp issues before the board.  That is, they may accept management decisions without adequate review and discussion.   A second instance of groupthink may ensue when board members engage in cronyism.  As they recruit others to join the board, members may tend to approach those they know through business and social scenarios and who share like experiences with them.  Thirdly, the board of directors may become set in their ways, for instance, an older, privileged group of leaders that holds fast to practices used throughout their careers, can unwittingly hinder the board’s ability to think “out of the box.” 

Tip: Diversifying the composition of the board can lead to more inclusive and potentially more ethical decisions and actions.  To ensure board members are equipped with the proper tools, processes, and motivation to carry out their responsibilities, board leaders may:

• Recommend candidates for the board of directors with diverse personal and professional backgrounds and experiences, and who reflect the demographics and interests of the community or those the organization serves.

• Empower the board of directors with members who have differing points of view.

• Encourage independent thinkers on the board and select a member to act as a contrarian.

  "Always ask the questions that nobody wants to ask." Outi Flynn, 2009

• Endorse inquisitive members who ask tough questions to clarify issues.

• Conduct board self-assessments to reflect on the board of director’s definition of and accountability to diversity.

• Enact term limits to make sure there is room for new perspectives. 

• Implement exit interviews to assess progress related to inclusiveness.

Such actions nudge board members into thinking more creatively, reflectively and inclusively.  As Outi Flynn writes in Meeting, and Exceeding Expectations: A Guide to Successful Nonprofit Board Meetings, “any exercise that forces the board to open up to accepting new ideas can turn an ordinary board into a vigorous and insightful group of team members.” Embracing the lively discourse and other benefits that come from diversity can build an even stronger bond among board members, one that helps them to understand their important role as the architects of the organizations’ ethos (or character).  

Embrace Discourse, But Avoid Conflicts

A reputable board of directors energizes the development of a healthy dynamic in the boardroom.  Board meetings are more likely to be civil when board members keep in mind commonly held protocols.  There is the obvious social decorum in the boardroom which includes arriving on time, coming prepared, and maintaining personal courtesy.

However, some considerations go beyond etiquette.  Failing to keep confidential information confidential, for example, and failing to recognize and report conflicts of interest may have consequences beyond the boardroom.  Questionable actions of board members individually and the board of directors jointly, undermine the integrity of the board and the organization as a whole.

Controversies may also arise if new board members misunderstand the guiding principles and obligations of organizational governance.  Unfortunately, sitting board members may not offer adequate assistance.  When responsibilities are not understood and roles are not clearly delineated, leadership conflicts may result and trigger a disconnect between the board of directors and the organization’s Chief Executive Officer(CEO), management, staff, or others.

Tip:  Clearly define board functions by creating “job descriptions” for officers and members of the board and developing committee charters to delineate tasks assigned to committees.  Be sure that the organizations mission or purpose is reflected in the description or charter.

Promote Open Communication

A board of directors with exceptional leadership acts as a conduit, not a dead end, for communication in the organization.  Not only is good communication essential for positive relationships among board members, it is also crucial between the board of directors, and the organization’s executive management, staff, and volunteers. 

Transparency allows communication to flow, not only from the board of directors to the CEO, staff, and other stakeholders; it also provides a channel for information to travel up an organization’s hierarchy.  A road block by the CEO, or a mere miscommunication however, may have a devastating effect on morale and performance.  It is short-sighted to think that all this negative energy will not extend to relations with other stakeholders outside the organization.

Tip: To check that communication is flowing, consider adding a Reports section to your board agenda which provides opportunity for staff/community to bring issues directly to the board, for updates on previous actions to be followed-up on, and prior board decisions to be reviewed and reflected upon.

Realize Accountability and Responsibility

The board of directors has overall responsibility for the ethical conduct within an organization and is charged with general oversight of an organization’s programs.  But rarely does its role extend to managing the operations of these programs.  Exceptions include the board’s duty to hire and evaluate the CEO’s performance, both internally and externally.   

Additionally, the board of directors is accountable for fiduciary oversight of the organization. Legal liability can be lethal to board members who fail to take their responsibilities seriously.  If an organization fails, board members may be held personally liable for such things as workers’ unpaid wages, severance, and termination compensation.

Tip: Make sure that the duties and responsibilities of staff and board are clearly delineated and that accountability for those duties and legal compliance is justly and appropriately assigned.  To that end, explicitly discuss the lines of accountability with the CEO, finance officer and other management staff.

Governing an organization is demanding.  The board of directors must work diligently to ensure an organization is true to its mission, well run, and sustainable.  Board members owe their organization careful attention to the formulation of its culture.   Placing high standards for how the board functions, what and how it communicates, and when and who it selects to lead are the type of governing decisions that set the right tone for an ethical culture to develop.

 

Resource Corner

The Ethics Challenge featuring Dilbert and Dogbert

Resource: Board game

By: Lockheed Martin

Synopsis From: boardgamegeek.com

This board game was developed in 1997 by the Lockheed Martin Ethics Awareness Training Development Task Force in cooperation with United Featured Syndicate. The game is a component of employee ethics training and uses a game board, character figures based on the Dilbert comic strip and a team guidebook.

Players are divided into 2 to 6 teams of 3 to 7 people and are led through a series of ethical case studies. A simple ethical situation is presented along with 4 possible responses.  The teams must decide which is the correct response and present it to the group.  Answers provide that team with movement points between 0 and 5 -- better answers grant more points. The teams then use their points to move their figure around the board and collect reward tokens. After 5 cases are answered, the game is over and the winner is the team with the most tokens.  The real objective is "to stimulate thought, discussion, and analysis of the issues that we all must deal with in our work."

Two of the 1998 versions of the board game are available for checkout in the New Mexico Ethics Alliance Resource Library.  Call 505-277-0608 to reserve.

 

Words of Wisdom

"Most discussions of decision making assume that only senior executives make decisions or that only senior executives' decisions matter. This is a dangerous mistake."

- Peter F. Drucker

Writer, Professor, Management Consultant

1909-2005

New Mexico Ethics Online, May/June 2010

Message from the Executive Director

 

Dear friends and allies:

 

In a recent survey conducted by the Ethics Alliance, we learned that many New Mexico organizations have questions and

concerns about conflicts of interest (COI).  Questions like: How do you prevent a COI?  What’s the best way to determine if a COI exists? What should be considered in a COI Policy?

 

Without a doubt, conflicts of interest lie at the center of many of today’s ethical scandals, and they are a legitimate concern.  Finding successful methods to handle conflicts of interest may help prevent you or your organization from suffering the damaging effects of these questionable associations. 

 

In this issue, we examine conflicts of interest in detail and provide some practical tips and tools to help you and your organization improve your skills and processes to effectively deal with them.   Our interview with Human Resource professional, Mary Cooley, provides some great insight and our Resource Corner gives you access to a sample conflict of interest disclosure questionnaire.

Take minute to answer our poll about your Conflict of Interest Policy.

We hope that these resources will assist you as you address conflicts of interest in your organization. If you have further questions or would like information on training on this or other topics, please do not hesitate to contact the office of the New Mexico Ethics Alliance at 505.277.0608.

 

Truly,

 

Jill VonOsten, Executive Director

 

 

Get To Know…

Interview with Mary Cooley

Mary T. Cooley, M.A., SPHR, is the Principal Consultant for HR Solutions, LLC.  A Human Resources (HR) professional with over 20 years of management experience in the United States and Europe, Cooley has twice been named by the New Mexico Business Weekly as one of New Mexico’s “40 under 40” who are making a positive difference in the state.  Other accolades include the YWCA’s “Woman on the Move” award and the National Society of Human Resources’, “HR Educator of the Year” and “Most Passionate HR Professional.”   Cooley has been an instructor with the University of New Mexico’s Anderson School of Business and Management Development Center for seven years. Currently, she is a doctoral candidate in Organizational Learning and Instructional Technologies at UNM.

 

Dealing with conflicts of interest often falls within the purview of HR professionals.  With her vast experience in management and human resources, we knew Mary was the right person to talk to about this subject. 

New Mexico Ethics Online (NMEO):  Why do you think so many organizations get into trouble because of conflicts of interest?

Mary Cooley (MC):  Conflicts of interest are inevitable. That’s the pivotal statement. Human nature leads people to seek comfort; to seek like-minded people with common interests, and so, conflicts of interest often arise.  To think otherwise is naïve.  Organizations in New Mexico, especially, should consider the possibility of conflicts of interest.  Most New Mexico businesses are small, employ few workers and often bring people they know and trust into their organizations, blurring the line between employer and employee, and allowing conflicts of interest to feed on themselves.  A business in New Mexico, as an example, employs fewer than 20 people, most of whom the business owner has known for years and trusts implicitly.  Not only could it be difficult for friends to question the owner’s decisions, but also, the owner could easily give friends special consideration and favors. It’s a difficult situation.

 

NMEO: What can organizations do to reduce the likelihood that a conflict of interest will occur?

MC: Although conflicts of interest are inevitable, they can be mitigated with good systems in place.  Organizations with a conflict of interest policy are better poised to avoid them.  Employers and managers should acknowledge the potential for conflicts of interest - call a spade a spade - and be proactive.  They should set a policy, which itemizes conflicts of interest and offers operational tools to deal with them. With a policy in place, employees should be confident the policy will be treated with honor.  Employees should know that if they come forward, employers and managers will deal with the situation without retribution.

 

Transparency is the key in moderating conflicts of interest. Employers should make it clear that when an employee comes forward, they can count on management to deal with it.

 

NMEO:  Who in an organization should be concerned about conflicts of interest?
MC: Everyone in an organization should be concerned about conflicts of interest. Employers and managers in the organization should create an atmosphere of trust where recognizing, understanding, and reporting conflicts of interest are more than policy - rather a way of life.  Everyone should use the “mirror test” and ask themselves if they are taking an upstanding role in the organization.

 

NMEO: You said “transparency is the key.”  Who in an organization should be asked/required to sign disclosures? (Board members, senior staff, employees, or volunteers?)

MC:  A disclosure statement emphasizes the importance of conflicts of interest to the company. As such, if the company requires a disclosure statement, everyone should be asked to sign it.

 

NMEO: Should an organization allow 3rd party anonymous reporting of conflicts of interest?
MC:  Providing employees with methods to report conflicts of interest is one tool to address conflicts of interest in an organization.  The organization should set up an outline for reporting.  Employees should know who to report to.  If they are not comfortable speaking with the first person in the hierarchy they would know who to report to instead.  The organization might have an 800 number employees could call to report conflicts of interest or make an ombudsman available for reporting.  Anonymous reporting swings both ways.  The possibility of misuse exists, but creating trust and transparency within the organization diminishes abuse of the conflict of interest policy.

 

NMEO:  How should an organization investigate/handle reports of conflicts of interest?
MC:  The methods for investigating and handling conflicts of interest reveal who management is. Although organizations have a conflict of interest policy in place, it is imperative the policy is implemented.  Employees’ reports of conflicts of interest should be taken seriously.  Conflicts of interest disrupt the equilibrium of input and output in an organization, and when employees feel they are treated unfairly, turnover rates increase and productivity declines.

 

NMEO:  Who determines whether a conflict of interest exists in an organization?

MC:  There is no hard and fast rule for deciding who verifies conflicts of interest.  Certainly, the person should be someone without a vested interest in the outcome of the situation and a person skilled in investigation. Human Resources professionals and outside experts could be solicited.

 

 

In Perspective

Managing Conflicts of Interest

 

What constitutes a conflict of interest?  Determining when one exists may not be as simple as it appears.  A conflict of interest policy can provide guidance; however, applying the policy to your particular situation is where you might lose your way.  To steer clear of these sticky situations, you should know what defines conflicts of interest, how to recognize and prevent them, and how to stop them once in motion.

Defining Conflicts of Interest

A conflict of interest occurs when your impartiality is undermined by a contest between your self interest and your professional interest. Whenever you receive or have the potential to receive a personal benefit, the alarm should sound.  Because even if an actual conflict of interest has not occurred, suspicions may arise that you have received benefits improperly.  Whether real or perceived, a conflict of interest can destroy your credibility, ruin your reputation and diminish your bottom line. 

Many situations, whether intentional or accidental, can compromise your personal integrity.

There are several situations or patterns of behavior to watch for, including:

• Self dealing. Taking advantage of your official capacity in a transaction to act for your own interests rather than for the interests of your client/customer/constituent.  There are many types of self-dealing, but one example might be: You serve on a non-profit board and the board authorizes the organization to lease a building that you own.
• Nepotism. Granting favor to relatives regardless of merit. For example, you purchase goods and services from a firm owned by your spouse.
• Cronyism. Granting favor to friends regardless of their qualifications. For example, you are hiring a new assistant and use your position to hire a friend who is clearly not the most qualified candidate. The line between cronyism and “networking” can be hard to delineate. But the costs can be reduced business opportunity, limited competition, inflated prices, and decreased performance, to name a few.
• Gifts and favors. Receiving gifts and favors that might influence your professional judgment or conduct. Gifts may include tangible items, or such things as a loan, a gratuity, a reward, a promise of employment or any other thing of monetary value.
• Patronage. Using your powerful position to gain access to relationships that can provide you with benefits. An example of political patronage would be when a party in power rewards individuals, families, or groups for their electoral support using illegal gifts, state resources or fraudulently-awarded appointments or government contracts. 

 

Recognizing Conflicts of Interest

The examples listed above may appear to be cut and dried; however, it is difficult to be objective in situations where you are personally involved. You may work in a smaller organization or live in a small town, where the likelihood of becoming involved in a conflict of interest can be even greater because business is often done with family and friends.  When personal and professional lives intermingle, it is especially important to clearly define the boundaries between personal and professional goals.

Along those lines, conflicting goals often result in conflicts of interest. That is to say, personal goals may take precedence over or be in conflict with organizational goals. In order to recognize an impending conflict before it happens, you should know how your personal efforts fit into the organization’s goals. As you express your personal goals, look to see how they mesh with your organizational goals. Consider the point where they intersect and determine if a potential conflict is or could be present. 

 

Preventing Conflicts of Interest

Like with most things, prevention is the best medicine for managing conflicts of interest.

The best prescription for avoiding conflicts of interest includes taking the following actions:

• Monitor your own behavior. When starting a business relationship with family or friends, ask yourself if a conflict exists. If the answer is no, ask someone else.
• Set a standard. Before you create or revise a conflict of interest policy, create a list of potential or past conflicts of interest specific to your workplace and industry.  Consider relationships and organizations that pose potential risks.  Think about the patterns of behavior that can develop with these relationships. What are the power structures of those relationships?  Is there a potential for an abuse of that power?  Once you are aware of the different types of conflicts of interest, look for solid and professionally relevant examples.  Use these examples to train those in your organization to be aware of and understand conflicts of interest and also to apply them to their own circumstances. This due diligence can help you create a standard policy and training program that best addresses your organization’s needs.
• Identify potential conflicts. Consider creating a disclosure statement, which lists potential sources of conflicts of interest. A disclosure statement enables individuals to identify their outside interests and possible biases.  Disclosure forms have limitations, however, because businesses and relationships change.  Revisit the disclosure statement regularly to identify other possible conflicts of interest. An example of a disclosure questionnaire is available in our resource corner. 
• Seek Counsel. Surround yourself with people who have the courage to speak truth.  If you are unsure that something is a conflict of interest, run it by an objective third party.  Speaking to a trusted confidant who is not involved in the matter cannot hurt and their perspective may alert you to the perceptions of others who have a vested interest. You may also consider speaking with professionals: the Compliance Department in your organization, the Human Resources Department, an ethics advisory panel set up by your organization, or contact an attorney. If you speak to an attorney, make sure they are familiar with your industry.

What to do in a conflict of interest

Although prevention is the best medicine, a conflict of interest is often only recognized when it already exists or in retrospect.  If you are involved in a conflict of interest, and would like to correct the situation, several options are available.  Optimally, remove yourself from the situation as soon as possible. If you feel that you have a legitimate reason to remain in the situation or professional relationship, request written consent from your employer to continue. Disclose every fact and detail. Your supervisor may offer a solution. For example, you may be assigned an alternative position in the organization. If you are a CEO, a supervisor, a board member or other decision maker, recuse yourself (abstain) from voting or remove yourself from making the decision where such a conflict exists.  Do not assume a matter is inconsequential and can be ignored.  Small conflicts of interest can snowball into a situation that can potentially ruin your career.    

The conflict of interest concept is vague mostly because how we perceive these relationships is often subjective.  Still, it is not impossible to navigate through the fog. The key is not to try to avoid all possible conflict of interest situations, but instead to be able to recognize and have a process for handling them effectively.  Because how you manage them and whether you assure open and honest deliberation affects all aspects of operations.   It is critical to making good decisions, complying with the law, avoiding ethical scandals, keeping the focus on your organization’s mission, and most importantly, building trust with your stakeholders.

Resources Corner

 

Sample: Conflicts of Interest Disclosure Questionnaire

By: The New Mexico Ethics Alliance

 

Many organizations have Conflict of Interest Policies and require some or all of their Board members or employees to read and sign the Policy.  Included in most policies is a “Duty to Disclose,” which makes it incumbent upon the person signing the policy to divulge associations that may present a bias or conflict.   With self disclosure comes a subjectivity which may blind the individual from recognizing an existing or potential conflict.  While the individual’s intention may be to fully disclosed, they may not have the time to deliberate or the foresight to consider all the possible conflicts that can occur.

A carefully worded COI Policy will include definitions of terms so that the individual can fully understand which of their own associations could pose a problem.  Also helpful, is a disclosure questionnaire that will enable the individual to reflect on their current and past associations. 

 

The New Mexico Ethics Alliance has created a Sample Conflicts of Interest Disclosure Questionnaire.  While this sample may not be appropriate for all sectors and industries, it does include questions that are designed to prompt the individual to read and understand the company COI policy and to consider various types of associations that impede their judgment or that might give the appearances of a conflict to others.

 

Words of Wisdom

 

"A great man is one who can have power and not abuse it."

Henry Doherty

U.S. businessman, 1870-1939

 

New Mexico Ethics Online, March/April 2010

 

Message from the Executive Director

Greetings:

 

It has been said that “technology is king.”  At times, it seems like it rules our life. 

 

In this issue, we discuss electronic communications and social networking.  Both have become hot topics in ethics and compliance circles. They are popular topics not just because these technologies permeate every facet of our lives, but also because their use can have so many ethical implications.  Our privacy, productivity, perception, and reputation (and that of our organization) can be at stake with a single click, comment or post. 

Read this issue and tell us about social networking in your organization. 

Take the Social Networking Poll

When you answer the poll, you’ll get the results of others who took part.

 

And while you are sharing your thoughts, please participate in our short survey to help us plan this year's Signature Event.  The event offers a unique professional development and networking opportunity for those committed to a practice of ethical conduct and fostering a culture of ethics in our state.  With your help, we can create a relevant and worthwhile experience. 

Take the Event Survey

As always, we love to hear from you.

Truly,

Jill VonOsten, Executive Director

 

Get To Know

…how New Mexico organizations handle the use of social networking on the job

 

Networking…social?  business?  These days it is hard to distinguish between the two. 

Whether Facebook, Twitter, or LinkedIn, people are connecting for all sorts of personal and professional reasons.   Facebook alone reports more than 400 million users with more than 35 million updating their status every day.  How much of this activity occurs at work?

More and more organizations are using social networking for business purposes to help hire the right people, market products, and reach customers among other things.   The Ethics Resource Center reports that “social networking can be beneficial to organizations if managed correctly, but a true productivity killer if abused by employees.” 

According to the 2007 National Business Ethics Survey, 16 percent of employees report observing abuse of the internet by other employees at work. Some organizations have felt the need to create policies dealing specifically with social networking sites, as the following national survey results indicate:

Does your company have policies specifically addressing employee use of Facebook, Twitter LinkedIn and other social networking sites?

  

 

                            

A national survey of ethics and compliance professionals conducted by the Health Care Compliance Association and Society of Corporate Compliance and Ethics, August 2009.

Is social networking a problem for New Mexico workplaces or is it a helpful tool of the trade?    Does our increasing urge to “stay connected” at all times interfere with work? Is there a need to draw a line between professional and personal use on the job?  

We were curious.   So we asked a few New Mexico workplaces if they have a specific company policy addressing employee use of social networking sites.  The organizations we spoke to vary in type of business, workforce size and in the way they provide guidance for their employees on this issue.  Here is what we found:

 

Workplace #1:  A multi-state private property management company

This company maintains a “Computer Usage Policy” and while it does not specifically address “social networking,” it does have sections entitled “Basic Computer Use Guidelines,” “Internet Use Guidelines” and “Email Usage.”  There are several areas of note in the policy. 

• In the Internet section, the policy clearly prohibits non work-related use by stating: “Do not visit websites that are not work-related, visit chat rooms, use instant messaging services, or play computer games on your company computer.”
• In addition to prohibited use, this section also gives an example of allowable Internet use: “Logging into, and editing information in your payroll provider's website is considered work-related and is allowed.”
• The policy also alerts employees that their use is monitored, with this statement:  “Although it may seem private, you are not anonymous when you use the Internet. The email you send and web pages you visit can be easily recorded and monitored by [the Company], law agencies, and other parties.”
• The company asks employees to sign the policy and verify their compliance: “By signing below, you agree to follow the listed guidelines unless expressly instructed to follow a different procedure by the [Company] IT department.”

 

Workplace #2:  A publicly traded energy company

Company representatives offered the following:

"Our company has several business technology policies along with associated procedures and manuals which set security standards for company-related information.  While we do not have a specific policy related to the use of social networking sites at this time, and such sites are not blocked on our system, our personal conduct policy does state that personal use of Company computers and Internet access must be kept to a minimum. It further states that inappropriate and/or excessive non-work-related use of Company equipment and systems is prohibited and that policy violations may result in disciplinary action, up to and including termination of employment.  Addition of a social networking policy will be considered with our next security policy update."

 

Workplace #3: The libraries department of a public university

A department leader wrote:

 

"The [University] does have a general policy for all employees regarding their online activity while at work, however, we have recently offered additional guidance to all employees staffing public service desks (circulation, reference and our virtual service desks), to limit their use of all communication tools including phones, email, etc. to insure the employee's attentiveness to our customers. These guidelines apply to all employees - full time regular employees and student employees."

The “additional guidance” includes the following statement regarding social networking: 

"Social networking applications like Facebook, LinkedIn, and MySpace are becoming very common communication tools. Individuals, companies, and organizations are all exploring the use and benefits of these services. The [Department] is venturing into these spaces with a Facebook page and blogs. These “tools” offer library staff a great way to communicate with customers and colleagues.

 

The [Department] encourages all employees (staff, faculty and students) to also explore this kind of engagement with social media, but, as with the telephone and email, library employees should limit personal use of these sites during work hours to incidental use as provided for in the [University] Acceptable Computer Use Policy  (Ref. Policy number and section)."

Take our poll and let us know about social networking in your workplace.

 

In Perspective

Techno –Trouble: E-mail and Ethics

E-mail, we use it at work and at home.  What is the difference?   Many of us communicate informally through e-mail and use the internet at work for more than assigned tasks.  The line between personal and business use of technology can be blurry.  By using technology casually and sometimes carelessly at work, we put ourselves and our organizations at risk.           

Technology Pitfalls                                                                                                              

A laidback approach to technology use in the work place can lead to legal and ethical problems, with e-mail generating some of the most obvious traps.  E-mail is fast, easy, convenient and efficient, but those same benefits may create problems at work.  E-mail is so fast that many times messages may not be as well thought out as traditional forms of communication.  It is much easier to click “send” than it is to address an envelope. But an accidental click of “reply all,” can inadvertently send a private message to the entire company. E-mails are convenient, but can be easily misinterpreted. Although they are conversational, they lack the context – the body language and expression - of face to face communication. Unlike verbal communications or messages on hard copy, e-mail can be easily forwarded, posted to a blog, and so on.       

                         

Beyond what would be considered proper etiquette, e-mail communications can also pose ethical risks.  Questionable content or mishandling of e-mails can result in an embarrassment or worse, a lawsuit against you or your company.  Ethical violations such as: breaching privacy, copyright infringement, harassment, slandering, etc. are not always intentional, but they do happen.

History confirms that the threat is real. In 1995, when e-mail was relatively new to the workplace, female employees of Chevron used personal e-mail as evidence to sue the company for sexual harassment. The personal e-mail that circulated between 25 men was titled, “25 reasons why beer is better than women.”  The women claimed that Chevron, “created, or failed to prevent, a hostile working environment for women.”  Chevron paid $2.2 million to the female employees to settle the case.

Lawsuits involving workplace e-mails are not just a thing of the past.  Today, e-mails and other electronic documents are often used as evidence in lawsuits.  Ari Shapiro from National Public Radio (NPR), reports that, “90 percent of the cost of a lawsuit today can come from sorting through e-mails and other electronic documents to determine which ones are relevant to the case.” Lawsuits are not the only cause for concern. According to a 2007 American Management Association (AMA) Survey, 30 percent of employers who monitor e-mail have fired employees for e-mail misuse.

Monitoring computer use in the workplace

Due to these ethical, financial and legal concerns, employers are increasingly monitoring e-mails and other computer use. Organizations may face harsh consequences if employees misuse the Internet. The AMA’s Electronic and Surveillance Survey (2007) reports that 66 percent of employers monitor internet activity. The AMA also states that 45 percent of employers track content, keystrokes, and time spent by employees at the keyboard.  Computer monitoring may happen without notification, but the AMA reports that 83 percent of organizations do notify their employees that monitoring of content, keystrokes and time spent at the keyboard takes place.

Right to Privacy vs. Right to Monitor

Is monitoring employees computer use legal?  Although monitoring is legal in most cases and is commonplace, many are concerned about their right to privacy. The U.S. Constitution protects your right to privacy, but not against your employers during working hours or while using workplace equipment. Employees have no right to the expectation of privacy when they are using a computer or server belonging to their employer, even if it is used to access their own ISPs to check their personal e-mail.

The Electronic Communications Privacy Act of 1986 provides some privacy protections. With respect to e-mail, these protections are not available to employees when

• Employers provide e-mail service through a company-owned system
• When employees consent to monitoring.

For the majority of cases, current law favors employer monitoring.

What you and your organization can do

Although technology use involves risks, there are precautions you can take to minimize your exposure:

• Treat business e-mails like formal hard copy correspondence.  Read the message a few times to check your tone before you hit “send.” You want to sound approachable, friendly, and well-mannered.
• Do not use all caps. Your reader may interpret this as yelling.
• As quick and convenient as it is to abbreviate, avoid misinterpretation by not using slang or abbreviations in professional e-mail correspondence.
• Keep your business and personal e-mail accounts separate.  Even if your workplace allows personal online shopping during your break, do not use your work e-mail address to shop for personal items.
• Consider using a formal e-mail address for business communications. Cutesy or racy e-mail addresses may annoy or offend prospective employers and other professionals.  For example, avoid butterflykizzes@yahoo.com, instead, use your first initial and last name or something similar.
• Notify others before you send attachments. Many people are wary of opening attachments because they fear contracting a computer virus. This is especially true if they are unfamiliar with the sender’s address. If you send an attachment, identify yourself and describe the nature of the attachment in the message.
• Maintain a policy on computer use in the workplace. Your policy might include these components:
• Limit Internet and e-mail use. An all out ban on personal use might do more harm than good if the message comes across as “we don’t trust you.”   Consider the tone of the policy and give examples that identify appropriate use as well as inappropriate use.
• Prohibit offensive, harassing and threatening communications.
• Prohibit communications that violate privacy or copyright laws.
• Block access to external blogs and certain Internet sites (for example, pornography, shopping, gambling, and networking sites).
• Monitor computer use. You can use both software and manual review. There are e-mail monitoring software packages that flag risky e-mails. Those that are flagged can then be manually reviewed for compliance with the company policy.   
• Address the e-mail policy in your organization’s code of conduct.
• Make e-mail etiquette and your computer use policy a component of employee training sessions.  Include a signature line and date to assure that the employee has read and understands the policy.
• Hold people accountable for inappropriate use.  Discipline those who violate the policy.

Organizations can help guide their employees in appropriate computer use by setting standards through policies, educating employees through training, and putting in place the accountability measures to assure compliance.  These practices will reduce the risk of ethical violations caused by technology use in the workplace. 

E-mail is often the most convenient way to communicate in the workplace, and is frequently the first contact you have with someone in the business world.  We all know that first impressions are important: they can make or break business relationships.  Professional and courteous e-mail communications can help to build positive business relationships by encouraging others to trust and respect you and your organization.  

 

Resource Corner

2009 National Business Ethics Survey®

By: The Ethics Resource Center (ERC)

Publisher: The Ethics Resource Center (ERC)

ISBN 978-0-916152-16-1

 

The 2009 National Business Ethics Survey® is the sixth in a series of reports that began in 1994. 

It is part of an ongoing research initiative of the Ethics Resource Center (ERC) based in Arlington, Virginia.  This year’s survey focuses on the extraordinary economic events of the past two years and their impact on ethics in the American workplace.  It also tracks the trends in ethical conduct and culture.

 

Founded in 1922, the ERC is America’s oldest nonprofit organization devoted to the advance­ment of high ethical standards and practices in public and private institutions. For more information about this study or to download the survey visit www.ethics.org  

 

Words of Wisdom

“Words, like eyeglasses, blur everything that they do not make more clear.”

– Joseph Joubert (French essayist and moralist, 1754-1824) 

 

New Mexico Ethics Online, January/February 2010

 

Message from the Executive Director

Dear Allies:

 

A new decade is upon us and its a time of great anticipation!   Whether you are recovering from last year or the recent holidays, you're looking forward to a year of new challenges or, like me, you are reveling in the college bowl games, basketball season, or NFL playoffs, this issue has something for all of us to think about. 

Before opening the door to 2010, I'd like to look back at 2009 and give you a brief report of the Stephen M.R. Covey, SPEED of Trust Workshop, held on November 19.  This was the New Mexico Ethics Alliance first Signature Event and by all accounts, it was a great success!  Almost 500 people showed up for the half day workshop held at the Hyatt Regency.  Program evaluations filled out by participants ranked both Mr. Covey's speaking abilities and the entire event experience extraordinarily high (9.2 out of 10 scale).  Many people attended with their work colleagues, business suppliers and customers and found it to be a great team and trust building experience.

Look to the Ethics Alliance in 2010 for more opportunities to network, train and build trust in our workplaces and communities. 

- Jill VonOsten, Executive Director

 

Get To Know

 

...guest columnist Randy Van Vleck

 

With recent headlines covering sports and ethics, we wondered about the ethical lessons learned through sport.    In this issue, guest columnist Randy Van Vleck offers his thoughts on the subject based on his years as a collegiate athlete and more recently, as a youth soccer coach.  Randy serves as the General Counsel to the NM Municipal League and on the NM Ethics Alliance Board of Directors.

Ethics and Sports: It Takes A Team

These days athletics and ethics don’t always run hand-in-hand. One of the long time selling points of athletics in schools and universities is that athletic programmes foster good sportsmanship and in turn good citizenship. Recent reports of misconduct in sports, both professional and amateur might make one wonder if this basic premise holds any truth.

 

First, make no mistake about it, athletic programmes in universities are businesses. These programmes are expected to be successful and are expected to generate revenue. According to the 2003-2004 U.S. Department of Education's Equity in Athletics report, the University of Texas spent $70.6 million on athletics with $12.9 million allocated to its football programme. At the University of Nebraska, the numbers were $55.8M and $12.9M respectively. The Capstone Report notes that the athletic budget for the University of Alabama in 2007-2008 was a staggering $93 million.

 

With money like this being invested by boosters and business people, it is no wonder that coaches and athletes are pressured to perform. Boosters and contributors want performance results and they want them fast. Fans expect nothing short of regular winning seasons and invitations to post-season tournaments. Coaches are being fired after only a year or two if they don’t deliver successful programmes.  From the individual athlete’s point of view, the days of the full-ride four year scholarship are over. Athletes, who were once offered four-year scholarships to compete in their particular sport, are being offered one-year renewable scholarships that are contingent on the athlete’s success on the field, track or pitch.

 

Thirty years ago, I had the privilege of being awarded a four-year, full ride scholarship to run track at Loyola University of Chicago. My four years running at Loyola were stressful, but that stress was mostly self inflicted. I wanted to be the very best always, as did my coaches, my family and my teammates. I had good meets and not so good meets, but there was never the threat that my scholarship was in jeopardy because of a less than successful outing.

 

Coaches have a difficult job. On the one hand they are employed to train athletes to excel in their particular sport. But developing excellence in the athletic arena is only part of the job. Coaching should also be about instilling principles of sportsmanship and fair competition.

 

The average person’s involvement in sports is occurring at a much earlier age today than it did when I was a child in the 60’s.  Back then, about the only organized youth sporting activity was Little League Baseball.®  Little League Baseball® began at age 8 and ran through age 12, with some leagues providing programmes for older children. Today, Little League Baseball® sponsors

T-ball and minor league programmes for children beginning at age 5. Soccer, softball, gymnastic and football programmes also have sprung up across the country, with kids having their first taste of competitive sports starting at age 5. Coaches are becoming a stronger influence on American youth than at any other time in our history. Some of these coaches and parents foster an environment filled with praise for winners and “lip service” respect for less than successful teams and individuals. But it doesn’t have to be that way.

 

Within the Loyola track programme, the coaching staff was always professional, caring and interested in the well-being of the student-athletes that were under their charge. I became injured mid-way through my junior year and was under the almost constant care of the team physician and personal physicians. While I was encouraged to continue to practice and compete, I was never once asked to compromise my health in the name of the track programme. I pushed through a great deal of pain because of my love of running and dedication to the programme and my teammates, not as a result of threats or compulsion.

 

Former University of New Mexico goalkeeper for the women’s soccer team, Shannon Adragna, noted that “when you play sports you're under the microscope and people often judge you based on your actions on the field and not you as a person.  This is a huge responsibility for an athlete to live up to and can be unfair.  We all make mistakes and shouldn't be judged solely on one action.” Likewise, the fans, supporters and spectators need to assume some responsibility. It should never be about winning at all costs, but about the spirit of competition and the development of athletic skills and good sportsmanship. 

This reminds me of post on the Ethics Scoreboard about a girls basketball team that played a game to a score of 100-0. Egged on by the fans, the coach allowed his team to run up the score while continuing to play his best players, all in an effort to reach the 100 point benchmark. (Or was it to humiliate the opposition.) What kind of a message does this send to players on both ends of the court? No one involved in this competition had the fair-mindedness to do the right thing. The “winning” coach could have taken measures or instructed his players on how to hold the score down and still win the contest. The “winning” players could just as easily have taken such matters into their own hands. The fans of the “winning” team could have been content with a victory instead of clamoring for a slaughter. The “losing” coach, players and fans could have suggested to the opposition or to the referee that the contest be declared at an end. But no one acted nobly, and the girls of the “losing” side suffered a horrendous humiliation at a tender young age. This is not what sports is or should be all about.

 

How do we reconcile competition and good performance with sportsmanship and ethical behavior?  Well, sometimes it means doing the right thing even if it results in losing the game or match. In a recent seminar, Steven M.R. Covey held up tennis player Andy Roddick example of fair play and an example of “Doing the Right Thing.”   In the 2005 Rome Masters, Roddick asked the Chair Umpire to reverse a line judge’s call on a serve that had proven to be match point for Roddick.  His opponent was awarded the point, and then went on to win the match from Roddick. Roddick’s act of fairness cost him the match and a substantial amount of money.

 

Organizations, like individuals also have the opportunity to “Do the Right Thing” and it is heartwarming to witness such actions. I have done so on a first-hand basis; Loyola University was the benefactor. I finally had to give up my track career during my senior year; the extent of my injuries was such that I could no longer compete at the Division I level. To Loyola’s credit, they continued to pay my scholarship benefits, despite the fact that I did not run a step my senior year. The school would have been justified in eliminating or re-allocating my scholarship, yet they chose to continue the benefits to me. I am eternally thankful for the high ethical standards exemplified by this athletic programme, and I think the way the university handled this situation contributed significantly to shaping my ethical and moral fiber. I will always hold a special place for the athletic department at Loyola University of Chicago.

In Perspective

Stress Free in 2010

New year—new hopes? A New Year can bring about both excitement and anticipation, but holiday exhaustion coupled with an uncertain employment or economic outlook can have the adverse effect, leaving us anxious and dreading the new year.

Let’s face it, many of us have legitimate reasons to be concerned and outright stressed about our financial futures.  Maybe you are unemployed or fear an upcoming round of lay-offs?  Maybe you worry about personal finances or are weary from working overtime to compensate for staff cutbacks?  Maybe you fear for your organization’s future and the inevitable and difficult decisions that you may face in the New Year if things do not improve?

Tough and uncertain times like these can challenge the resolve of even the strongest and most optimistic employees.  Cutting corners and engaging in misconduct can be tempting options, as more people struggle to make ends meet and more businesses fight to keep their doors open.

Take fraud for instance. According to famed criminologist Donald Cressey, there are three reasons why people commit fraud: opportunity, rationalization, and pressure.

 

Pressure/ Incentive: In these times, when funds are short and employment prospects are slim, you may feel more pressure to cheat, deceive or steal to make ends meet. Your boss or organization may place incentives that encourage you to produce more without regard to how you do it.

Opportunity: You might commit fraud because you have access to all the necessary tools. For example, a cashier might rip off the cash drawer because s/he has access. You may be in a position of authority where no one questions your actions. Recent cutbacks may have reduced the number of checks and balances that were in place to deter the risk of fraud. For example, someone who is not trained in finances might be doing the accountant’s job and may commit fraud now that they have access to the books.

Rationalization: You might feel that your company is treating you unfairly; therefore, you rationalize that fraud is your only answer. As an organization, you might rationalize that you must cut corners in order to stay in business.

So how can you cope with all this stress without becoming the next scandalous headline?  How do we put the worries of the last decade behind us and resolve to live better, behave better and prosper more in 2010?

Clarify Your Values

One major component to stress management and preventing misconduct is clarifying your values. This applies to both the individual level and the organizational level. Dr. Robert S. Eliot and Dennis L. Brio offer stress management tips in their book, Is it Worth Dying

For.

• “Visualize the future.” Think about obtainable goals.  It is okay to go above and beyond, but do not forget to be practical.  You can set the standard bar to an infinite height, but you cannot reach that far.  To excel and avoid pitfalls set the standard bar at a level that requires effort to reach on your part, but make sure the reach is possible.
• “Concentrate on key areas.” Abraham Lincoln said, “... you can’t please all of the people all of the time.”  Focus on your main priorities and know your limitations.
• "Be Consistent."   This is one thing everyone can do to make his/her behavior less problematic. “People don’t know how to relate to someone who is inconsistent.”  Being consistent is critical to stress management in the workplace.  The more consistent your behavior, the more likely people will be willing to trust you.
• “Take time to plan.” “Set aside one week a year to assess where you’ve been, where you’d like to go, and how you are going to get there.”

Manage Stress on an Organizational Level

Helpguide.org offers the following tips for managers to help them make the work environment less stressful for themselves and their employees:

• “Improve Communication.”  Be clear about what you expect from your employees. Provide pertinent information to reduce their fears for the future.
• “Consult your employees.”   Discuss deadlines and workloads with employees to prevent yourself from pushing unrealistic expectations onto them.
• “Offer Rewards and Incentives.”  Rewards and incentives help people to feel valued and appreciated.  But you must carefully consider offer the right kind of incentives.  Award people on achievement gained by ethical performance, not just achievement that yields profit.  Incentivizing only the outcome can inadvertantly promote fraud and other misconduct.
• “Cultivate a friendly and social climate.”  “Make management actions consistent with organizational values.”  For instance, make sure your company policy has zero tolerance for harassment to prevent anyone from feeling unsafe in the work environment.  Also, provide opportunities for everyone in your organization to interact.

Manage Stress on an Individual Level

You can tackle your own personal stress to reduce the amount of strain that you might experience in the work environment.  The Mayo Clinic provided the following tips:

• “Identify the source of the problem.”  No matter what is creating problems for you at work you need to find out what is going on and take necessary steps to resolve it.
• “Develop friendships at and outside the office.” First, minimize interactions with negative people or people who say, “who cares if the glass is half full or half empty, it’s going to spill anyway.”  Discussing work issues with people you trust can help you release stress.
• “Choose battles wisely.”  You do not have to engage in verbal wars with everyone who tries to start one. Stay calm and only argue if you need to.
• “Have an outlet.” Find an enjoyable activity that gets your mind off work related stress and problems.

Now that 2010 is here we can begin to work on recovery, build a positive mindset, and create a healthy workplace.  One way to achieve these goals is by transforming the negatives of the fraud triangle into positives.  You can provide incentives and opportunities for ethical performance and give people rational reasons to consider how they get tasks done.  The tips above can help you and your company to begin the New Year stress free.

Resource Corner

 

Winning's Only Part of the Game, Lessons of Life & Football

By: Bobby, Terry and the Bowden Family

Publisher: New York : Warner Books

ISBN: 446520500

Synopsis From: Publisher

 

 

The Bowdens are the first family of college football. Bobby, the father built the winningist program of the decade at Florida State.  Son Terry took over an Auburn team on probation and led it back into the top tier of the sport.  Here for the first time, in a family dialogue created especially for these pages, the Bowdens talk frankly about the passions and pressures of their lives: balancing work and family, coping with defeat, managing success adapting to change.

Winning's Only Part of the Game offers lessons of a lifetime and inspiration for battles in arenas far beyond the football field.  There is no simple playbook for success, say the Bowdens.  But there is a a right way to play the game, to persevere through heartbreak, to overcome self-doubt, to grasp and hold a sustaining faith, and to ultimately achieve a sense of accomplishment made all the more precious by the struggle.

Words of Wisdom

“Nothing good comes in life or athletics unless a lot of hard work has preceded the effort.  Only temporary success is achieved by taking short cuts.  Set a goal and go after that goal with integrity, self-confidence and a lot of hard work.” 

- Roger Staubach

Alumnus, NM Military Institute and U.S. Naval Academy
Heisman Trophy winner, MVP in Super Bowl VI, and Hall of Fame Quarterback for the Dallas Cowboys 1969-79

 

 

New Mexico Ethics Online, November/December 2009

Message from the Executive Director

 

Dear Allies:

It's not too late to sign up of the Stephen M.R. Covey,SPEED of Trust Workshop on Nov. 19th, but time and seats are running out!  

The Ethics Alliance is pleased to bring Covey to New Mexico and judging by the response of hundreds who have already registered for this event - we are not alone!   

We believe that trust is the foundation for fostering ethical cultures.  That's why we have dedicated this issue to the topic and offer tips to help build trust and credibility.  And while Covey's message is "red hot relevant," it is the promise of building a community of trust across the state that's really exciting and an idea whose time has come to New Mexico.         

- Jill VonOsten, Executive Director

 

In Perspective

Believe It or Not: Transparency Can Improve Credibility

Transparency is one of the latest buzzwords.  You hear it everywhere:  "__________ must be more transparent.”  Substitute the blank with just about anything - Government, Business, Management, Wall Street, The Board, Communication, The Process, etc. etc.   The call for transparency is clear and present everywhere you look.  But what does it mean?

 

When we think of the word transparency, chances are we think of something that is easy to see through with nothing to obstruct or obscure our view.  Think of a glass house with the sun shining through, where you can see all of its contents and every action clearly.  There is CLARITY - no hidden corner, no man behind the curtain, no …   But wait, the house is locked.  So how do we know if what we see is real and not an illusion?

 

Clearly, there is more to transparency than meets the eye. 

 

Think of your last phone call to computer tech support, for instance.  Perhaps the person on the other end of the phone was a nice, well-trained individual who obviously knew what they were talking about.  But from your end, the “support” you received was anything but clear and understandable.  Maybe the information sounded alien, full of jargon and complicated steps that left you feeling frustrated.  At the end of the call, the solution to your technical problem was neither clear nor within your grasp.

 

Or perhaps you received a statement for a recent health screening and you could not make heads or tails of the charges.  Someone had apparently been thorough and taken the time to account for each and every procedure, itemizing and coding to track each expense.  But what do those codes mean?  Why is it that some costs appeared to have been billed to your insurance provider while others are marked “you may be responsible?”   After reviewing the bill, it isn’t obvious how much you owe or even who you should call to find the answer.  The provider?  The doctor who ordered the tests?   The billing agency?  The insurance company?

 

When we say we want something or someone to be “more transparent”, we’re saying we want there to be no hidden agendas, no hidden costs, no hidden risks, and no hidden actions.  We want CLARITY and ACCESSIBILITY.  We want the information presented to be easily approachable, easily reached, easily delivered and easily understood.

 

Increasing Access in Various Organizations

Access to information is a critical part of transparency. Open meetings and freedom of information legislation are examples of measures that have been taken to unlock access to information.   Public, private, and non-profit organizations alike are beginning to make more and more information available on their websites and in public reports to signal their willingness to be open, to build public trust and to help prevent fraud and other forms of corruption.

 

  Government

USAspending.gov was created as a result of The Federal Funding Accountability and Transparency Act of 2006.  The Act requires the full disclosure to the public of all entities or organizations receiving federal funds beginning in fiscal year 2007 and the “single searchable website, accessible by the public for free” allows you to track where your tax dollars are going.   Sunlightfoundation.com lists several websites that you can visit to become more informed about government decision making and spending.

 

In New Mexico, state and local governments are considering implementing new transparency practices like the proposed Sunshine Portal, described as a “searchable, user-friendly, public website that discloses how our state government receives and spends funds in a simple and straight forward manner.”  A hotline is also planned to provide assistance to people without internet access. The idea is to keep legislation open for discussion and to prevent government employees from using their position for their own interest.

  Private Sector

Ben McClure, a regular contributor to Investopedia.com, states that investors want companies to publish both “more and better” financial reports. While companies with clear and easy to understand financial reports are thought of as more trustworthy, companies with complex financial records are often suspected of hiding information. McClure maintains that “transparency makes analysis easier and thus lowers the investor’s risk when investing in stocks.”

 

  Non-Profit Organizations

Guidestar.org encourages non-profit organizations to share their information openly and completely. Their site allows visitors to look at tax forms from non-profit organizations (the IRS 990).  . Want to know how much of the organization’s funding went to administrative overhead? Where their funding came from? What type of programming they offered? Guidestar.org provides the venue for non-profits to break it down.  For donors looking for an organization worthy of their charitable contributions, this type of disclosure and openness can make all the difference in deciding where their hard earned money goes.

 

Transparency and Your Credibility

With so many reported incidents of misconduct in government, business, and non-profit organizations, it is no wonder that people are looking to transparency to help prevent corruption, hold people accountable and build credibility.

 

You may be tempted to keep information close to the vest because you fear its release may hurt you – “that everything you say, can and will be held against you.”  More often, the opposite is true. - whatever you appear to be hiding or not disclosing is usually what is held against you.    At best, people assume you have a hidden agenda and at worst, they think you are lying or behaving in a corrupt manner. Both can lead to a loss of respect and reputation. 

 

Can you be credible without being transparent about everything?  Sure, there are some times and good reasons why you may not or should not be completely transparent.  For obvious reasons, Coca-cola shouldn’t release its secret recipe and organizations must protect the privacy of their employees and customers. 

 

But know that if something is obscure or complex, others are likely to perceive it as being intentionally misleading, shady or suspect.  If your words and the reasons behind your actions are not clear, if people do not understand you, they may distrust you regardless of your intentions.

 

If you are clear and direct and follow the mantra: “When in doubt, let it out” - you can build your credibility.  When people understand the reasons behind your actions, they are less likely to assume the worst.

  

What can you do?

Barbara Pagano and Elizabeth Pagano, the authors of The Transparency Edge: How Crediblity can Make or Break you in Business, offer you tips on how to practice transparency in your organization.

• Be Overwhelmingly Honest. When leaders do not disclose all the pertinent information, it is often because they do not have all the facts. The best thing to do would be to admit you do not have all the facts. This will likely prevent others from suspecting that you have a hidden agenda.
• Handle Mistakes Properly. It is beneficial for you to admit to mistakes even though you may fear appearing incompetent, weak, and several other things. Admitting to mistakes demonstrates accountability.
• Keep Promises. Sometimes you may be forced to reconsider a promise or completely break it. Silence will not solve this problem. It is better to explain your reasoning, so that others can understand why you could not deliver your promise.

Transparency and How to Tell the Truth

While practicing transparency can help build your credibility, you need to be aware of how you tell the truth.   The Paganos provide examples of what not to do when you are trying to be transparent and tell the truth.

• Avoid being too politically correct and too careful in your wording.  This can make you come off as evasive and indirect. Neither of which help your credibility.
• Do not be too blunt. Being direct is important, but so is consideration for others. You can appear to be thoughtless or tactless if you are too direct.
• Avoid Ambiguous Answers. When answering questions avoid saying things like “Well the answer is both yes and no,” and “it’s a little of this and a little of that.” These “non-answers” can make you look like you are hiding information.

 

By being transparent, you (and your organization) signal that you are proud of the way you conduct business and interact with others. By sharing information openly with others, both inside and outside your organization, you encourage truthfulness and trustworthiness.  By making information clear and accessible, you invite verification and you demonstrate you have nothing to hide.  When you do all that, it’s credible!

 

Get To Know

interview with New Mexicans on "Trust"

The topic for our interview this month is, what else: TRUST.   It seems that if there is one lesson that can be gleaned from our collective experience of the last year, it is that trust plays a crucial role in the strength and resiliency of our economy, among other things.   If that’s true for the big picture, we were curious to see what role trust plays in the lives of workers here in New Mexico. 

So, we asked New Mexicans in all type of occupations - from the military to the massage therapist – what part TRUST plays in their day-to-day work life.  Their answers were thoughtful and insightful.  And while their answers differed, it’s clear that TRUST is an important and valued principle in the work and lives of each of these individuals.   Read what they have to say and consider: What part does TRUST play in your work?   

 

"Trust is a major factor in my business because I need to rely on the Salon owner to provide a professional and inviting environment in which to do my work.  My clients need to trust that I will be there when they need me and that I will consistently offer the quality of service they have come to expect from me (as well as fun and gossip!)"

Michael Semones, Hair Stylist

Salon Artel

 

 

“Trusting myself, and my gut instincts, is most important. Trusting the best in others, brings out the best in others.  Trusting the best in me, brings out the best in me.  When I trust people to discover yoga for themselves,

I notice it increases their ability to trust inthemselves.”

Suzanne Hruschka,  Self-employed

Licensed Massage Therapist and Hatha Yoga Instructor

 

 

 

 

"Trust is essential in my job.  As a teacher, I put a lot of trust in my students.  I trust them to study on their own and to do their own work.  Students have to trust me to teach them the correct material and to teach it in a way that they can understand it - sometimes a difficult task!"

 

Debby Casson, Math Instructor 

University of New Mexico--Albuquerque Main Campus.

 

 

“Trust means doing what you say you will do in the time you said you would do it.  I believe from our team's perspective, trust meansseveral things: 1)  Contractual Trust--are expectations of one another being met?; do we work with one another's best interests in mindor are there self-serving interests driving behaviors?: and when agreements aren't met do we renegotiate or simply fail to follow through?  2) Communication Trust--do we communicate openly and honestly with one another or with caution and when we have issues with one another; do we talk directly with each other or talk behind each others backs and feed the rumor mill?  3) Competence Trust--are we able to rely on one another's competence to do their jobs?

David L. Palmer, Director 

Ethics & Business Conduct Center 

Sandia National Laboratories 

 

 

"Trust means a lot of different things to me and not just at work.  I trust in God, my family, my country, and in my fellowman.  Trust cannot be bought or sold, it can only be earned through defining experiences and time with those you work and live with.  As a member of the military, I perform tasks that can be extremely dangerous, and without trust among co-workers, it could result in serious injury but most likely death.  So ultimately, I believe trust is the ability to do the right things for the right reasons. It is also the ability to know how others will react in different situations.”

Daniel Bergmann, Senior Airman

United States Air Force

 

 

“There are real costs to any organization, group or team that does not have trust.  With trust, communications, follow-up, accountability, risk-taking and innovation all tend to happen.  Without trust, each tends to break down or not happen at all.  In low trust organizations, there are hidden costs throughout--costs such as poor communication, failure to accomplish tasks and extra time to complete or redo tasks.  To correct for the poor organizational performance caused by poor trust there are often costly-micromanagement tools applied that further run up the costs while further reducing trust.”

Bill Hartman, President 

High Tech Company 

 

 

 

“Trust is a relationship of reliance. It is also one of faith.  My profession, Certified Public Accountant, is one that is based on trust.  Our clients come to us because they trust that we will have the knowledge and competence to provide them with quality and professional services.  They also trust that their personal information will remain confidential.  We also trust our clients to provide us with accurate and truthful information.  We trust that we can believe in them.” 

Margi H. Palmer, CPA
Palmer & Co., PA

 

 

 Resource Corner

The SPEED of Trust: The One Thing That Changes Everything

By: Stephen M.R. Covey

Publisher: Simon and Schuster

ISBN: 1-4165-4900-5

Synopsis From: Publisher’s Weekly

 

 

Trust is so integral to our relationships that we often take it for granted, yet in an era marked by business scandals and a desire for accountability this book by leadership expert Covey is a welcome guide to nurturing trust in our professional and personal lives.

 

Drawing on anecdotes and business cases from his years as CEO of the Covey Leadership Center (which was worth $160 million when he orchestrated its 1997 merger with Franklin Quest to form Franklin Covey), the author reminds us that there's plenty of room for improvement on this virtue. Following a foreword by father Stephen R. Covey (author of The 7 Habits of Highly Effective People and related books), the junior Covey outlines 13 behaviors of trust-inspiring leaders, such as demonstrating respect, creating transparency, righting wrongs, delivering results and practicing accountability.

NMEA notes: For those planning to attend the workshop on November 19th, a copy of the book, The SPEED of Trust, comes with the registration price.  Sign up now...

 

Words of Wisdom

 

"Organizations are no longer built on force, but on trust."

Peter Drucker

Management Expert, Author and Teacher

(1909 - 2005)

New Mexico Ethics Online, September/October 2009

Message from the Executive Director

Dear Allies:

We have a new look to our newsletter!  We hope that it will make it easier for you to find your way around the many offerings of the New Mexico Ethics Alliance as well as the events and resources found on our website. We'd love to hear your feedback about the newsletter and/or any suggestions you have for improvement.  Write us at feedback@nmethics.org.

Have you been struggling to find affordable, high quality training opportunities?

Then join us on November 19th when internationally acclaimed author, Stephen M.R. Covey will present a timely workshop based on his New York Times best selling book, The SPEED of Trust.   You do not want to miss this chance to hear Mr. Covey speak to a New Mexico audience. It offers a great opportunity for professional development and team building. Register by October 15, 2009 to take advantage of our low cost, early bird ticket prices. Register and find out more.

Hope to see you all there.

- Jill VonOsten, Executive Director

Get To Know...

interview with Dr. Diane-Michele Prindeville

Diane-Michele Prindeville is the Director of the Masters of Public Administration and the New Mexico Certified Public Manager (CPM) programs at New Mexico State University (NMSU).  She earned a Ph.D. in political science from the University of New Mexico and a Masters in Public Administration from Arizona State University.  She has held positions at all levels of government. 

 

Dr. Prindeville has spent the past year developing the NM CPM program at NMSU for national accreditation.  In 2009, the first CPM courses were offered to County employees and elected officials through a collaboration with the New Mexico Association of Counties. The program is currently being expanded to serve municipal employees.

 

New Mexico Ethics Online (NMEO):  What is the primary goal of the CPM program?

Dr. Diane Michele Prindeville (DMP): “Our motto is “Better Government through Education.” Our goal is to provide the best possible professional development and educational opportunities for public sector employees and officials, at an affordable price, when and where they need it. We do this by working with curriculum advisory committees comprised of practitioners, academics, and private sector professionals to design programs that meet the particular needs of the communities we serve.”

 

NMEO:  Who should enroll in the CPM program?

DMP:  Managers and supervisors, and elected and appointed officials, at all levels of government.

 

NMEO:  Why do you feel this program is important to New Mexico’s public managers?

DMP:  The CPM is a nationally accredited comprehensive management program designed for professionals in federal, state and local government.  Its purpose is to improve the performance of administrators and public officials, and the effectiveness of their organizations.

 

NMEO:  Ethics scandals seem to plague New Mexico government at all levels.  Why is that?

DMP:  Professional development and training of personnel have not been highly valued by our public organizations in the past. Governments function on tight budgets and are reluctant to spend money on what they may deem “frivolous” expenditures.  However, recent high profile state and national scandals have demonstrated the need for investing in education and ethics programs for both our public officials and employees in government.  Ethics education and training increase awareness and competency in dealing with complex issues while making for better public service and greater accountability.

 

NMEO:  What is the impact of these scandals on the public?

DMP:  The impact is considerable and damaging to our democracy.  It’s evident in the public’s lack of trust in our institutions of government, in their lack of respect for our public officials and public employees, and in their cynicism towards democratic processes such as elections and public policy making.

 

NMEO:  What can be done to lower the level of ethical misconduct in government?

DMP:  The NM CPM stresses the value of ethical behavior, best practices, and professionalism while working to impart an ethic of public service and respect for democratic processes in program participants.  Ethical values and problem solving skills and behaviors are integrated into the curriculum.  Because our students are encouraged to develop close working relationships during the program, and they learn with and from each other, they serve as sounding boards and peer mentors. When seeking solutions to ethical dilemmas, they have knowledge to draw from as well each other and their shared experiences. In other words, the way to decrease unethical behavior is to teach, continually advocate, and model ethical values and behavior in public service.

 

NMEA:  Are the ethical issues faced by managers in the public sector different than those faced by managers in the private sector?

DMP:  It’s not so much that the ethical issues are different but that their potential impact on society is significant. Public sector managers and officials deal with issues of the public trust, with public monies, with public property, with civil rights. Their decisions affect our health, safety, democracy, and liberty.  Public officials and employees regularly face constituencies with conflicting demands and “no-win” situations where the outcome may be an unsatisfactory compromise.  Furthermore, they operate in a fishbowl while being expected to meet the highest standards of personal conduct, yet they face potential conflicts of interest – especially in small communities.  It’s a tough job.

 

In Perspective

Values in Action

 

Honesty, teamwork, accountability – aren’t these values we can all agree on?   Then why can’t we all seem to demonstrate them in the workplace?

 

Everyone brings his/her own personal values to an organization. The challenge is determining what the organization as a whole values, sharing those values with each other, and then using them to guide all of our actions.   How do we put what we value as an organization in action to reach our collective goals?

 

Communicating Values: Why is it important?

 

For some, it begins with the mission statement.  Many organizations use mission statements to describe their core values.   Writing your values in a mission statement is one thing, but living your values is another thing.
 

In researching their book Say it and Live it, authors Patricia Jones and Larry Kahaner found many companies with good mission statements but who were unwilling to be included in their book.  If their mission statements were so good why wouldn’t they want to be recognized for it?  Jones and Kahaner explain: “The last thing management wanted was for their employees to see them quoted in a book about how the company lives up to these ideals, while everyone at the company knows differently.”  Your mission statement is simply all words if your organization’s behavior does not line up with your stated core values.

The Challenge: Practicing What We Value

Stating our values is one thing, but we often lose our way in daily practice.  One of the biggest challenges is that individuals have a hard time seeing the impact of their actions or how they can be a catalyst for change - good or bad.  To put values in action, individuals in the organization first need to understand how their behavior affects the whole. 

Communication through formal training and other avenues is the key to answering such questions as: 1) Does this apply to me? 2) How will this help me personally? 3) How will this help the organization?  and 4) If I agree with these values or ethical principles, what does it look like in my every day job?  Once these questions are answered you can move to the next step - ACTION.

3M is one such example.  They communicated their core values of “sponsoring innovation, protecting the creative individual and solving problems in a way that makes people’s lives better” and then provided employees the means to act on those values.  To spur their values into action, 3M allows scientists to spend up to 15% of their time working on whatever scientific pursuit they like.

Companies Who Have Faced The Challenge
 

Company success often involves just that - matching what you say with what you do.  Sister Helen Prejean, the woman whose real life was the subject of the movie Dead Man Walking, looks at it from another angle, she says:  “I keep watching what I DO, to see what I BELIEVE.”   This practice of examination and reflection has enlightened many organizations who have struggled to live up to their ideals.

The auditing and accounting firm KPMG believes in learning from experience. One of their practices is to use actual incidents reports to inform future ethical decision making. Timothy Flynn, KPMG's Chief Executive Officer, describes how the company handles incident reports, "We put the incidents into categories, give examples, and describe the actions we took as a firm to deal with them." This helps employees understand KPMG values and helps KPMG communicate expectations for acceptable behvior and model accountability.

 

In the aftermath of its 2002 ethics scandal, Tyco, the multi-national group of manufacturing and services providing companies, restructured how its behaviors line up with its values.  Eric Pillmore, former Senior Vice President of Tyco and the man behind much of the reorganization states, “Whatever is emphasized, measured, and rewarded—that’s what people do, and that’s what they keep getting better at doing.”  Now employees are evaluated on integrity, excellence, teamwork, and accountability. These evaluations help Tyco’s values and actions stay in alignment.

The Kellogg Corporation is a business that strives to demonstrate the value of integrity through practice. The Kellogg Philosophy book is a company resource that helps them carry out what they value. "This little book is the glue that holds the company together," says Arnold Langbo, retired Chairman and CEO of Kellogg. The book features a picture of a lone corn flake standing on end with the caption, "A reputation is a fragile thing." Langbo carries a pocket sized version of the Philosphy book with him at all times. It serves as a reminder of the Kellogg values.

Reinforcing Values on A Daily Basis
 

Deloitte & Touche USA was name by Fortune magazine as one of the 100 best companies to work for in 2008.  The CEO of this accounting and consulting firm, Barry Salzberg, says that values are part of what he calls “organizational gravity - a force needed to guide people’s actions, keeping them grounded and focused on what really matters.” To maintain organzaitional gravity, says Salzberg, an organization needs to have "ethical leadership matched by fair, human and genuinely ethical culture - one that is constantly reinforced, day in and day out - is the key to seeing them in action.

Organizational values can be more than just beliefs, aspirations or statements. Communicating them, connecting with them and reinforcing them in practice – day in and day out - is the key to seeing them in action.

 

Resource Corner

Ethics Resources for the Government Sector

By: New Mexico Ethics Alliance © 2009

Synopsis From: New Mexico Ethics Alliance

Many government scandals in recent years have undermined the public’s faith in government   In fact, a recent survey of U.S. households showed that 81% of those polled had lost confidence in the federal government. The resources offered on our Member’s site  discuss what government officials and public servants can do to restore and maintain trust between the government and the people. Our collection includes resources on a variety of topics, such as: traps that should never trap you, conflicts of interests and what to do when a conflict arises, and laws about government transparency.

After you have finished viewing these resources you will be more aware of how to avoid common mistakes, and the need for clarity and public access in government processes. Gaining awareness can be your first step in strengthening public confidence in government decision making and improving the ethical climate within your organization.

Have a great policy or best practice you want to share with fellow New Mexicans?   We invite you to send in your resources or state your resource needs at feedback@nmethics.org.

 

Words of Wisdom

“Values provide perspective in the best of times and the worst.”

-Dr. Charles Garfield, author

The Peak Performance Trilogy

New Mexico Ethics Online, July/August 2009

 

Message from the Executive Director

Dear Allies:

What makes Bernie Madoff tick?  Why have so many companies, even reputable ones, been caught in the middle of ethics scandals?  Are our economic woes tied to our lack of ethical will?  These are the questions that inspired this issue of New Mexico Ethics Online.

When we think of fraud we might envision sensational swindles, scams or someone selling snake oil.  We might think the perpetrator would be a shady character, disgruntled and lost inside some large corporation.  Otherwise they would surely be noticed.   But the truth is, fraud can happen at just about any workplace and by anyone, even and especially by those we think we can trust.  In our interview this month, UNM Professor, Dr. Rich Brody shares some insightful findings about fraud. 

In word association - when I say “stimulus,” you say?…“response?”  A stimulus, by definition encourages, motivates or provokes a reaction…a response. There is a lot of talk these days about what it will take to stimulate our economy.  Experts say that our economy has stalled due to a lack of confidence – by consumers, by lenders, by borrowers, etc.  If confidence is the missing element, then what will stimulate confidence?  In Perspective takes a look at some of the behavior trends that contributed to this recession and considers what we could do differently to build confidence in each other and our economy.

If you are a member of the alliance, you need to take advantage of the tool we highlight in this month’s Resource Corner.   Our Inventory of Ethics Practices is a great place for organizations to renew their commitment to ethics.  By reviewing your own workplace practices, you’ll be able to assess your readiness to prevent and mitigate misconduct and better yet, foster ethical conduct.  This tool is free to organizational members of the Alliance and can be purchased for just $49 by non-members.

As always, if you would like to learn more about the tools, resources and allies of the New Mexico Ethics Alliance, just give us a call at 505.277.0608.

                                                                                                                                                           - Jill VonOsten, Executive Director

Get To Know...

 interview with Dr. Richard Brody

 

Dr. Richard Brody is a Professor at the University of New Mexico, Anderson School of Management.  He teaches auditing, fraud and forensic accounting courses.  He is also the co-director of the Center for Information Assurance Research and Education at the Anderson School and has worked diligently to establish a Federal Bureau of Investigation Forensic Computer Lab at UNM, which opens in 2009.  He is a Certified Public Accountant, a Certified Fraud Examiner, and a Forensic Certified Public Accountant.  On May 12, 2009 at the 20th Annual Hall of Fame Dinner, the Anderson School of Management honored Dr. Brody with the Faculty Community Leadership Award.

 

In addition to teaching, Dr. Brody donates countless hours to the district attorney’s office and is sought after by the media as an expert commentator.  He spends a lot of time speaking to individuals and organizations about fraud prevention and detection in order to make them aware of the likelihood of fraud occurring and to offer advice on how to prevent them from becoming victims.  If you would like to have Dr. Brody speak to your organization, he can be reached at brody@mgt.unm.edu.

  

NMEO:  What is fraud?

RB: There are many different definitions but very simply, fraud is an intentional misrepresentation, concealment, or omission of material fact done with the purpose of deceiving another which causes harm to that person.

 

NMEO:  Why should an organization be concerned about fraud?

RB:  The Association of Certified Fraud Examiners (ACFE) estimates that fraud costs organizations about 7% of their annual revenues.  The average scheme lasted 24 months before it was detected.  When times are tough like they are now, people are more likely to commit fraud, as they often see no other option.  Further, someone who would normally never consider committing a fraud may now be more driven to do so as an act of desperation.

 

NMEO:  What does a fraudster look like?

RB:  There is no psychological profile that can be applied to a fraudster.  Most are highly educated (bachelor’s or master’s degree) with no known prior criminal record.  The bottom line is that most fraudsters look just like you and me.  In almost every fraud, it is always a person in a position of trust that is committing the fraud.  It is the person who was like a “member of the family.”  We know this, so policies and procedures must be in place to hold everyone accountable.  Every person has a breaking point, we must accept this and keep our eyes, and ears open.

NMEO:  What motivates someone to commit a fraudulent act?

RB:  Fraud is a combination of three factors: pressure, opportunity, and rationalization.  Pressure can be related to a vice (drugs, alcohol, gambling) or a financial pressure like not being able to pay the mortgage.  Opportunity exists when there are weaknesses in internal control – I can commit a fraud and get away with it (or so I think). Rationalization is how “good” people convince themselves that the fraud is okay – “I am just borrowing the money, I’ll pay it back.”

NMEO:   Is there such a thing as a fraud-free workplace?

RB:  Sadly, I do not think so. There are different levels of fraud that range from the person who puts his/her personal mail in the outgoing mailbox at the office to the person who steals inventory and sells it outside of the normal course of business for cash.

NMEO:  What entities are most susceptible to fraud and why?

RB:  Non-profit organizations and small businesses are especially susceptible to fraud.  With small staffs (or in many cases, volunteers) often doing much of the work, internal controls are often weak, creating opportunities for fraud.  While the necessary checks and balances are often missing, there is a general thought that no one would take advantage of a non-profit but this is not the case.  In the ACFE study, small businesses were found to be the most vulnerable organizations (again, often due to a lack of adequate internal controls).

NMEO:  How can New Mexican organizations detect or prevent fraud from happening in the future?

RB:  Awareness, focus on internal controls, educating employees…these are some of the things that any organization can do; of course, this is just the starting point and it sounds much easier than it actually is.

NMEO:  If an organization already has a fraud hotline, how can they ensure that employees will actually use the hotline to report misconduct?

RB:  Employees need to be educated about the purpose and use of a hotline; merely having one does not guarantee that it will be used.  Management must express support for the hotline and it must be part of an overall ethics policy that is supported by management.

NMEO:  What are the pros and cons of using an internal versus an external hotline?

RB:  Internal hotlines have many barriers, most notably the fact that employees do not feel that they can anonymously report information since it is reported inside the organization (often to the human resources department).  External hotlines avoid even the appearance of impropriety and are staffed 24 hours a day, 7 days a week by interviewing professionals.

NMEO:  What does the average employee need to know about fraud?  Why?

RB:  Employees need to know that fraud impacts everyone.  As company profits suffer as the result of fraud, layoffs may be necessary, bonuses may not be paid and morale within the company will likely suffer.  It is important for the company to educate employees about what fraud is, what some of the warning signs are and, most importantly, what to do if fraud is suspected.  Educating employees is a good first step to preventing or detecting fraud within an organization.

 

In Perspective

Ethics, the Economic Stimulus

Has our own bad behavior negatively impacted our checkbook?  Ethics, or more aptly, an ethics recession, seems to have been a major factor in this economic crisis.

If we are going to get our economy back on track, we first need to understand what got us to this point and what can be done to assure that an ethics recession does not happen again.

The easy answer is that big, bad, greedy business is to blame, along with some high profile individuals like Bernie Madoff.  But that ignores a much more widespread “need“ for bigger, more and faster that has influenced decisions we make every day as consumers – not just those made by businesses.

A recent survey by ABC News reported that 73 percent of Americans think we all played a role in causing the current recession. The sub-prime mortgage crisis is a perfect example – for every willing lender there was a willing borrower.

“No credit, no problem,” became the mantra in the race to keep up with the Joneses. When the bubble of soaring home prices finally burst, the result was an unprecedented number of defaults, losses and foreclosures, and the value of everyone’s property began a steep decline that has yet to end.

Is the lack of regulation or proper oversight to blame? Clearly it could have helped prevent or at least mitigate the shady offshore investments of alleged fraudster Allen Stanford of the Texas/Antigua-based Stanford Financial Group, or Ponzi-schemer Madoff.

But recent history shows that legislating ethical behavior is not enough.  Even if regulations are followed and regulators are doing their jobs, it is impossible to create laws that can anticipate and account for every type of unethical behavior.

“When the focus is on compliance only, we look for an advantage by playing on the edge (of the law).   When we do cross the line ‘just this once’ and get away with it, it becomes easier to repeat,” says John Ackerman, retired University of New Mexico professor of business ethics.  It’s a combination of effective ethics laws, enforcement and the adoption and practice of ethical principles that will help us all live to higher standards.

As a society, however, we tend to be overly optimistic about our own moral judgment when comparing ourselves to others.  We like to think we are ethical, and when we hear of the misconduct of others, we indignantly ask, “What were they thinking?”  David Dunning, social psychologist, puts this into context by noting that “behavior is driven more by a situation than personality … so, what someone else does in a given situation is often an indicator of what we might do.”

If our current ethics recession and resulting economic crisis was caused by the actions of individuals and businesses together, what have we learned?

For one, we have learned that honesty is essential to stability, and that it cannot be bought, outsourced, downloaded or legislated.  And we have learned that bigger, more and faster does not necessarily translate into better. 

We also learned that confidence involves a certain level of trust - a requirement for any market to function.  “Trust,” according to writer and advisor Stephen M.R. Covey, is “the one thing that changes everything.”   In his book, The Speed of Trust, Covey asserts that “the ability to establish, grow, extend, and restore trust with all stakeholders - customers, business partners, investors, and co-workers - is the key leadership competency of the new, global economy.”   In this age, the core issues are no longer money and wealth, but character and integrity. 

To avoid repeating history, we can begin the process of building or reestablishing trust and accountability by starting with ourselves and asking the tough questions:

• Does our work provide us with a sense of purpose and meaning beyond the bottom line?
• Does our work add value to our stakeholders and contribute to a greater good we can be proud of?
• Are we committed to doing work with uncompromised excellence and integrity, no matter what?

We also need to acknowledge that if we collectively valued and tolerated the wrong things that led to our economic collapse, then together we can emphasize the right things to lift ourselves up.

With a strong commitment to good business ethics we can all:

• compel leaders to define the standards
• raise awareness and educate one another on expectations and responsibilities
• be mindful of the risk and potential consequences of our actions
• act as a resource and support for each other
• reach and aspire to higher standards than the law requires
• hold ourselves and others accountable for their actions

These practices – individually and collectively - will help build trust, inspire confidence and rebuild an economy the world can be proud of.  

If you would like to schedule a free extended presentation of “Ethics: the Economic Stimulus” for your group or business, please call (505) 277-0608.

 

Resource Corner

An Inventory of Ethics Practices

By: New Mexico Ethics Alliance © 2009

Synopsis From: New Mexico Ethics Alliance

 

This resource asks a series of questions about organizational practices that affect the ethical climate or culture within your organization.   The inventory contains 66 questions covering such topics as: communication, awareness, training, leadership, risk management, prevention, discovery, reporting, and accountability.   It is designed to assist you in identifying your organization’s current status and needs related to ethical practices. 

 

Once you have thoughtfully completed the inventory, you will have a better idea of your organization's current risk for an ethical breakdown.  Find out where your organization stands.  This can be your start to building and nurturing an ethical organizational culture.

 

This helpful resource is free for members of the New Mexico Ethics Alliance and non-members can purchase it for $49.00.  Call 505.277.0608 to order yours.

 

Words of Wisdom

The most precious asset of all is something that, if lost, can only be restored not by words but by actions.  That is the asset of trust and confidence.”  

 

Gordon Brown

British Prime Minister
2008

New Mexico Ethics Online, May/June 2009

Message from the Executive Director

Dear Allies,

This month we’re taking a look back at the 2009 Legislative session.  Up at the round house this year, Santa Fe was abuzz with talk of ethics reform.  Legislators from across the state introduced some new (and brought back some old) ethics bills.  As you’ll see from our status report, very few passed despite the well-intentioned work of many. 

If ever there was a year primed for ethics reform, 2009 was it!  So why didn’t they pass? 

Had the bills passed, would we have seen true reform?  Will the incidents of misconduct diminish as the laws governing behavior increase? What actually does change behavior?  These are the questions under consideration in this month's In Perspective article: Talking the Talk and Walking the Walk.

In the Resource Corner of this issue you will find one of many the great tools offered to New Mexico Ethics Alliance members on the members section of the website www.nmethics.org. The Federal Sentencing Guidelines apply to all types of organizations. We believe this resource will be helpful to you and your organization in developing an ethical culture.  We hope you’ll access it today by logging in to the Member’s Area of the New Mexico Ethics Alliance website.

If you or your organization are members but you have forgotten or misplaced your username and password, please send a reissue request to feedback@nmethics.org.  If you would like to become a member, we encourage you to join today and gain access to the resources on the website and many other great member benefits of New Mexico Ethics Alliance.

- Jill VonOsten, Executive Director

Get To Know…

2009 New Mexico Ethics Legislation Outcomes

New Mexico State Legislators introduced over 2,000 bills during the 2009 Legislative Session, which ended March 21.  Of those introduced, legislators passed only about 13 percent of them.  Ethics reform was a prominent topic in many legislators’ bills, as evidenced by the multiple bills that focused on reporting misconduct, limiting campaign financing, and increasing transparency in the state government.  Below we provide you with a list that highlights some of the ethics bills that passed and failed during the 2009 Legislative Session.

Passed:

Senate Live Audio & Video Webcasting (SR 4): Introduced by Sen. Mark Boitano (R) district 18, Bernalillo County:  SR 4 allows for live audio and video streaming of senate proceedings.  The Senate passed SR 4 unanimously on March 13, 2009 and Gov. Richardson signed the resolution on March 16, 2009. Rep. Ken Martinez (D) district 69, Cibola, McKinley & San Juan Counties introduced a similar bill.

 

Limit Contributions to Candidates and PACs (SB 116) –Introduced by Sen. Dede Feldman (D) district 13, Bernalillo County: SB 116 stipulates that New Mexico candidates running for state, legislative, and other offices can only receive limited campaign funds from individuals. This does not include a political committee, lobbyists, or state contractors.  An individual can donate $2,300 per primary election and $2,300 per general election to a non-statewide candidate (state lawmakers, etc.). An individual can give $5,000 per primary election and $5,000 per general election to a candidate for statewide office (governor, attorney general).  SB 116 goes into effect November 3, 2010. Until then, a candidate for either non-statewide or statewide office can accept an unlimited amount of money from a donor.  Laws that limit campaign contributions are in place in 45 other states.  The Senate passed SB 116 40-1 and the House passed it 49-17. Gov. Richardson signed SB 116 into law April 2, 2009.

Require Biannual Campaign Reports (SB 128): Introduced by Sen. Peter Wirth (D) district 25, Bernalillo County: SB 128 requires candidates and political committees to disclose campaign finances more frequently. Similar bills were introduced by Rep. Al Park (D) district 26, Bernalillo County and Rep.Gail Chasey (D) district 18, Bernalillo County. The Senate passed SB 128 37-3 and the House passed it 60-0. Gov. Richardson signed SB 128 into law April 2, 2009.

Open Conference Committees (HB 393): -Introduced by Rep. Joseph Cervantes (D) district 52, Dona Ana County:  HB 393 allows the public to attend legislative conference committee meetings. The House passed HB 393 66-0 and the Senate passed it 33-8.  Gov. Richardson signed HB 393 into law April 6, 2009.  Sen. Dede Feldman (D) district 13, Bernalillo County introduced a similar bill.

State Contractor and Contract Database (HB 546): –Introduced by Rep.Al Park (D) district 26, Bernalillo County: HB 546 requires all businesses that have contracts with the state of New Mexico that are worth $20,000 or more to be listed in an online searchable database. Business also must disclose their company name, contract, and contract value. The House passed HB 546 65-0 and the Senate passed it 39-0. Gov. Richardson signed HB 546 into law April 6, 2009. This bill goes into effect July 1, 2009.

Third-Party Investment Marketer Disclosure (HB 876): Introduced by Rep. Miguel Garcia (D) district 14, Bernalillo County:  Requires investment managers who invest state funds to reveal the use of third party marketers. Will help ensure more transparency of certain state investments. The House passed HB 576 60-0 and the Senate passed it 41-0. Gov. Richardson signed HB 576 into law April 7, 2009.

 

 

Failed:

Governmental Conduct Act for Public Officers (SB 49): Introduced by Sen. Linda M. Lopez (D) district 11, Bernalillo County:  The purpose of this bill was to amend and enact certain sections of the Governmental Conduct Act to include public officers and employees of all political subdivisions of the state; prohibiting certain acts by public officers and employees.  “Certain acts” refer in part to prohibiting coercion of another public employee, threatening to deny a promotion, stricter requirements for contracts between public officers and state agencies.  SB 49 died in the Senate Rules Committee. Rep. Joseph Cervantes (D) district 52, Dona Ana County, introduced a similar bill.

Enhance Felony Sentences for Public Officials (SB 141): Introduced by Sen. William H. Payne (R) district 20, Bernalillo:  This bill would have allow a court to increase the sentence of a public official, who committed a felony, by imposing a fine equal to a public official’s salary and benefits. The Senate passed SB 141 29-4 February 25, 2009, but it died in the House Judiciary Committee.

State Ethic Commission Act (HB 151): Introduced by Rep. Al Park (D) district 26, Bernalillo County:  HB 151 would have established an independent ethics commission to investigate alleged misconduct with appropriated $500,000 for the commission to carry out the State Ethics Commission Act.  The House passed HB 151 64-0, but it died in the Senate Rules Committee.

 

Budget Transparency Act (SB 159): Introduced by Sen. Sander Rue (R) district 23, Bernalillo and Sandoval Counties:  SB 159 would have provided for an online searchable database of state and other local government budgets.  The Senate passed SB 159 38-0, but it died in the House Taxation and Revenue Committee.  Rep. Dennis J. Kintigh (R) district 57, Chavez, Lincoln and Otero Counties introduced a similar bill.

Whistleblower Protection Act (HB 394): Introduced by Rep. Joseph Cervantes (D) district 52, Dona Ana County.  HB 394 would protect government worker whistleblowers from employer retaliation for disclosing alleged wrongdoing.  It would also allow government workers to sue their employers if their employer retaliated against them for reporting wrong doing.  The House passed HB 394 66-0, but it died after being added to the Senate Calendar.

Investment Contractor Contributions (SB 611): Introduced by Sen. Stuart Ingle (R) district 27, Chaves, Curry, De B Roosevelt Counties:  If passed, SB 611 would have banned campaign contributions from state contractors to candidates for state offices.  It died in the Senate Rules Committee.  Rep. Thomas C. Taylor (R) district 1, San Juan County and Sen. Tim Keller (D) district 17, Bernalillo County introduced similar bills.

Public Employees Returning to Work (HB 616): –Introduced by Luciano “Lucky” Varela (D) District 48, Santa Fe:   HB 616 would have Capped the amount that state employees in the Public Employees Retirement Association (PERA) system could earn. The bill included caps on the amount of money an employee could earn if they retire, collect full pension, and return to work. HB 616 stipulated that workers could earn no more than $30,000 per year.  The House passed HB 616 49-13 and the Senate passed it 40-0.  Gov. Richardson vetoed HB 616. A similar bill was introduced by Rep. Richard Berry (R) district 20, Bernalillo County.

 

In Perspective

Talking the Talk AND Walking the Walk

Want to change behavior?  Make a rule. Pass a law.  Right? 

Change often begins with the passage of new rules and regulations.  The problem, however, is that laws are often reactionary and usually the situation has to be pretty bad before legislative action is taken.  Bernie Madoff, Wall Street excesses, New Mexico politicians convicted of federal corruption – these and other recent news stories of ethics failures are appalling and seem to be never ending. 

We are all painfully aware of how bad it has gotten. 

In an extraordinary reform effort, New Mexico legislators introduced a multitude of ethics bills during the 2009 Session.  (Read the “Get to Know” Legislative status report).  We can be hopeful that the few ethics laws that passed this year will have an impact and will improve ethical conduct in New Mexico.  Yet, evidence suggests something more than introducing or passing new laws is needed to make reform a success. 

Take, for instance, two laws that aim to change driver behavior: laws requiring seat belt use and laws restricting cell phone use.  When you drive around the state, it’s hard to find anyone not wearing their seat belt these days.  In fact, according to the National Highway Traffic Safety Administration, over 90% of NM drivers and front seat passengers now buckle up, putting NM near the top of the list (#7) of 49 states with seat belt laws.  Meanwhile, Albuquerque has passed a law that bans cell phone use while driving, and yet, you need only look to the car next to you to see someone chatting away on their cell phone.  Both wearing a seat belt and not talking on the phone while driving have proven to be lifesaving behavior, not only to the driver but also to the community at large.  So why is one law successful in changing behavior and another not so much?

Pardon the pun, but so far the cell phone law is just talking the talk.  The law is on the books, but the call to action was dropped.  The seat belt law, on the other hand, has been bolstered by a robust public awareness and education campaign, a superblitz of enforcement and fines and point penalties that have held people accountable for their behavior.  This comprehensive approach to changing behavior works because it goes beyond merely stating the desired behavior, to actually following through with action that reinforces the intent of the law.

When it comes to changing behavior to combat political and corporate corruption, we need comprehensive programs that require both compliance with rules and laws and promoting awareness about ethical principles.  Lori Tansey Martens and Megan Barry from Ethikos and Corporate Conduct Quarterly interviewed thought leaders in the field of ethics and compliance. One interviewee, Jacqueline Brevard, Vice President, Chief Ethics and Compliance Officer, at Merck & Co., states “Compliance, as a subset of ethics, is all about the rules and should be a presumption in any business context. Ethics is about how far beyond the rules you are willing to go in order to maintain the integrity of your corporate culture.” 

Only nine percent of organizations in the U.S have strong ethical cultures according to the Ethics Resource Center (ERC).  Companies with a strong cultural approach to ethics are centered on ethical leadership, supervisor reinforcement, and peer commitment to ethics.  Ninety-one percent of companies either have weak ethics and compliance programs or none at all.  For this reason, many workplaces are breeding grounds for corruption and misconduct. 

Organizations with a comprehensive ethics and compliance program are the most successful at increasing the reporting of misconduct and lessening the incidences of misconduct.  This is evidenced by the fact that only “Twenty-four percent of employees observe misconduct in strong cultural environments — three-fourths fewer than in weak cultures (98 percent), and well below the national average (ERC).”   In companies with these programs in place, 71 percent of employees report ethical misconduct.  Increased reporting holds people accountable and helps to reduce misconduct rates.

            

There are several things an organization – a company, a government, an agency, a departmental or divisional unit, etc. - can do to create a more ethical workplace.  According to the ERC, they can:

• perform an assessment to determine which aspects of your company-wide ethical culture need improvement.

• use the assessment to establish measures of success. All levels of management should demonstrate the importance of ethical conduct.

• train middle management and supervisors on how to receive reports of misconduct.  Companies cannot completely depend on executive level communications to establish a comprehensive ethics and compliance program. The ERC reports that 90 percent of employees prefer to meet with an individual they already know, like a direct supervisor, to seek advice on ethics or to report ethical misconduct.

• assess and inform the employee population about misconduct reports. To assess employees, leaders can find out where employees go to find ethics advice and how they report misconduct. To inform their employees, leaders can discuss the outcomes of reports and how the concerns were addressed. This helps to create more transparency and trust in the work environment.

• create incentives for ethical courage. Employees are more likely to take risks if the company leaders demonstrate that they support, reward, and protect individuals who are committed to the highest ethical standards. Performance measures for upholding ethical standards should be included in employee evaluations.

Let’s agree not to be caught by surprise when the next ethical disaster strikes our respective organizations.  As New Mexico leaders – representing the .govs, .orgs, and .coms - let’s be proactive about pursuing ethics reform.  Meaning, we not only put laws on the books but we also act on them and hold each other accountable to even higher standards.  That kind of change in behavior will move us from a compliance mentality to an ethical culture reality.  It’s simply backing up our talk with our walk.

Resource Corner

The Federal Sentencing Guidelines & an Effective E&C Program Overview

By: New Mexico Ethics Alliance

In this issue, we are showcasing one of the many resources found on the Member’s Area of the New Mexico Ethics Alliance web site.  This and other resources can be accessed by current members of the Alliance by entering your log in information at the top of any page on our website.  Once logged in, you'll find this particular resource by clicking on the Ethics Resources Button and under the Ethics Essentials header, click on the Best Practices link.

This resource provides a clear description of the basics of the Federal Sentencing Guidelines for Organizations and why your organization must have an Ethics and Compliance (E & C) Program in place to protect itself.  It answers the question: What is an effective E & C Program?  It details seven key ingredients found in an E & C program based on the Federal Sentencing Guidelines.  This helpful resource also specifies the 10 modifications that the Guidelines recommend organizations take into account when working to build an ethical culture.  It answers questions that directors and executives may have about their role in E & C Programs, training requirements, and risk assessments.  

To access the Federal Sentencing Guidelines themselves, please visit the United States Sentencing Commission web site at www.ussc.gov.

Words of Wisdom

Ours has become a country of laws, not ethics.  As much as we want to argue that we are pursuing an ethics/values strategy the compliance strategy tends to emerge dominant.

Archie B. Carroll, Director,

Robert W. Scherer Professor Emeritus Dept. of Management,

Terry College of Business, University of Georgia

 

New Mexico Ethics Online, March/April 2009

Message from the Executive Director

Dear members and friends of the Alliance,

“Honesty is the best policy.” It’s true, we know it is, but sometimes being honest is not easy. When sharing bad news, facing difficult people, or under pressure to make tough choices, the truth can be put to the test.

Many of us may find ourselves in those kinds of situations lately. In this issue of New Mexico Ethics Online, we give you some tips, tools and resources that can help you and your workplace stay true when times are hard.

Our article, Straight Talk in Troubled Times, emphasizes the importance of honesty and transparency in stressful times and offers ways to confront difficult people and topics to achieve positive outcomes. A new, local organization, BullyFreeWork, is featured in the “Get To Know” Interview and their President offers advice for dealing with bullies head on.

The focus of our Resource Corner is a book by New Mexico authors, Mark D. Bennett and Joan McIver Gibson, entitled: A Field Guide to Good Decisions.  It recognizes that making good decisions is not easy and offers practical help that includes knowing your values, engaging others to understand theirs, and communicating with respect and candor.

The truth is we might all need a break from the anxiety and bad news.  If that is the case, don’t miss the chance to attend Albuquerque’s “feel good event of the year.”  Ethics Alliance member and partner, Samaritan Counseling Center, will host the NM Ethics in Business Awards dinner on Tuesday, March 31, 2009.  Businesses and individuals throughout the state will be recognized for their ethical conduct.  Call (505) 842-5300 for tickets.

If you haven’t done so already, join the growing list of individuals and organizations in the state who have become members of the Ethics Alliance.  Together, we’ll keep each other honest!

Get To Know…

BullyFreeWork is a New Mexico organization based in Albuquerque.  Its mission is to “improve organizational performance through effective people management.”  In this issue, New Mexico Ethics Online spoke to Michelle Detry, President of BullyFreeWork, about bullies in the workplace. 

BullyFreeWork provides free informational/overview sessions for professional associations and professional development groups. You can find out more about this organization on its website at www.bullyfreework.com.

New Mexico Ethics Online (NMEO):  Most of us have had first or second-hand experiences with the “school bully,” but what characterizes a bully in the workplace?

Michelle Detry (MD): A school bully and a workplace bully are very similar.  Both bullies can cause extreme stress, use verbal and physical intimidation, withhold access to resources and people, cause public humiliation, spread malicious rumors.  They often do this without the teacher or boss knowing it is going on, but cause the observers of the bullying behavior to also experience stress, anxiety and fear.

 

NMEO:  Is it common to find bullies in the workplace?

MD:  Research studies show 25% - 40% of US workers report persistent abuse at work.  Eighty percent of workers say they have witnessed workplace bullying sometime during their work histories.  Expect to see more bullying in the workplace as studies show that downsizing, organizational changes and managerial changes are key triggering precipitators of bullying behavior.

 

NMEO: In the hiring process, how could an organization screen for bullying behavior?

MD:  Behavioral interviewing is key to spotting potential bullies.  Also, spend time with the candidate - a one or two hour interview many not give you enough information to spot bullying tendencies.  Over a full day of interviewing, most people will reveal a lot of their true character.  Finally, go with your intuition.  Even if someone is highly skilled in the requirements needed for the position, if something about the person doesn’t feel right, it probably isn’t.

 

NMEO: Besides being an obvious nuisance, how do bullies impact organizations?

MD:  Bullying adversely impacts individual’s emotional, psychological and physical well-being and, as a result, negatively impacts the efficiency and effectiveness of work groups and the entire organization.  Seventy-five percent of those who have been bullied had to leave their jobs to make the bullying go away.  Even during tight economic times, employee driven turnover is a problem because you lose your good high-performing employees and end up with an “impoverished workforce.”  A company’s bottom line follows its emotional climate.

 

NMEO:  What safeguards should an organization have in place to effectively deal with bullying behavior? 

MD:  All organizations should include a policy against bullying behavior as part of the code of ethical conduct or ethics statement.  It also needs to be part of every organization’s anti-harassment policy.  The best way to prevent bullying behavior is to create an organizational climate that does not tolerate bullying and especially doesn’t reward that behavior.  Many companies unknowingly reward bully behavior through performance systems and sales quotas that encourage overly aggressive behavior.

 

NMEO:  If I am being bullied by a fellow co-worker how should I respond?

MD:  Let your boss and HR manager know about the problem sooner rather than later.  Waiting for things to improve almost never pays off.  Keep detailed records to present a clear account of the bully’s behavior.  Observe to see if the bully has other “targets” besides you.  If they do, work together with the other targets to better explain the problem to management.  Get support from friends, family and your organization’s Employee Assistance Program (EAP), if they have one. 

 

NMEO:  What if the bully happens to be my boss? 

MD:  Foster a relationship with a powerful mentor who can provide needed political and emotional support.  Talk with your peers for support and possible intervention with the bully as a group.  Again, keep detailed records so you can clearly and factually illustrate the problem and specific events.  Don’t wait too long to look for other opportunities within your organization, and you may need to consider leaving the company in order to protect your own health and well being.

 

NMEO:  What can I do if my manager won’t deal with the bully?

MD:  Go to HR or your boss’s boss.  Factually document what you are experiencing.  Provide specific, concrete and consistent information when you tell your story.  Show consideration for others’ perspectives but don’t “own” the problem or question your abilities.  Develop a plan of action with specific timelines including a date to start looking for another job.

 

NMEO:  Is there any encouragement that you could give to those dealing with a bully right now?

MD:  You are not alone.  Find someone, usually outside of your organization to talk to about the problem.  Use your EAP, find a good therapist, or join a support group so you can improve your stress management, conflict resolution and coping skills.  There have been some good books recently written that can provide guidance and options too. 

 

In Perspective

Straight Talk in Troubled Times

The economy has us all worried.  Employers are worried about making payroll and whether they will have to cut services or benefits or layoff employees.  Employees are concerned about the possibility of pay cuts, furloughs, or losing their jobs.  All that worry can make for a tension-filled workplace.  

 

Add to this the increased pressure to perform better, to sell more, and to do more with less.  The anxiety and pressure can create friction between doing what’s right and meeting demands.  All too often the net result is unethical behavior.  Whether fraudulent and illegal acts or morale busting behaviors like bullying, slacking, and bad mouthing, all are damaging and add even more pressure to a stressed-out work environment. 

 

Though we might be tempted to avoid dealing with these behaviors and see them as mere distractions from our pressing financial matters, the reality is they cost us dearly.  Avoiding the issues won’t make them go away.   But how do we address them without bringing down morale or making a bad situation worse?

 

First, recognize that silence does not solve the problems; it allows them to get worse by creating undertones of resentment, disappointment, and suspicion.  Productivity suffers, morale goes down, and employees may choose to miss work to avoid dealing with “stressful” behavior of others.  According to “Positive Confrontations,” an online article published by Strategic Finance, almost “50% [of employees] had thought about changing jobs to avoid the instigator, and 12% actually left their job to get away from the unwelcome behavior.”   

 

Fear is often behind the delay or avoidance in dealing with the behavior or the failure to report or attend to misconduct.  As people envision discussions about bullying or slacking they imagine disastrous results such as retaliation, worsening work conditions, or having to find another job.  These issues become heavier over time and spill over at unexpected and inopportune moments.  If you do not make an effort to discuss and resolve difficult issues, the workplace can become unproductive, hostile and corrupt.  Consequences none of us can afford in today’s market. 

 

Tackling the difficult issues is crucial if you want to create a work environment where honesty and transparency allow for an ethical workplace culture to thrive.  In their book A Field Guide to Good Decisions, New Mexicans Mark D. Bennett, and Joan McIver Gibson describe a specific case of how one leader’s transparent communication and explanation about a difficult decision helped protect his business’ reputation.  In this example, Metro Medical CEO, Ralph Wallerstein, had a frank discussion with employees about a choice he had to make.  He could either accept the donation of a van which could expand their mission and serve the community (but came with added operating costs) or he could honor his promise and distribute first-ever employee bonuses.  In a press conference, Wallerstein told his employees and the media that he could not afford to keep the van and pay out employee bonuses.  He explained why the decision was so difficult, what “he didn’t like about the decision,” and why, in the end, he made the choice he did.   Wallerstein chose to distribute bonuses because his employees had met and exceeded budget expectations for the first time in seven years and he wanted to keep his promise.  In short, by being frank with his employees, and the community, Wallerstein kept his promise and avoided damaging his company’s reputation (pg 71-72).  

 

Both managers and employees alike need to have conversations, and sometimes confrontations to get past the issues.  Doing so can be key to your business’s success.  There are, however, good and not so good ways to enter such conversations. Here are some things to consider when you begin a difficult discussion:

• “Be thoughtful in how, when, and to whom you voice your concern.” 1
• “Prepare/Consider all stakeholders, try to anticipate possible outcomes, and identify effective solution(s), or approach(es) to the problem.” 1
• Have a win-win goal in mind. If you begin a conversation with the intent to destroy someone’s credibility all parties involved stand to lose. 2 
• Focus on the issue. Do not enter conversations to argue your point of view. Listen to the other party’s point of view, and seriously consider the solutions he or she offers. 2
• Make others feel safe. Show your concern, clarify your intent, and ask questions for clarification. 3
• Self control is a must. Avoid sarcasm, insulting humor, guilt trips, and other forms of verbal violence and emotional outbursts. 4
• Ask for a time out. During heated discussions this can benefit all parties involved. 2

 

Remember that both people (inside and outside the organization) and profits are affected by unresolved conflict and stress in the workplace.  Transparency, honesty, and mutual respect are all necessary for building trust and maintaining a work environment with integrity.  When difficult issues are addressed early and handled properly there are fewer problems and more benefits all around.  By following the guidelines above, your organization can weather difficult times, maintain its credibility, and strengthen its ethical culture.

_________________________________________________

1 Prof. Sarah D. Smith, Presentation “The Employee Imperative: Voicing Concerns in the Work Place,” UNM, Anderson School of Management, 2008.

2  “Positive Confrontation? Yes, it’s Possible, and it Can be a Good Learning Experience,” 01 Feb. 2006, Strategic Finance, 23 Jan 2009. <http://goliath.ecnext.com/coms2/gi_0199-5293815/Positive-confrontation-Yes-it-s.html.>

3 Kerry Patterson and Eric Patten. “Crucial Conversations: Working with Difficult Leaders,” 2009, Management Consulting News, 23 Jan 2009. <http://www.managementconsultingnews.com/articles/patten_patterson_article_oct06.php.>

4 “Learn How to Speak Up Effectively about Difficult Issues at Work with these Simple, but Powerful Skills,” 2005, VitalSmarts, L.C, 23 Jan 2008.

Resource Corner

 

 

A Field Guide to Good Decisions: Values in Action

By: Mark D. Bennett and Joan McIver Gibson

Publisher: Westport, Conn.: Praeger Publishers

ISBN: 0275989372

Synopsis From: BooksInPrint.com™ Professional

 

Decision making is always personal. Each of us makes important decisions at work, in the community, and at home. When we face tough choices, what we decide reveals what really matters to us; how we decide determines whether we succeed or fail. Business executives, community leaders, and family members all struggle with difficult decisions: a senior management team makes an important choice about whether to pursue an acquisition; a baby-boomer decides whether to place an elderly parent in assisted living; a non-profit administrator considers laying off employees to have money and continue serving the community. For each, the steps toward a good decision are the same: know your values, engage others to understand theirs, and communicate with respect and candor. Simple in concept, not so easy in practice--but making a good decision demands nothing less.

 

Developed over twenty years in settings as diverse as hospital bedsides and corporate boardrooms, A Field Guide to Good Decisions provides the skills to make decisions that reflect your core values while respecting those of others, including the long-term implications for all participants. Illustrated through many real-life examples that will resonate with readers both professionally and personally, A Field Guide to Good Decisions offers practical tools and techniques for identifying individual and common goals, reaching consensus, and communicating the results effectively. The authors also show readers how to overcome common obstacles to good decision-making (psychological, cultural, and organizational). Ultimately, this book is about making decisions which, while not always a matter of life or death, nevertheless have a powerful effect on our sense of self, our credibility in the eyes of others, and the lives of those touched by the choices we make.

 

Words of Wisdom

The void created by the failure to communicate is soon filled with poison, drivel and misrepresentations.

C. Northcote Parkinson

British naval historian and author (1909-1993)

 

New Mexico Ethics Online, January/February 2009

Volume 2, Issue 1

Message from the Executive Director

Dear members and friends of the Alliance,

It’s 2009!  New year, new aspirations and with the economy in turmoil, new challenges await organizations and communities throughout the state.  

NOW, more than ever, is the time to invest in ethics! 

You should know that misconduct rises as much as 11% when financial and economic turmoil rocks your organization.*  Employees, supervisors and managers all feel pressure to meet goals – and even cut corners.  It happens.  You’ve read the headlines over the last few weeks and months and you have seen the evidence.

Research shows that an effective ethics program - together with steps to create an ethical culture – cut ethics risk.  To change the economic reality, we need to restore and bolster public confidence in the fairness and integrity of our markets, our businesses and our governments.

What should you do to cut your risk? 

You can start by raising the awareness of ethics and the potential for increased misconduct in your organization.  Bring attention to ethics now to avoid the temptation to cut corners in the future.  Start by reading and sharing this issue of New Mexico Ethics Online with others.

Most of us have good intentions.  That is evident when you read the New Year aspirations of the many individuals we talked with for the “Get to Know” interview.  Or should I say, interviews.  New Mexicans, from all walks of life, shared their personal and principle-based “ethical” resolutions for the New Year.  Their answers are reflective and inspiring!

In this issue, our feature article is entitled, “Drive on Principles.”  It looks at the limitations of rules in promoting ethical behavior and the benefits of actively promoting and incorporating principles in your organization. We give you some practical advice on ways to make principles drive your organization.

If you would like to learn more about the role principles play in ethical organizations, look to our Resource Corner for a synopsis of Steven Covey’s book, Principle-Centered Leadership.  It’s an oldie, but a goodie and it’s available for checkout in the Ethics Alliance Library.

We, at the New Mexico Ethics Alliance, send you best wishes for an ethical and therefore prosperous New Year.

-  Jill VonOsten, Executive Director

* Ethics Resource Study, 2008. www.ethics.org

 

Get To Know

                                                                                   

…interviews with New Mexicans

This issue’s interview is a bit different.  This month we took to the streets to ask individuals of all ages and backgrounds about their New Year’s Resolutions.  We were interested in a resolution with a twist – an ethical resolution, if you will.  Though not your typical resolutions of personal health and fitness, they do require the same type of focus, dedication and committment in order to achieve success.  New Mexico Ethics Online asked eveyone the same two questions;

• “In the context of New Year’s Resolutions, what would be your personal ethical resolution for the New Year?”

After answering the question, we showed the interviewee a list of Some Universal Ethical Principles from our website, and ask them to:

• “identify the principle you feel most represents your ethical resolution.”

Read their answers, but as you do, ask yourself: “What is my personal ethical resolution for the New Year and what is the ethical principle that inspires it?”  If you understand and believe in the principle behind the aspiration - this might just be one News Year's Resolution that you can really keep!

 

 

“I’d like to be as fair as possible as a teacher.

I would identify this goal with the ethical principle: Pursuit of Excellence.”

- Al Nosedal, Teacher Assistant & UNM Ph.D Candidate, Statistics

 

“I want to be more efficient with my time at work.

I would match this resolution with the ethical principle: Fidelity.”

  - Marcos Anaya, Budget Analyst - US Forest Service

 

 

“Along with the new year, comes my final semester in college and time before moving out-of-state for work. For this reality, I will contribute a substantial amount of time and effort to the communities that I have been lucky enough to live in for the past three years. I also plan on being the best friend, brother, uncle, and son that I can be.

Fidelity: Being faithful and loyal to the people in my life is something that I take seriously and look forward to fulfilling even more;

Caring for Others: It’s a tough world out there and being there for someone is something that can mean the world to someone; whether it be helping out at a homeless shelter or going the extra mile with something you didn’t need to;

Respect for Others: A world without respect isn’t a world I’d like to live in.”

 - Michael Curry, UNM Student

  

“I want to be to true to myself no matter what, in every aspect of my life.

 

Honesty: I need to be honest with myself when it comes to my life, and

Pursuit of Excellence: I have to perform every task in my life to the best of my ability and not let my insecurities get in my way.”

 

 - Rhonda Van Buskirk, Graphic Designer

 

“It would probably be educational time for my son…I’d like to set time aside and teach him Navajo at home. That will coincide with instilling him with his culture.

Honesty: You have to be honest about who you are and where you’re from, and

Caring for Others: because I’m caring for and teaching my son.”

- Merlin Yazzie, UNM Student

  

“To strive to tell the transparent truth!  

 I would identify this resolution with Accountability – speaking the transparent truth for me is being accountable because it means saying what I mean and meaning what I say.”  

- Amber Harris, Agency Contact Person, MetLife

 

 

 In Perspective

Drive on Principles

“Follow the rules!”  A lesson taught in childhood and one intended to guide us to do the right thing, not to mention help us get along with others at home, school, and at work.  So, if everyone at work just followed the rules, would we really have ethical workplaces?

No doubt, rules are important. They provide clarity, they give us direction and they establish a base requirement for how we should behave.  Without rules, there could be mayhem. But when it comes to encouraging ethical behavior, rules can be limited. 

For one, if you tried to create a rule for every possible form of misconduct, it’s possible you would end up with a code of conduct as onerous as the tax code and with more pages than all of the books in the Library of Congress.   In describing the letter of the law, rules can sometimes lack the spirit behind the law’s creation.  Rules can not cover it all.

Secondly, rules are black and white.  With rules, you’re either completely wrong or absolutely right.  But what happens when you must decide between two seemingly right choices?  Or what if the issue falls in a gray area – where there is no clear wrong or right?  In work cultures that firmly stress “following the rules” over other decision making strategies, employees can be at a loss when faced with dilemmas that fall in this gray area.  

Finally, rules involve authority, hierarchy, rigidity and absolutes.  Because they tend to be top down, rules run the risk of reinforcing a power structure that relies upon a “might makes right” mentality.  This can be dangerous, especially when it turns out that those in power are not so ethical themselves.  Rules exist outside the person to whom they are applied and inherently imply punishment when they are violated.  That works great when the rule is a fair and just one.  Not so great, when the rule itself is flawed and must be challenged to be set right. 

Lawrence Kohlberg, a renowned psychologist and researcher of moral education and development, said that moral reasoning (the basis for ethical behavior) can be grouped into three levels: pre-conventional, conventional, and post-conventional:

a. a pre-conventional thinker would follow the rules to avoid punishment or because they see it would be in their own best interest; while,

b.  a conventional thinker would reason that rules are important in making society work and therefore find it their duty to follow them, and 

c. a post-conventional thinker uses universal ethical principles – such as honesty, fairness, trust, accountability and mutual respect as a basis for their moral reasoning.  Post-conventional thinkers find rules to be valid as long as they are grounded in justice and that a commitment to justice carries with it an obligation to disobey laws they find unjust.  This level of reasoning takes a committed effort.  One acts because it is right, and not just because it is instrumental, expected, legal, or previously agreed upon. 

Imagine what it would look like if your organization was driven by ethical principles.   Rather than be fearful, absolute and automatic in their responses, employees would engage in careful thought and inquiry when facing dilemmas.  These principles would be reflected in the actions of organizational leaders and employees at all levels.  People on the inside and outside of the organization would understand the motivations of the decision-makers because they would be based on universally understood principles.  

But how does an organization become driven by principles? 

To begin with, your organization must create a shared value system that is based on universal principles.  In his book Principle-Centered Leadership, Steven Covey listed some questions that organizations should ask themselves in determining their value system:

• What do we value?  What principles make our organization work?   In order for the value system to be successful, the strategy and style of principles need to flow with, not against, the core values of your organization.

• The values of your organization need to be defined. Asking questions such as: “What is our definition of honesty?” and “How will honesty be portrayed in our organization?” will help clarify the meaning behind your values and the behaviors you all hope to see exhibited. 

All internal stakeholders need to be included in this exercise.  Once they are defined and agreed upon, these values need to be reinforced.  A values exercise is not something you do once, rather, it is meant to be acted upon again and again.  Covey says "if organizations do not have a core value system based on ethical principles, they are building their system on a foundation of sand."  They might have valuable things around, but none of that matters if they are going against the flow of their values.  

Taking the lead in determining the values of your organization is a big step in the right direction.  However, figuring out the values and acting on them is still not enough.  What is vital is that leaders must take the lead in principle-based decision making.  Followers always look first to the leader, so leaders need to set good examples.  How can leaders set a good example? 

• Be open and transparent.   

• Be accountable for their actions.   

• Be sincere in their efforts to live according to the organization’s values.

These characteristics are important for leaders of every organization to follow, but for an organization to be driven by ethical principles, it must go deeper than the top dog.  They must be shared by all in the organization.  And in this way, we are all leaders. 

To drill even deeper, principles must penetrate the entire organizational system.  Do so by incorporating principles in your organization’s vision, mission, and code of conduct; by screening new hires to determine if they agree and ascribe to your organization’s ethical principles; and by heightening awareness and training of all employees to be assured that everyone understands and shares the meaning of the principles. 

These are just some of the practices that help principles have influence at every level of your organization.  And if you want to see an ethical workplace in the future, do not forget to recognize and reward those employees and co-workers who act on the principles. 

Creating a principle-centered organization is not easy.  It is not clear cut, black and white or absolute.  It requires leadership, agreement, commitment, cooperation, accountability and community to make it work.   However, the result is a workplace that pursues excellence, that strives for the spirit behind the rules, and that embraces an ongoing journey to think and act on a higher level. 

 

Resource Corner

Principle-Centered Leadership

By: Steven R. Covey

Publisher: New York: Summit Books

ISBN: 0671749102

Synopsis From: BooksInPrint.com™ Professional

 

Ineffective people try to manage their time around priorities, says Steven R. Covey, whereas effective people lead their lives and manage their relationships according to principles - natural laws and governing values that are universally valid.  Leadership is the ability to apply these principles to problems, resulting in quality, productivity, profitability and win-win relationships.

In this guidebook to personal fulfillment and professional success through “principle-centered leadership,” the author of the best-selling The 7 Habits of Highly Effective People invites readers to center their lives and leadership around timeless principles.  He shows how no person or organization can be content to stay where they are - how the goals of excellence and total quality express an innate human need for progress in personal, interpersonal, and organizational life.

 

Words of Wisdom

"A people that values its privileges above its principles soon loses both." 

- Dwight D. Eisenhower