Sternberg suggests that to behave ethically, you have to first go through a series of stages of reasoning:
1. Recognize that there’s an event to react to, that it has an ethical dimension and that it’s serious enough to require an ethical response. Ethical drift means that questionable behavior is simply the norm and therefore not questioned at all. One leader I know who has a huge amount of integrity asks the question, ‘If this situation was printed on the front page of the New York Post or the UK’s Sun, would you be comfortable with it?’
2. Take responsibility for generating an ethical solution. Even if employees recognize there’s a moral issue at stake, the typical response is ‘it’s none of my business’. We assume that if it’s OK with the boss, it’s OK with us. With all the other competing priorities – revenue, profit, quality, customer service, team engagement – ethical decision making can be demoted to a footnote.
3. Figure out what ethical rules apply. What are the principles that apply here? Organizations often develop values statements or charters to support leaders in making these decisions. Johnson & Johnson JNJ +0.85%, who frequently top the charts in terms of being a reputable brand, constantly refer to their Credo.
4. Decide how to apply those abstract rules to the situation in order to suggest a concrete solution. This is where it gets interesting as it involves managerial judgment. It’s also perhaps the hardest step, as values statements and credos can quickly become inane platitudes plastered on mouse mats and canteen posters. Instead leaders and managers have to judge the dilemma. In one values project I worked on with a global consultancy we set up dilemmas that the leaders had to resolve. Two of the values were, and I’m paraphrasing here, ‘Caring for people’ and ‘Delighting clients’. No one would disagree with either. We then collected real situations where these values collided. One dilemma was: ‘You are working on one of the firm’s most important clients. On Friday afternoon, the CEO unexpectedly calls an emergency board meeting on a Sunday morning. The lead consultant is the only person with the knowledge to effectively put together the papers for the board meeting. The lead consultant is the best man at a wedding on Saturday. What do you do?’ A second dilemma involved the discovery that a consultancy project had run a significantly negative ROI for the client. What’s the appropriate course of action here? It was in these conversations that the values and the practice of ethical decision making came to life.
5. Prepare for the repercussions. There’s no shortage of whistle-blowers who’ve been ostracized, ridiculed or even attacked. Look at Greg Smith, the former Goldman Sachs employee who famously penned a New York Times article branding the organization’s culture ‘toxic’ and ‘morally bankrupt’. Goldman Sachs investigated his claim and responded by revealing that he was ‘off the charts unrealistic’ about his own ability.