Business Ethics – Three Ethical Questions – What would you do? Comments by Business Ethics Speaker Chuck Gallagher

Just this past week, I had the opportunity to speak to an international construction company that ranked 14% points higher than it’s peers when it comes to “business ethics”.   In this day and age, that is quite an accomplishment.   With increased pressure to perform, the temptation to cut corners and justify unethical behavior has never been greater – not at least in the past several decades.

As I approached the end of the presentation, when the floor was open for questions, one brave gentleman asked an interesting question:

A company I was working with had bid on a construction project for a municipality.  The six members of the city council voted unanimously to award the firm I worked for the contract.  We were set to celebrate when I received a call from the city manager’s office asking me to visit.  When I arrived I was told that all that stood before me and the awarded contract was $50,000.  I was, in effect, asked to pay $50,000 bribery to gain the contract.  I declined!  Needless to say, the contract was awarded to another vendor.  THE QUESTION:  What would you advise us to do under those circumstances?

Prior to this question being asked I had finished talking about the three components that come together when ethical people make unethical decisions:  NEED, OPPORTUNITY and RATIONALIZATION.  As I heard the question, it dawned on me that his question was a real life example that was clearly on point.  Let’s review.  In order to grow the business you need to have contracts awarded – in this situation there was clearly NEED.  If the company didn’t have a need, they would not have bid.

They could have won the contract – they had the OPPORTUNITY.  All they had to do was agree to payment and the contact would have been awarded.  What a small price to pay for the current business and the opportunity for future business.

RATIONALIZATION – that was easy, we are pressured to perform and after all, everybody does it.

There you have – the three components were there.  The perfect storm existed and the outcome – NO THANKS.  But with that two more questions arose.

If I had been working for this company and made the same decision, would senior management have supported my decision?

That question, especially in a presentation setting, was easy to answer by the Chief Compliance Officer.  The answer was predictable and I believe honestly answered.  Yet, I could tell by the look in many of the participants eyes, that they could identify with the quandary posed by this scenario.  Does the need for business outweigh the practical application of ethics?  But beyond that question – the last question asked seemed more profound.

Knowing that what I was asked to do was wrong, unethical and potentially illegal, should I report the request for a bribe to law enforcement and risk getting ostracized from the construction community or should I keep my mouth shut and just accept that I lost the bid?

This was a powerful question – and a question that had many scratching their heads (so to speak).  Does one have an obligation to become a “snitch”?   I have to admit, the answer to that last question was not so easily black and white.  Let’s say you did report and as a consequence you found that governmental entities elected to ignore your future bids or refused to allow you to bid – was standing up for ethics worth the cost?  Or let’s say you didn’t report the illegal act request and just took your lumps – only later to find that an investigation was underway and you were implicated for conspiracy since you didn’t report the behavior.   What is the ethical answer?

One thing I clearly learned…ethical companies don’t shy away from the tough questions and are willing to spend the time and money to train their employees so that ethics and ethical choices become second nature.  Every choice has a consequence and the choices that follows good ethics are what keeps companies in business for generations.

Here’s a link to the SKANSKA ethics hotline – which serves as an excellent example for other companies to follow:  http://www.skanska.com/en/About-Skanska/Code-of-Conduct/This-is-how-Skanskas-Code-of-Conduct-Hotline-works/

This company is second to none when it comes to their commitment to ethics and ethical behavior.

YOUR COMMENTS OR ANSWERS TO THE QUESTIONS ARE WELCOME!

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2 Responses to Business Ethics – Three Ethical Questions – What would you do? Comments by Business Ethics Speaker Chuck Gallagher

  1. Ruby Clifton says:

    With the fall in moral standards, bribery in every walk of life has become a rule rather than an exception. In certain third word countries, you simply can’t get the work done without greasing the palm of the officials. The system rots from top to bottom.

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