HR Does Not See Rewards for Ethical Behavior

April 22, 2003 (PLANSPONSOR.com) - Nearly half (49%) of HR professionals believe ethical conduct is not rewarded in business today, as nearly a quarter feel pressure to compromise their organization's ethical standards.

Overall, 24% of HR professionals feel pressured to compromise ethics standards all the time, fairly often or periodically compared to just 13% indicating they felt pressured in 1997, according to the joint 2003 Business Ethics Survey conducted by the Society for Human Resource Management (SHRM) and the Ethics Resource Center (ERC).

The need to follow the bosses’ directives was given by 49% of the 462 respondents as the number one reason they felt compelled tocompromise an organization’s ethical standards. Other reasons given included:

  • meeting overly aggressive business/financial objectives (48%)
  • helping the organization survive (40%)
  • meeting schedule pressures (35%)
  • wanting to be a team player (27%).

Ethics are definitely in the collective corporate conscience, as 79% of respondent organizations have written ethics standards. Further, HR professionals say 70% of senior management and 72% of CEOs are committed to acting ethically, up from 68% and 69%, respectively, saying the same in the 1997 survey. The actions of the top have a trickle down effect, as respondents indicate more than eight out of 10 employees follow written ethics standards all the time or often.

Examining by what measures ethical standards are developed, the survey found the views of HR professionals are strongly affected by the actions and behaviors of colleagues and supervisors. The factors that most influenced their behavior were their own personal values, followed by attitude/behavior of senior management, credible enforcement of ethics violations and the attitude/behavior of supervisors.

HR Role

“As we’ve seen numerous times over the last year, companies that failed to live up to their code of ethics are now financial shells compared to what they were, and many people’s lives have been adversely affected,” said SHRM President and Chief Executive Officer Susan Meisinger in a statement. “HR must do more than clean up the mess after the damage has been done. They have a responsibility to step up and ensure that their organizations maintain cultures that demand ethical behavior.”

The majority (69%) concurs, strongly agreeing that HR is a primary ethics resource in the organization, but 40% say that HR is not part of the ethics infrastructure and is only tasked with cleaning up ethics violations. Pressure comes from the top as well, as 85% of respondents said senior management supports HR professionals adherence to organizations’ written ethics standards.

As the watchdogs, only 35% of HR professionals often or occasionally personally observed ethics misconduct in the last 12 months, down from 53% in 1997. Types of misconduct most commonly observed were:

  • misreporting of hours worked
  • employees lying to a supervisor
  • management lying to employees, customers, vendors, or the public.

By industry, HR professionals in government (55%), health (44%) and wholesale/retail trade (43%) are among those observing the most misconduct. Conversely, manufacturing of durable goods (20%) and finance (25%) indicated the least ethics misconduct over the last year.

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