Many people believe that organizational structure and management systems are hard and neutral. It’s not true. Your organizational culture is not something that just happens; it is a reflection of your systems, structures and perhaps most important, people. It doesn’t exist separately. It reflects what is and isn’t cared about and rewarded.

In a previous position where I led the turn-around of a distressed organization, I remember doing my first walk through and coming to an area where four people shared a common area with one wastebasket. There were papers overflowing onto the floor and it was a mess. When I asked them why there was one wastebasket for four people they all exchanged glances and said it wasn’t for a lack of asking for more, it was a lack of response to multitude requests. Was it any wonder the organization was in a heap of trouble?  Could anyone be surprised that employee morale was as low as could be?

Developing a superb organizational culture has many components with three of the most important being the tone set at the top, having an ethics or compliance program that is enforced and providing ongoing communications about ethics.

The 2006 KPMG Integrity Survey took a behind-the-scenes look at corporate fraud and misconduct in the post-Sarbanes-Oxley era. It was based upon responses from 4,056 U.S. employees, spanning all levels of job responsibility. Nearly three of four employees reported that they had observed misconduct in the prior 12-month period, with half of employees reporting that what they had observed was serious misconduct that could cause “a significant loss of public trust if discovered.”

Following are interesting statistics from the report reflecting the differences in companies where defined ethics/compliance programs exist.

 

Question                                   With Ethics/Comp Program                    Without

Would you report unethical behavior	73%	28%
Do you believe appropriate action would be taken	97%	44%
Do you believe you would be protected against retaliation	75%	29%
Do you believe the CEO and senior staff value ethics over short-term business goals	92%	28%
Do you believe the CEO and senior staff would respond appropriately if aware of misconduct	99%	36%
Would people exhibit a high commitment to integrity	90%	49%
The willingness to tolerate misconduct is minimal	94%	35%

 

Clearly, having a strong ethics program brings employees comfort that the organization cares about and will do the right thing. Given that 75% of employees see misconduct, you want them to feel safe that they can report a malfeasance. According to the National Business Ethics Survey (NBES), there is a clear link between effective communication programs and increased reporting of misconduct. When the organization communicates about ethics, employees feel more comfortable reporting issues.

The best campaigns teach employees how to recognize and report unethical behavior while using a positive tone. The presence of the anonymous, confidential incident reporting service you have from Ethical Advocate can deter fraud. The purpose and nature of the service should be mentioned in all ethics communications, but should not be the only focus of communication. This will enhance the program by nurturing an ethical environment and helping honest employees realize they can help the agency by reporting harmful activities.

An ideal communications campaign includes messages from top organizational to demonstrate support from the top. This can be achieved through memos, newsletter articles and discussions in employee meetings.  The point is to communicate to your stakeholders as frequently as possible, in writing, in meetings, and via any and all means available.  And most important of all is the tone of honesty and integrity management and executives set.