A new global business ethics survey released Tuesday by the Ethics & Compliance Initiative (ECI) found employees are experiencing more work-related pressure as compared to before the coronavirus pandemic.
According to the ECI’s “2021 Global Business Ethics Survey,” which polled 14,000 employees across 10 countries, the plurality of respondents (44 percent) said they were experiencing more work-related pressure as a result of the pandemic, followed by 28 percent who said they observed no change. Another 20 percent said they’ve never felt work-related pressure, and 7 percent said they’ve experienced less pressure.
Pressure came from a variety of sources, the ECI found. Respondents cited meeting performance goals (49 percent), always being available (49 percent), and showing contribution(s)/value (46 percent) as the top three causes. Other pressures cited included those related to job security and the need to minimize costs and/or generate more revenue (42 percent each).
The effects of COVID-19 did not seem to impact observations of misconduct, however. According to the survey, 30 percent of respondents said they had observed about the same amount of misconduct before and after the start of the pandemic. In contrast, 23 percent said they observed less misconduct, while just 9 percent said they observed more.
In looking at what trends might lie ahead, the report noted “recessionary tactics,” such as hiring freezes and production slowdowns, could adversely impact workplace ethics and culture, as indicated by historical data. “If the economy worsens and organizations react by implementing recessionary tactics, it is strongly advised that they take precautionary action to limit increases in pressure, misconduct and retaliation, and support behaviors that epitomize a strong ethics culture,” the ECI said in its report.
The survey uncovered some positive news, showing “culture strength” in the United States is at one of its highest points in 20 years. According to the findings, 21 percent of respondents noted they were in workplaces with a strong ethical culture.
“These findings reveal that the E&C profession in the United States continues to make substantial progress by instilling elements that encourage ethical behavior and promote ethical culture in the workplace,” the ECI said. “A strong ethical culture is characterized by accountability for wrongdoing, trust in and communication from leadership, and all employees setting a good example of ethical workplace behavior.”
“Rates of reporting misconduct” remain high as well. Employees who observed misconduct in 2020 were more likely to report it than they were in 2017 (86 percent versus 69 percent).
The most frequently observed types of misconduct cited were management lying to employees, conflicts of interest, improper hiring practices, abusive behavior, and health violations. Thirty-five percent cited “favoritism of certain employees,” a data point that was not tracked in 2017. Taken together, 49 percent of U.S. employees observed at least one incident of fraud, waste, and/or abuse.
The ECI data also showed concerningly high retaliation rates against U.S. employees reporting wrongdoing. In 2020, the rate was 79 percent, compared to 44 percent in 2017 and 22 percent in 2013. “If left unaddressed, high rates of retaliation can erode ethical culture and undermine efforts to encourage employees to speak up and raise concerns,” the ECI said.
Global trends largely mirrored the United States, according to the ECI. On one hand, reports of misconduct reached the highest point since the organization began collecting global data in 2015. On the other hand, “pressure to compromise standards and rates of retaliation are also at their highest points since 2015,” the ECI said.
Overall, the survey found, some countries experienced higher levels of pressure, including China, India, Mexico, Spain, the United Kingdom, and the United States, while others—Brazil and Russia—experienced less pressure. Employees in China were most likely to experience pressure (53 percent), marking a fivefold increase from 2019.
Employees in Russia were least likely (16 percent). Rates of observed misconduct were also highest in China (46 percent) and lowest in Germany (20 percent). Retaliation rates are highest in India (90 percent) and lowest in Russia (41 percent). At the same time, however, employees in Russia were least likely to report observed misconduct (64 percent), while employees in India were most likely (97 percent).
All over the world, the three most commonly cited types of retaliatory behavior were being intentionally ignored or treated differently by other employees; being intentionally ignored or treated differently by a supervisor; or being verbally abused by a supervisor or someone else in management.
The ECI noted the strength of an organization’s ethics and compliance culture is critical in reducing misconduct and mitigating wrongdoing. “This includes holding employees accountable for misconduct, taking the time for management to share information on what is going in the organization, ensuring employees trust that leadership will keep their promises and commitments, and making sure that all employees set a good example of ethical workplace behavior,” the organization said.
In thinking about what practical lessons chief ethics and compliance officers should take from the survey results, Pat Harned, CEO of the ECI, offers the following recommendations:
Communicate. “The best starting place is for organizations to open up lines of communication with employees, regularly asking them about the pressures they feel in the workplace. Employees who are feeling pressure to cut corners are likely motivated to relieve that situation, so if asked, they will share information about how the situation can be changed.”
Honestly evaluate business goals and incentives. “Consider whether incentives are generating unintended consequences and adjust them if they are counterproductive. When business goals and incentives are set to a realistic, achievable standard, it can help to ensure that employees are not met with external pressures that might lead to bending the rules.”
Build up ethics and compliance. “Organizations that focus on building effective, high-quality E&C programs see positive ethical outcomes in all areas, including the reduction of pressure felt by employees to bend the rules. It’s not just enough to put an ethics & compliance program in place—the quality of the effort makes a big difference.”
“Now that we might be turning a corner on the pandemic, and especially as organizations negotiate the return to the physical workspace, it is critical that leaders evaluate the effect these changes had on their workplaces,” Harned says. “By embedding proven principles of effective E&C programs, such as those found in ECI’s High-Quality Program Measurement Framework, leaders can build E&C programs that are highly evolved and adaptable, even in unprecedented times.”
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