Jeremy Willinger's blog

Why Your Hiring Process Keeps Missing Candidates' Character Flaws

In a captivating article for Fast Company ES collaborator David Mayer, of the Ross School of Business at the University of Michigan, outlines “Why Your Hiring Process Keeps Missing Candidates' Character Flaws.”

We at Ethical Systems talk a lot about hiring for ethics and culture, as opposed to hiring for skills and personality, during the interview process. The reason is that the dialogue between employer and potential employee is wrought with miscues, overestimations, hyperbole and a reliance on presenting the best possible version of oneself. In addition, research by ES collaborator Nick Epley, and cited in the Fast Company piece, highlights how we are actually less reliable than we may think when it comes to identifying deceits and spotting potential bad apples.

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Crediting the Behavioral Approach

This piece has been cross-posted from the NYU Law Compliance and Enforcement blog.

By: Timothy J. Lindon, Vice President and Chief Compliance Officer at Philip Morris International Inc.

 

The compliance message to companies from Washington is practical and encouraging.  Regulators are not looking to reward check-the-box programs or companies that simply say the right things about integrity in their Codes of Conduct.  They are looking for innovative approaches that work to prevent misconduct in the real world, and can be measured.

The problem of course is identifying and measuring what works.  We have lots of compliance metrics like training completion rates and the number of helpline calls, but none of them measures fully the impact of our programs on ethical decisions by individual employees.  In fact, research shows that many of the activities credited under the federal sentencing guidelines may actually be counter-productive.  For example, training that is regarded by employees as a check-the-box exercise is viewed as insincere and undermines compliance with policies.

So what works?

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New Behavioral Science One Sheets

It is no secret that behavioral science can be chock full of terms that, while widely recognized in our community, may still present some confusion among practitioners. To that end, in partnership with the Notre Dame Center for Ethical Leadership, Ethical Systems has created the first in an ongoing series of downloadable one-sheets designed to demystify and connect behavioral science concepts to daily workflow and organizational cultures across the world. 

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The Scandal Effect: Removing the taint of corporate ethical lapses

Imagine an executive at a company leaves their job in January, six months before the company becomes embroiled in an ethical scandal. The executive now has the taint of a botched job attributed to him/her and, like the smelly car from Seinfeld, it is hard to wash off and seems to follow them everywhere.

A recent article in Harvard Business Review illuminated this phenomenon, shows how much of a long term impact scandal can have on people. The results were shocking (though not so much odiferous).

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Shareholders vs Stakeholders: Who should companies focus on enriching?

When a company has a record year in its stock price, who wins? Frequently it is only a limited number of individuals as opposed to the greater society in which we all live. For public shareholders, a bump in stock price is a good thing but what history shows is that more often than not, the short-term jolts come at the expense of a more sustainable strategy towards success (VW, HSBC and other recent corporate scandals come to mind).

At Ethical Systems, in addition to taking a systems approach to corporate culture and ethics, we advocate for a stakeholder perspective towards business and profits. In contrast to a shareholder focus, which prioritizes the stock price over other factors, concentrating on stakeholders, i.e. those outside of the investor pool, yields a more ethically focused organization where leaders consider actions in the long term. While the latter strategy may forego the highs of the market, it can inoculate against the lows and downturns which can be more debilitating than heights reached at peak economic times.

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By Design: Ethical Systems conference a great success

Ethical Systems, in collaboration with BSPA, held our first conference, Ethics By Design, on June 3. Thanks to the presenters and attendees, it was the behavioral science equivalent of an all-star game attended by the most passionate fans.

Close to 80 leaders from the ethics and compliance space, prominent professors from across the country and influential business leaders and thinkers came together to learn from what one participant called “a massive amount of brain power in the room.” And truly, it was. From those who wrote the seminal texts on business ethics to the people in charge of designing ethics programs at top companies, the attendee mix was evenly distributed among both academics and practitioners in order to stimulate dialog, research and connections.

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​​​​​​​Featured Collaborators for June: Ethics By Design Speakers

Each month, Ethical Systems publishes an interview with one of our esteemed collaborators covering their research and work in an area relating to ethics and ethical systems design.

For June, however, we decided to upend that tradition and focus on the wealth of expertise at our conference on June 3rd. Truly, it would not be an Ethical Systems event without a leading group of academics and practitioners exchanging resources and strategies around strengthening the ethical climate and culture of today's business world.

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Never Black and White: Eugene Soltes Exposes the Gray

White collar criminals typically conjure images of dark boardrooms, wealthy conspirators and syndicated, international crime rings. Yet, in a new book, Eugene Soltes shows white collar crime is less a cause of pernicious plots and more a product of a lack of focus, proximity and context.

What distinguishes Why They Do It from others on the subject is Soltes’ extensive use of almost 50 interviews with those convicted of white collar crimes- which he defines as individuals in high social standing who committed crimes while doing business. The main takeaway is that corporate leaders are more or less normal people, who are as susceptible to the same conflicts of interest and ability to rationalize decisions made in the moment as the rest of us. By virtue of their position, however, their decisions can do harm not only to themselves but also all with whom they do business.

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Twice as Nice: On ethics teaching

Can people be taught to be more ethical? While some may say teaching ethics is a recipe for continued headaches and an ongoing, almost Sisyphus-like journey to ensure lessons are absorbed, a new study has positive implications for both academics and practitioners who have dedicated their work to engaging others in ethics education, training and programs.

The as yet unpublished study, covered by Ben DiPietro in The Wall Street Journal’s “Morning Risk Report” and presented at the recent Academy of Management conference, spotlights a key training tactic that will greatly increase ethics knowledge retention and, in the long term, may possibly reduce misconduct.

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Lapsed Priorities: New Survey reveals lack of focus on bribery and corruption

If the following survey results are any indication, a betting man would be doubling down on increased FCPA cases in 2016.

The study by international law firm Hogan Lovells and reported in the International Business Times highlights that, for over half of multinational companies, fighting bribery and corruption does not feature as a main priority.

The piece reveals that old habits die hard. A focus on short term sales goals, making deadlines/sales quotas and operating in areas where bribery runs rampant contribute to a casual attitude towards maintaining ethical behavior and staying true to internal values and external regulations.

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