It’s not just survival that businesses have to deal with as they grapple with fallout from the global coronavirus pandemic. New research reveals Covid-19 could prompt a surge in misconduct and behaviour that compromises their organisations’ ethical standards.
That’s the warning this week from the Ethics & Compliance Initiative (ECI), a US think tank examining ethics in the workplace. The organisation’s Global Business Ethics Survey finds that as change events inside companies and organisations increase so too does the possibility of ethical transgression. Although ECI’s survey looks at 2019 and does not address Covid-19, its report speculates that the virus may prompt an epidemic of bad behaviour.
Covid-19, ECI says, has triggered “extraordinary” challenges in workplaces across the globe. That will be assessed in next year’s research.
“In the meantime, we can reasonably surmise that the organisational changes resulting from Covid-19 might lead to increased pressure on employees to compromise their organisations’ ethics standards,” it warns.
After questioning employees around the world ECI finds that 75% of those in organisations who have experienced four to seven changes during the year had witnessed misconduct. That is more than double the number, 33%, who had seen misconduct in companies where there were no changes.
The data will give company leaders significant pause for thought as they instigate strategic change in response to the Covid-19 crisis. When Board Agenda polled board members earlier this year, 60% said their companies had been forced to review strategy, while 43% said the pandemic represented a “fundamental threat”. Research by Will Harvey and Navdeep Arora at the University of Exeter Business School has also shown how multiple pressures can make professional misconduct more likely.
ECI has revealed other startling findings. One fifth, 22%, of employees globally say they experience pressure to bend their company rules. There are regional differences, however. South America tops the polls with 37%, while North America is a close second at 31%. In Europe the rate is 23%, just above the global median.
ECI is able to shed some light on the kind of wrongdoing routinely seen. The most likely are intentional “conflicts of interest”, with 55% of employees coming across those, followed with almost the same number, 52%, witnessing “abusive behaviour” that creates a “hostile work environment”. A disturbing amount—30%—said they had observed examples of sexual harassment.
However, the third largest form of transgression are violations of health and safety regulation at 45%—a fact sure to send a shudder down the spines of managers in industries around the world.
But what are the underlying factors? ECI says its leadership. Employees are more likely—at 49%—to see poor behaviour in organisations with “weak leader commitment” to ethical values. Only 13% of employees in companies with strong leadership commitment to rules and values had witnessed problems.
“When employees perceive that leaders are committed to organisational values and ethical leadership, the tone is set for all employees to follow.
“Leadership’s lack of commitment to organisational values and ethical leadership may be a signals to employees that they are not expected to adhere to the values of the organisation or to model ethical behaviour,” the ECI report says.
That said, the report says it is top management that are most likely to experience pressure to turn their backs on the rules. The solution is better training for leaders in how to send a message that ethics are important to their employees. It’s even more critical that organisations have “strong direct supervisor leadership”.
“It is important to note that with the growing size of organisations, direct supervisors are often the only members of the management team that employees interact with on a regular basis.”