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Talk about workplace ethics and eyes begin to glaze, yawns must be stifled and brows start to furrow. Why is this so? Conventional wisdom sees workplace ethics as an occasional dilemma to be tolerated, not a daily focus to be embraced. Conventional wisdom is wrong. Just like an airplane that crashes when its structural integrity fails, a business will crash when its integrity fails. Unfailing adherence to business ethics, just like performing aircraft maintenance, can keep you aloft. In-house counsel are increasingly being called upon to counsel, guide and even be arbiters of workplace ethics. This responsibility is especially nettlesome because in-house counsel must address the needs of several constituencies — employees, owners, shareholders, executives, the public and the press. Here is a framework to help you balance these often competing needs, especially when the lines between right and wrong bleed together. It’s based on three “Home Bases Rules.” Here’s Home Base Rule No. 1: When managers make it about themselves, not the company, business integrity fails. And this happens in three scenarios: inartful avoidance, the Narcissus syndrome and the consensus complex. Let’s look at the first. Managers refusing to make decisions, or needlessly delaying decision making, create stressors on business integrity. Inartful Avoidance: Consider the 1990 case Vaughn v. Texaco Inc. A black employee allegedly was under-performing, according to the 5th Circuit opinion. Because she was admired by other black employees and an advocate for their concerns, her managers avoided dealing with her shortcomings, preferring to “keep the peace,” according to the opinion. When business conditions compelled a reduction in force, she was selected; she sued for race discrimination. The 5th Circuit said she gets a jury because race played a role in the managers’ decision to duck their responsibilities to give fair warning about her performance deficiencies. After all, if she was counseled, she may have improved and avoided termination, according to the opinion. It seems the managers put their needs (avoiding an unpleasant situation) ahead of the company’s and the employee’s. Note: Even if the decision was made for nonracial reasons, the integrity of the business is still undermined. Any “me first” decisions by managers will do that. Narcissus Syndrome: In Greek mythology, Narcissus saw his reflection in a pool, fell in love with himself and was doomed. We see this in the workplace, with managers favoring — either in hiring, promoting or firing — those with similar life experiences. Here are some danger signs: myopically focusing on an employee under investigation for wrongdoing without looking at all contextual facts; laying all blame for a workplace issue on a particular employee without considering the culpability of others; and having good interviews only with those applicants that are like themselves. Again, it’s managers making it about themselves. Here is a fundamental truth: None of us — not a one — is as fair as we imagine ourselves to be. This is not bad; it’s human. So, think about recusing managers from decisions where they may be a little too close; it’s not an abdication of responsibility by them, it’s embracing it or simply being more sensitive to this issue and weighing it accordingly in decision making. Consensus Complex: Finally, beware of the consensus complex. If a manager waits until every single fact is in, and every single person is on board, then the decision may not be second-guessed, but it also never may be made. Decisions unnecessarily delayed stress the integrity of the business. By waiting, the manager again puts his needs before those of the company and its employees, makes the decision about him, not them. The bottom line on all these scenarios is this: In-house counsel need to help managers look outside their needs, focus on the needs of the company and empathize with those of others, including employees. ACTIONS OF MANAGEMENT How does a company go about instilling ethics into everyday operations? One way is by example, which is Home Base Rule No. 2. In a recent survey by KMPG, 80 percent of employees who felt that top management would uphold ethical standards would recommend their company to recruits. But what happens when employees perceive management as taking an ostrichlike attitude of self-delusion? The percentage nosedives to 21 percent, and the percentage of those believing current customers would recommend their company to others tumbles from 80 percent to 40 percent. Too often managers think a corporate ethics policy is the start and end of a commitment to business integrity. It isn’t. The company’s employees, its most valuable asset, look beyond the written policy to the actions of management. While ethics policies are helpful, there’s no comparable impact to executives putting themselves on the line. It’s like a ham and eggs breakfast; the chicken is involved, but the pig is committed. Same here. Executives need to lead by example, taking stands on issues impacting business integrity. When ethical standards are embraced at the top, they’re embraced down the line. Once there’s commitment from the top, there are various models to help in making decisions consistent with business integrity. That’s Home Base No. 3. While some sound enticing, they aren’t all helpful. One is the “Can I sleep at night?” test. That’s not much help; after all, executives lie awake at night precisely because they have done the right thing and because they understand their decisions impact lives, with real, not theoretical consequences. Similarly, the “look in the mirror” test requires you to ask yourself, “What kind of person do I want to see when I look in the mirror in the morning?” Our take is the same as journalist H.L. Mencken’s: “For every complex problem there is a solution that is simple, neat and wrong.” Here are three models that work because, as in Home Base No. 1, they force us to look at constituencies and effects outside of ourselves. First model: Norman Augustine, Lockheed Martin’s former CEO, is quoted in Jeffrey Seglin’s book, “The Good, The Bad and Your Business,” as saying there are four questions that must be asked before making a decision: Is it legal? If someone else did it to you, would you think it was fair? Would you be OK with the decision if it appeared on the front page of your hometown newspaper? Would you like your mother to see you do it? The second model is a little less overarching for those close to the front lines who are charged with implementing decisions: Have we accurately figured out the issues at hand? What is the purpose and intention of our decision? What are the effects on others — our shareholders, our employees, the public and other companies? Will it be a valid decision over time, or are we deciding based on a short time frame or expediency? Are we omitting contradictory facts from our analysis for convenience’s sake or to bolster the favored decision? Could you tell your decision without qualms to your boss, your CEO, the board of directors, your significant other? That model looks to the needs of others and examines the motives of decision makers, who — like everyone — can fall into the trap of confirmation bias (looking only to facts supporting their view and ignoring or minimizing contradicting facts). It reminds decision makers of Ben Franklin’s wise admonition: “Half the truth is often a great lie.” The third model is “knowledge and control.” What do we mean? Ask yourselves these questions: Are we telling our employees about what the company is up to and what we expect of them, and are we investing them with the tools to act on the knowledge? For instance, don’t just let employees know business is off without also giving them opportunities to develop new skill sets to avoid being caught up in a reduction in force. Similarly, don’t simply parade out your company’s ethics policy without also providing a way to register concerns about it effectively. The knowledge and control model comports with business integrity and provides ammunition for you in an employee suit. When a jury sizes you up, they will think to themselves: “If I worked at this company is this the way I would want to be treated?” “Even if I don’t agree with their decision, was it made conscientiously?” “Would I feel safe if I worked here?” DRINK UP Because the duties of in-house counsel are so intertwined with a company’s operations, you can find yourself constantly faced with business integrity issues. By applying these Home Base Rules, you can successfully address issues of right and wrong, and you stay aloft. The framework also helps in five other ways. First, by phrasing the matter as one of business integrity, it’s easier to discuss. Once you start talking about ethics and morality, the discussion slips into argument, with managers becoming defensive. Framing the issue matters just as much as the issue itself. Second, in-house counsel don’t necessarily want all workplace integrity issues coming across their desks. If it’s happening, it may be a sign of managers abdicating their responsibilities to make the tough decisions. As ethics guru Seglin notes in his book “The Good, The Bad and Your Business, “[A]bstaining from responsibility for making tough choices using the fear of litigation as a crutch is no real solution since we end up making decisions that might indeed have good outcomes (or might have bad ones) without really knowing why we made this decision other than the fact that someone somewhere decided that that’s the way it’s done to avoid exposure.” A way to deal with this situation is to ask managers this: “If there were no laws dealing with employment, what decision would you make regarding this employee?” Then, train the manager to consider the issues raised in the integrity models above, so that the manager can confidently make decisions. Third, the Home Base Rules help in-house counsel to get their various constituencies to “think gray.” Not all answers — as much as we may wish — are black and white. The most important part of helping others “think gray” is to give them time to reflect on a decision. A useful question to ask of a decision maker is this: “If you had 10 times as much time to make this decision, would you recommend the same thing?” If the answer is “no,” step back and ask “why not?” Fourth, this overview immunizes in-house counsel from simplistic advice, which is especially important to avoid when dealing with employment issues. We run across slogans all the time — “no good deed goes unpunished” and “character is what you do when no one is watching” are two on our “10 most wanted list.” While they embody the virtue of simplicity, they are skin-deep; and, like most topical solutions, they provide short-term relief, but long-term indigestion. Finally, thinking about issues of business integrity prepares you for the toughest day of your professional life. We hope it doesn’t come but chances are it will. It’s the day when you’ll be sitting around the conference room table, and you’ll have to look operations in the eye — or maybe the boss — and say, “Yes, we must” or “No, we can’t.” You may want this cup to pass from you. It won’t. All lawyers must “sooner or later” drink from it.

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