Ethikos Volume 36, Number 3. July 02, 2022

AT: Everyone is for integrity, at least in the abstract. The hard part is when it’s difficult and acting with integrity could cost us. How do we get individuals to act with integrity even when it’s difficult?

RC: Silence and ambiguity are the enemies of integrity. If you work at an organization that never talks about integrity, or speaks only in generalities (e.g., a pretty poster on the wall or a “Do the Right Thing” slogan), then you’ll constantly find yourself in situations where there’s nothing to guide your thinking other than your own self-interest. Companies that want integrity in their culture have to intentionally create an environment where doing the right thing is talked about and defined. Leaders buy into it and demonstrate integrity in what they do, and that inspires the whole company.

AT: What about organizations and getting them to act with intentional integrity? I know that they are made up of individuals, but in many ways, organizations are distinct entities of their own, where collective decisions lead to one organizational decision that may be horrendously bad. How do we control for that?

RC: Leadership. I think integrity comes from the top—leaders have an outsized influence here. I often see poor “collective decisions” as being inspired by a poor tone from the top, as everyone collaborates in an effort to rationalize actions that will please leadership. When leaders send the right message to teams, the decisions those teams make will be more ethically sound.

AT: One of the greatest acts of integrity is being a whistleblower, whether anonymous or not. And most everyone celebrates whistleblowers, unless of course you work with them. We all can think about numerous whistleblowers who were vilified, but it’s impossible to think of one that a company lauded. To me, that illustrates the limits of our embrace of integrity. Am I being too hard, and is there a way to overcome that? It seems to me that one of the things wired into our brain is this tension between acting with integrity and loyalty to the group.

RC: Well, a whistleblower is a sign that the other channels failed. Every day, people at companies have the courage to raise their hand to express concerns, and problems get resolved. We only hear about whistleblowers when problems are ignored, no one is acting, and someone has to become a whistleblower. So many whistleblowers try, and fail, to get the company’s attention on an issue first, before going public. If a company creates a culture where raising your hand and calling attention to problems is valued, then there’s no need to take the more drastic whistleblower actions (like going to a regulator or the press). We have to eliminate the tension between loyalty to the group and integrity; the two concepts should be aligned. Raising your hand to talk about integrity is, in fact, an act of courage that demonstrates loyalty to the larger group.

AT: Is integrity something that’s global or culturally specific? I imagine that every culture in the world has a concept of integrity. But does the understanding of integrity change from culture to culture, and how can a global company navigate those divides and potential differences?

RC: There are some basics (e.g., the opposition to lying, cheating, and stealing) that are fundamental to any culture. But you’re right, integrity can often be gray, and one’s culture, life experiences, and religion can all influence how one views an integrity issue. I’d look at it this way: Companies need diversity to be successful, but companies also need a unifying purpose, a culture that everyone within the company understands and lives by. Like in society, you might not agree with the nuance of every rule, but you understand there are certain things you have to live with for the common good. These common understandings are a lot more powerful if everyone has a voice in creating them and if they are enforced fairly. With a little thought, you can navigate this.

AT:You observe that integrity means following both the letter and spirit of the law, which sounds like it would be hard to argue, but it isn’t, with many saying we need to follow just the words of the law. Given that this is far from a settled debate, why should organizations live up to the spirit and not just the letter of the law?

RC: Law always trails innovation. Government moves slowly, business moves fast. The world can’t constantly be chasing business, and businesses needs to be accountable for their actions. The recent Rio Tinto debacle is a great example of how the world will hold companies accountable for bad behavior, even if it’s technically legal.^[1]

AT: In China, they have been developing a social scoring scheme. For most of us in the West it sounds troubling, but it could be seen as a means to promote integrity. What’s the limit for promoting integrity?

RC: I think there’s a difference between societies where the government or religious organizations define integrity as a tool of control and societies where the people themselves establish the norms for acting with integrity based on a sense of what’s right and wrong. I’m more a fan of the latter.

AT: We see something like it in the online world. Through feedback we know more about a seller on eBay or a rental on Airbnb than we do about a store down the street. Without the embrace of ratings, I wonder if e-commerce would have survived. Or am I overstating the case?

RC: I think that online platforms are in the trust business—that’s a big part of their value proposition. Platforms are a critical intermediary operating trust processes like reviews, insurance, buyer protection, dispute resolution, and the like. I don’t think you’re overstating things to say that without these independent trust processes, e-commerce would have really struggled to get off the ground. E-commerce, even more than brick and mortar commerce, needs trust and order to operate effectively.

AT: I do wonder though if in some way we’ve gone a bit too far with a demand for us to rate everyone and everything. I bought one of my kids a three-ring binder, and the store wanted me to rate it. I mean, it had three rings. They opened and closed. What more is there to say? Are there limits in terms of how far we should go? Do we risk taking this too far?

RC: Ha! I’ve bought some miserable binders that fall apart in a few weeks, with papers falling out everywhere. I love the concept of accountability and feedback. If it’s obvious, and no one rates a screwdriver because, hey, it’s a screwdriver, that’s fine. Businesses should always want feedback, and the fact that you can rate everything is healthy. But maybe businesses could be a little less aggressive in badgering us for the feedback.

AT: An increasingly challenging issue for companies is how to approach social issues such as Black Lives Matter. Most companies have a set of core values, and many will say, “If we value X, then we need to take a stand on Y.” Others argue that no, that value is about how we act internally in our behavior; it doesn’t mean we should become a public advocate for that value. Where do you stand on the issue?

RC: I don’t think you have a choice anymore. The world wants to know where you stand on important issues, at least those that have a reasonable connection to your mission. It matters to employees, customers, communities, and governments. If you don’t speak up about something like Black Lives Matter, the world will assume (rightly or wrongly) that you don’t care about it or that you support the status quo. So leaders have to get comfortable with the uncomfortable task of talking about tough, controversial subjects. Now, that doesn’t mean you have to talk about every controversial subject; you have to carefully define your mission and understand what’s relevant to that mission and what’s not.

AT: Consequences are important, as you argue in your book, but one thing that has troubled me is the embrace of zero-tolerance policies. They’ve evolved into death-penalty policies in our society. To me there is a difference between not tolerating the behavior and disciplining vs. not tolerating and expelling. What’s the right amount of consequences? Is firing the only good solution? I wonder especially for junior people who have stepped over the line whether it would be better to discipline and keep them on since they can serve as an ongoing lesson to others that there are consequences but that the company isn’t draconian in its approach, which would likely encourage more people to potentially self-report violations.

RC: I spend some time on this subject in my book. I think people expect a former prosecutor to really bring down the hammer when someone screws up, but I think being a prosecutor helped to teach me empathy and the importance of being measured when you have authority. I often cringe when I hear leaders talk about having zero tolerance for something; it doesn’t reflect the reality of a world that often demands nuance. It’s a great public relations phrase, designed to tell the world that no one is tougher than you are on whatever subject you’re being attacked on. Sure, some workplace violations should lead to a firing, and I’ve been involved in a number of them. And you need to be consistent. But if you want people to report violations, they need to trust that the company is going to be fair and do the right thing with the information. If employees know that the response is likely to be draconian, they don’t want to report it. Some mistakes are good teaching moments.

AT: Codes of ethics are critically important, and the values in them have to reflect the companies’ true values, but one of our guests in a recent podcast made an interesting observation: the words tend to be kind of generic and applicable to any organization. How do you make them truly your organization’s values?

RC: The words are often that way because they weren’t actually created by the organization. Too often these codes are something that your law firm sends you, and you just email it around and tell everyone to check a box to acknowledge receipt (in case you need to fire them for violating it). Or worse, a human resources professional just went online and copied the code from another company, substituting your company’s name at the top. Sometimes it feels like one lawyer wrote a code of ethics, and everyone has been copying it and using it ever since! If you want it to sound different, get a diverse group within your company and write one yourself, using your own company’s values and language.

AT: I really like your emphasis on there being a constant drumbeat. Dan Ariely has pointed out that moral reminders are very effective but don’t last very long.^[2] The more we can remind people, the better, but we’re competing for time with other corporate initiatives and, of course, the need to get the work done. How can compliance teams, to perhaps stretch the metaphor a bit, turn the drumbeat into a backbeat for the organization?

RC: Great job with that metaphor. A constant drumbeat is important, but if it’s a monotonous beat, pretty soon it lulls people to sleep. Deliver messages through different mediums. What matters most, I think, is to get leaders involved. If a leader is willing to address integrity directly, in a human and unscripted way, for just one or two minutes at a time, you don’t need to overdo it. Plan ways that leaders can talk about some aspect of integrity that they’ve had experience with and have some passion around. As long as the talk is reinforced with processes that leaders support and follow, you don’t have to talk about it every week.

AT: As we discuss these issues in the abstract, I think it’s good to remind people that you worked as a frontline compliance and ethics officer and have had a long career in business. What’s the greatest integrity challenge you personally faced?

RC: I think it was in the early days of eBay when we were trying to figure out what to sell and what to ban from the marketplace. The right thing wasn’t always clear. Do you ban guns? Pornography? Kidneys? Breast milk? I recall struggling with offensive items—I was concerned that what was “offensive” really depended on your perspective, and I was cautious about making value judgments that would entangle us in banning too many items. I remember that one user took communion from the Pope, but instead of eating the wafer, he pocketed it and put it on eBay. It didn’t bother me at all: I’m not Catholic and I was inclined to let him sell it. But I remember talking to a number of eBay employees who were deeply offended by it. And the Catholic Church came out strongly against it. I gradually came around to the belief that you have to stand for something. Trying to serve everyone by not taking a position doesn’t work very well.

AT: Finally, what’s next for integrity? It’s an eternal value in many ways, but the definition of what an act of integrity is does change over time as we raise the ethical bar. What do you think will be the next expectation for integrity?

RC: I think that we’re going to start expecting it more from others. Capitalism, I think, needs to evolve to expect companies to step up and be responsible citizens, rather than just accepting some idea that anything goes as long as it’s good for shareholders. That involves real changes in behavior from leadership, from the way that decisions are made to the way leaders are compensated, and will require a lot of alignment with investors, employees, and other stakeholders, but as the world gets more and more connected, this movement is inevitable.

AT: Thank you, Rob!