“Relativity applies to physics, not ethics” – Albert Einstein
Image Courtesy of Nick Youngson (creative commons)
When we embark on collaborative ventures, there are inherent features that drive us towards more ethical behaviours. For example, when we collaborate, we are more likely to empathise with out counterparts, power may be diffused with joint decision-making, and our ways of thinking and doing business may be more diverse. All of these features help us avoid ethical lapses, but we must be alert to some of the risks associated with collaboration. In this blog we explore some of the temptations that can arise in collaborative ventures and offer strategies to ensure all parties work together ethically to achieve enterprise outcomes.
Winning at Any Cost?
In Ron Carucci’s paper, ‘Why Ethical People Make Unethical Choices’, he makes the following observation:
“organizations set themselves up for ethical catastrophes by creating environments in which people feel forced to make choices they could never have imagined.”
The literature is clear that unrealistic goal setting will encourage people to make compromising choices and as Carucci observes, this pushes people to breach ethical standards in two ways. First, they may compromise and cut corners to reach goals and secondly, they will under-report or lie about what progress has actually being achieved. Similarly, if we create a reward system that is too enticing, we can encourage ‘justifed neglect’ whereby the temptation to cheat is too great (especially if the risks of getting caught are low).
When we set up collaborative frameworks, we must be sensitive to setting realistic goals and ensure no one is set up to fail. Similarly, where failures can occur, then we must ensure that the consequences of such failures are not catastrophic. If the cost of failure is too high for an individual, then there is a clear invitation to deceive and mislead. Setting realistic goals will solve one key part of the puzzle to help use drive ethical behaviours but what else can we do to drive an ethical, collaborative culture?
Ethics at the Forefront
If we fail to discuss or place a value on ethical behaviours, then we are less likely to see such ethical behaviours. That is, we must put ethics at the forefront of our ways of doing business. Simply relying on value statements, code of conducts, and the obligatory online, annual ethical training programs though is not enough. Incentivising ethical behaviour is far more effective, as observed by Epley and Kumar:
“It is a boring truism that people do what they’re incentivized to do, meaning that aligning rewards with ethical outcomes is an obvious solution to many ethical problems.”
The challenge of course, it to balance commercial incentives with ethical incentives. An organisation that is haemorrhaging money but is working at the pinnacle of ethical standards would not be a successful organisation. The converse is also true (for example; Enron, Volkswagon, and the News of the World to mention but a few), but we are not faced with a binary choice here. We can be both commercially successful and behave ethically. If we craft our commercial model right, drive the right culture, and ensure leadership is committed then all these elements will self- reinforce to drive us towards a high performing ethical team, delivering enterprise outcomes.
Language and Framing
The language we use and how we frame our agreements is also of paramount importance. If we focus people’s thinking towards enterprise outcomes and not just personal self-interest, then we are less likely to see unethical behaviours. We therefore need to craft out approach to market, commercial agreements, and ways of doing business in terms of joint or collaborative approaches. Language such as “we will work together collaboratively”, or “the team will operate jointly to deliver the joint objectives”. This is in stark contrast to traditional or adversarial contract language such as “the contractor shall…” or “the principal shall…”. Epley and Kumar illustrate the importance of language and framing in the following case study (emphasis added).
“70% of participants playing an economic game with a partner cooperated for mutual gain when it was called the Community Game, but only 30% cooperated when it was called the Wall Street Game. This dramatic effect occurred even though the financial incentives were identical.”
Substance though is far more important than form, hence we must make sure that our actual commercial models and leadership approaches are aligned to our desired collaborative outcomes. This then leads us to a very important aspect of our blog, ‘leadership’. In our previous blog on leadership we observed that leaders set the tone at the top and are instrumental to reinforcing the organisations’ culture (good or bad). No amount of goal alignment, balanced incentive structures, correctly framed collaborative relationships, and well crafted, equitable commercial models will drive ethical behaviours if our leaders are setting a bad example.
Collaboration can inherently reduce some of the risks associated with ethical lapses by incorporating joint decision making, transparency and a culture where everyone is incentivised to achieve mutual, enterprise goals. Nonetheless, we need to be careful we do not set unrealistic targets. More importantly, we must ensure that individuals or teams never face catastrophic consequences where they fail to meet targets or goals. In such circumstances the temptation to cross ethical lines may be too great. Consistent with collaborative contract principles, we should always focus on ‘fixing the problem and not the blame’.
 Nicholas Epley and Amit Kumar ‘How to Design an Ethical Organization: A behavioral approach’ Harvard Business Review (May 2019).