2Sustain

With news of the Madoff scandal dominating the headlines once again, it’s no surprise I’m thinking about ethics today. Remember my post from April, the one in which Ethisphere Magazine showed us that over the past five years, the world’s most ethical corporations have significantly outperformed the S&P 500 in terms of average stock growth percentile? Ethisphere Magazine made a convincing argument that it pays to be ethical, but why is this? Are employees more productive if they’re working for an ethical company? Maybe ethical companies foster greater loyalty?

Data from a survey of more than 15,000 Australian business professionals gives us some insight into these questions and provides valuable information about how employees value the ethics of their employers. The survey was conducted by Beaton Consulting and St. James Ethics Centre, and here are a few of the intriguing findings:

• 89% of survey respondents believe that acting with integrity toward the individuals the organizations serves (clients, stakeholders, etc.) is an ethical obligation for businesses. Less than 1% of individuals believe that business has no ethical obligations, or that legal compliance is the only ethical obligation of businesses.
• 84% believe being responsible environmentally is included in the definition of business ethics.
• 93% of survey participants believe that organizations have an obligation to act ethically even if it occasionally harms their profits.
• 91% agree that all companies should make a formal commitment to acting ethically.
• 80% of those surveyed agree that they are willing to put in extra effort at work if they know that their organization is run ethically.
• 77% agree that if their employer acted in a way that contradicted their core principles, they would definitely leave the organization.
• One in four individuals in the survey believes their employer is not doing enough to promote ethical behavior. Likewise, one in four say they experience people behaving unethically towards one another in their organization.
• And, in contradiction with the overwhelming majority who believe companies have ethical obligations that supersede the bottom line, one in four participants in the survey feel that their organization’s employees would not adhere to the code of ethics if they thought that profits or funding would be harmed.

You can read the full report at http://thehub.ethics.org.au/uploads/files/EMBARGOED BUS ETHICS STUDY WEB.pdf