Transcript Payroll/Personnel System Security Awareness Training

Ethics
Western Region CSREES
Administrative Officers Meeting
John W. Gregg
Director of Controls & Accountability
UC Davis
Materials used with permission from
Josephson Institute of Ethics
www.josephsoninstitute.org
Training Goals

How ethics help you in
your job!
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Ethics Definition
Ethical Principles
Ethical Decision-Making
Ethics Program
Advantages
Challenges
Scenarios throughout
this presentation
Values
Important Beliefs and Desires
Motivate Actions
Shape Attitudes
© 2000 Josephson Institute
Values Different Than Ethics
Values
All important beliefs (e.g., health, wealth)
Ethics
Beliefs about moral right and wrong
(e.g., trustworthiness, respect)
© 2000 Josephson Institute
Ethics
 Moral
Trustworthiness
Respect
Responsibility
Fairness
Caring
Citizenship
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Principles
of duties and virtue
prescribe how we
should behave
© 2000 Josephson Institute
Six Pillars of Character
Trustworthiness
Responsibility
Caring
Respect
Fairness
Citizenship
© 2000 Josephson Institute
Five Principles of
Public Service Ethics
 Public
Interest – advance public, not personal
interests
 Objective
Judgment – Decisions on merits, free
of partiality, prejudice and conflict of interest
 Accountability
– conduct business openly,
efficiently, equitably, honorably
 Democracy
– Honor and respect democratic
principles; observe the letter and spirit of laws
 Respectability
– Safeguard public confidence by
avoiding appearances of impropriety and misconduct
A
© 2000 Josephson Institute
Ethics is not about words!
It’s about actions!
It’s not simply a
written code or
framed credo
It’s not about
what we say
or intend
© 2000 Josephson Institute
Perception is Reality
When it comes to trust,
perception is reality.
It is not enough that we do no wrong,
we must also try to assure that others
believe we have done no wrong.
© 2000 Josephson Institute
Ethics Transcends the Law
There is a big
difference between
what you have a
right to do and
what is right to do.
Rights
© 2000 Josephson Institute
Most of the time, we know
what we should do.
The real test of ethics and
character is whether we
are willing to do the right
thing
… even when it is likely
to cost more than we
want to pay.
B
© 2000 Josephson Institute
The Ethical Landscape
Post Enron Environment
Intensified Scrutiny
Public Cynicism
Prosecution
Burdensome Regulation
Broader Accountability
Turned Our World Upside Down!
© 2000 Josephson Institute
Sarbanes-Oxley, NYSE rules and SEC
regulations impose new requirements
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Certification by CEO and CFO of financial
statements.
New attorney reporting responsibilities.
Comprehensive audit committee responsibilities.
“Real time” continuous reporting of material events.
Prohibition of loans to top executives.
Requirement that accounting firms avoid certain
conflicts of interest.
Documentation retention requirements.
Codes of ethics/standards of conduct.
Majority of independent directors.
© 2000 Josephson Institute
It’s Not Over Yet
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California adopts Nation’s first ‘Mini-SarbanesOxley Act’ for non-profits
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Taxation of Exempts, May/June 2005
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In May 2003, FBI indicated it is opening an
additional three to five investigations a month of
suspected fraud of $100 million or more
 In all, the US Dept of Justice is conducting about
200 ongoing investigations, about 10 times the
caseload before Enron
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C
Boston Globe, 5/6/2003
© 2000 Josephson Institute
Public trust
… is merely a state of mind
In cynical times, it is difficult to create and
easy to destroy
© 2000 Josephson Institute
Youth & The Job Pool
“An increasing number of young people are
growing up without a firm understanding of or
commitment to the core ethical values needed to
inform and energize the conscience.”
“As a result, they lack internal mechanisms to help
them know right from wrong and to generate the
will power to exercise self-control and
consistently do what is right.”
- Michael Josephson
© 2000 Josephson Institute
Job Pool - Cheating
 In
2002, 74% of high school students
surveyed admitted they cheated on an
exam within the past year.
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 In
48% cheated 2 or more times
78% of varsity athletes cheated
1992, 61% admitted cheating
• Josephson Institute, 2002
D
© 2000 Josephson Institute
Job Pool - Theft
 In
2002, 38% of high school students
surveyed admitted they stole from a store
within the past year.
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Stole 2 or more times: 19%
Males 41%; Females 35%
In 1992, 33% admitted shoplifting
 In
2002, 28% said they stole from a parent
or other relative
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In 1992, it was 24%
© 2000 Josephson Institute
Job Pool - Lying
 In
2002, 37% said they would be willing to
lie to get a good job
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46% said they sometimes lie to save money
43% agree “a person has to lie or cheat
sometimes in order to succeed”
• Josephson Institute, 2002
© 2000 Josephson Institute
Job Pool – “Book Cooking”
 More
than three-quarters (76%) of grad
students in business say they would
misrepresent write-offs to enhance profit
reports
 Nearly half of all CEOs (47%) and 41% of
corporate controllers were also willing to
cook the books
• Journal of Business Ethics, Feb. 1996
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© 2000 Josephson Institute
Ethics in Recruitment - Example
Exec. Director and COO, Josephson Institute of Ethics
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Position
“…assure that JI complies with all legal requirements and the highest
ethical standards.”
“… assure that all … functions of the organization are performed at
the highest level of proficiency and with complete integrity.”
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Candidate
“Be a person of exemplary character who cares about and is deeply
committed to JI’s mission.”
“Have strong personal character and credibility.”
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Application Process
“Includes a statement that you understand that character is of the
utmost importance to this position.”
© 2000 Josephson Institute
Ethical Decision-Making
Using Your Moral Compass
The Golden Rule
Confucius: What you do not want done to yourself, do not
do unto others.
Aristotle: We should behave to others as we wish others to
behave to us.
Judaism: What you dislike for yourself, do not do to
anyone.
Hinduism: Do nothing to thy neighbor which thou
wouldst not have him do to thee thereafter.
Islam: No one of you is a believer unless he loves for his
brother what he loves for himself.
Buddhism: Hurt not others with that which pains thyself.
Christianity: Do unto others as you would have them do
unto you.
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© 2000 Josephson Institute
Bell, Book & Candle Test
Listen for the bells warning
you of an ethical issue.
Check to see if there are any
laws, regulations or rules
which restrict your choices.
How will your decision look in the
light? Could a reasonable fairminded person conclude you acted
improperly?
© 2000 Josephson Institute
Developing a Comprehensive
Ethics Program
Advantages of Ethics
 Competitive
Edge – people prefer to work with
those they can trust
 Credibility – people believe you
 Efficiency – trust makes decision making faster and
more economical
 Morale – people feel better about their jobs and
themselves
 Loyalty – internal and external
 Personal
Satisfaction – self respect, affection
of others
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© 2000 Josephson Institute
Characteristics of an Effective
Ethics Program
 Purposeful – articulate objectives and influence
values and behavior
 Pervasive – Six Pillars should pervade all aspects
 Repetitive – frequent messages about the meaning
and importance of the Six Pillars
 Consistent – attitudes, words and actions
consistently support the Six Pillars
 Concrete –values expressed in context of
concrete, realistic, relevant situations
 Challenging – challenge institutional
obstacles and individual rationalizations
© 2000 Josephson Institute
Realistic Goals of an Ethics
Program
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Criminal Conduct – It won’t make crooks honest but
it can create an environment where criminal conduct is
less likely and more risky.
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Improper Conduct – It can provide knowledge and
promote systems that significantly reduce a large
category of improprieties.
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Poor Judgment – It can create a heightened
understanding of the kinks of conduct that generate
criticism and accusations of unethical conduct.
© 2000 Josephson Institute
Cost of Not Doing the Right Thing
Examples of Research Noncompliance in Higher Education
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University of Alabama (2005)
Mayo Foundation (2005)
 Univ. of Pennsylvania Children’s
National Medical Center (2005)
 East Carolina University (2004)
 Harvard/Beth Israel Deaconess
Medical Center (2004)
 Johns Hopkins Univ (2004)
 Northwestern University (2003)
 Thomas Jefferson Univ (2000)
 University of Pittsburg (1999)
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$ 3.4M
$ 6.5M
$ 1.3M
$ 2.3M
$ 3.3M
$ 2.6M
$ 5.5M
$ 2.6M
$15.5M
$43.0M
Developing a Comprehensive
Ethics Program – 11 Steps
1.
2.
3.
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6.
Diagnosis
Strategy
Development
Standards of
Conduct
Recruiting & Hiring
Education & Training
Performance
Reviews
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8.
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11.
Support Systems
Dissent / Reporting
Channel
Monitoring
Compliance
Continuous Training
Communication
© 2000 Josephson Institute
Challenges to an Ethics Program
Increasing Ethical Conduct in
Organizations – Institutional Factors
 Culture
and Tradition
 Organizational Self-identity
 Leadership’s Values
 Hiring and Training
 Compensation and Incentives
 Approval and Disapproval
 Business Plan Objectives
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© 2000 Josephson Institute
What is Work Culture?
Shared History
Expectations
Unwritten Rules
Social Mores
Underlying beliefs
color perceptions
of actions and
communications
“200 years of tradition,
unimpeded by progress!”
Department of Defense
Factors Influencing Individual Values
 Upbringing
(family values, religion, culture)
 Self-Conception
 Motivations
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Need for Approval
Need for Security
Need for Money or Position
 Ethical
Consciousness/Awareness
 Moral Courage/Strength of Character
J
© 2000 Josephson Institute
Enemies of Integrity
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Complacency
 Self Delusion
 Rationalizations
 Survival Syndrome
 Win-at-Any-Cost
 Misplaced Loyalty
 Undervaluing Integrity
 Unaccountability
 Short-Term Thinking
 Arrogance of Power
© 2000 Josephson Institute
The T.E.A.M. Strategy
Teach
Enforce
Advocate
Model
K
ETW – Public Service Ethics
© 2004 Josephson Institute
Tone from the Top
“People behave in an unethical
way because they are either
responding to signals sent by
top management or because
the only way that they can
meet expectations is to cheat.”
- James O’Toole, USC Graduate School of Business
© 2000 Josephson Institute
When you decide to fight
fire with fire ...
… all you get is the
ashes of your own
integrity.
— Michael
Josephson
© 2000 Josephson Institute
The Rat Race
The problem
with the rat race
is that even if
you win, you’re
still a rat.
—Lily Tomlin
© 2000 Josephson Institute