National Business Ethics Survey 2013 Summary - US
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1 INSTITUTE OF BUSINESS ETHICS Natinal Business Ethics Survey 2013 Summary - US Institute f Business Ethics 24 Greencat Place Lndn SW1P 1BE
2 The Natinal Business Ethics Survey f the US wrkfrce is nw in its 19 th year (this is the eighth editin), and has becme the preeminent surce f infrmatin abut wrkplace cnduct and ethics thrugh the eyes f emplyees themselves. Methdlgy Data based n respnses frm 6,420 individuals in the fr-prfit sectr. Participants were: 18 years f age r lder, currently emplyed at least 20 hurs per week fr their primary emplyer; and wrking fr a cmpany that emplys at least tw peple. Randmly selected t be representative f the US ppulatin. Abut ne-quarter f all participants were interviewed by telephne, and abut three-quarters participated thrugh an nline survey. The survey tk place between 30 th September th Nvember Key Findings The amunt f miscnduct declined substantially fr the third straight survey and is nw at the lwest pint since the Ethics Resurce Centre (ERC) began investigating it. The percentage f wrkers wh said they bserved miscnduct n the jb fell t an all-time lw f 41% in 2013 (dwn frm 45% in 2011 and a recrd high f 55% in 2007). Over the last tw years, bserved miscnduct fell in every ne f the 26 specific categries asked abut. Pressure t cmprmise standards, ften a leading indicatr f future miscnduct, als was dwn falling frm 13 % in 2011 t 9% this time. Main cnclusin is that NBES 2013 is telling us that ethics and cmpliance prgrammes wrk In the previus study bth retaliatin against wrkers wh reprted miscnduct and pressure t cmprmise standards were at all-time highs, which strngly suggested that miscnduct was pised t g up. In additin, based n past patterns, the run up in stck price indices ver the past tw years shuld have been accmpanied by a rise in miscnduct. Business rganizatins deep and lng standing investment in E&C is paying dividends and may be fstering a fundamental change in wrker behaviur. While miscnduct verall is n the decline, the nature f these misdeeds is alarming: A strng majrity f miscnduct is attributable t individuals wh hld sme level f management respnsibility wrkers reprted that 60% f miscnduct invlved smene with managerial authrity frm the supervisry level up t tp management. 2
3 Nearly a quarter (24%) f bserved misdeeds invlved senir managers. If allwed t persist, rule-breaking by managers bdes ill fr ethics cultures, because managers set the tne fr everyne else. Wrkers said that 26% f miscnduct is nging within their rganizatin. Abut 12% f wrngding was reprted t take place cmpanywide. The percentage f wrkers wh reprt the miscnduct they bserved has stalled, after cnsistent grwth in the previus three NBES studies mre than ne ut f every three peple wh bserve miscnduct chse nt t reprt. Amng thse wh bserved miscnduct in 2013, 63% reprted what they saw, cmpared t 65% in The rate f retaliatin remains alarmingly high, at 21% virtually unchanged frm a recrd high f 22% in Observed Miscnduct The percentage f cmpanies prviding ethics training rse frm 74% t 81% between 2011 and Tw-thirds f cmpanies (67%) included ethical cnduct as a perfrmance measure in emplyee evaluatins, up frm 60% in Almst three ut f fur cmpanies (74%) cmmunicated internally abut disciplinary actins when wrngding ccurs. The percentage f cmpanies with strng r strng-leaning ethics cultures climbed t 66% in 2013; this is an imprvement cmpared t NBES 2011 (60%) and mirrrs rates in 2009, when cmpanies were still implementing many ethics-related cntrls in rder t weather the recessin. In 2013, ne in five wrkers (20%) reprted seeing miscnduct in cmpanies where cultures are strng cmpared t 88% wh witnessed wrngding in cmpanies with the weakest cultures. Just nine f 28 specific frms f miscnduct we asked abut in NBES 2013 were witnessed by 10% r mre f the emplyees surveyed. Abusive behaviur, which was bserved by 18% f wrkers, headed that list. Lying t emplyees, at 17%, was the secnd mst frequent frm f wrngding. Discriminatin was bserved by 12% f emplyees. Seven percent said they had bserved sexual harassment at wrk. Tw percent stated that they bserved smene ffer a bribe t public fficials. Surveyed emplyees said that members f management are respnsible fr six f every ten instances f miscnduct, and they pinted the finger at senir managers in 24% f bserved rulebreaking. 3
4 Abusive r intimidating behaviur and vilatins f Internet plicy were the frms f miscnduct mst likely t be nging, accrding t 37% and 40%, respectively, f thse wh bserved each. Almst three in ten (29%) f thse wh bserved bribes given t clients said the behaviur was part f an nging pattern and 24% described it as a cmpany-wide practice. Bribery f public fficials was said t be nging by 25% f thse wh were aware f it at their cmpany and 20 percent said it was cmpany-wide. Reprting & Retaliatin When asked why they kept quiet abut miscnduct, mre than nethird (34%) f thse wh declined t reprt said they feared payback frm senir leadership. Thirty percent wrried abut retaliatin frm a supervisr. 24% said their c-wrkers might react against them. Amng thse wh did chse t reprt, thse wh experienced retaliatin in the past were less likely than thse wh did nt experience retaliatin t say they wuld reprt miscnduct the next time they see it. The willingness t reprt in the future was 86% fr victims f retaliatin cmpared t 95% amng thse wh had nt suffered retributin fr past reprting. The data suggest that a reasnable percentage f prblems are being reslved amng emplyees themselves withut the need t kick them up the ladder t management. When asked why they did nt reprt wrngding, mre than ne quarter (28%) f wrkers said they had wrked ut slutins n their wn and 38% said smebdy else had already addressed the issue. Stealing, fr example, was reprted by 64% f thse wh bserved it and six f ten reprted abusive behaviur. By cntrast, accepting imprper gifts r kickbacks frm vendrs was reprted 36% f the time and vilatins f Internet-usage rules generated reprts 37% f the time. Understanding hw & why emplyees reprt In 2013, mre than nine ut f ten (92%) reprters turned t smebdy inside the cmpany when they first cmplained abut miscnduct. Eighty-tw percent reprted t their direct supervisr at sme pint, Mst (52%) said they ultimately wund up talking t higher management abut their cncerns. Htlines and ethics fficers were much further dwn the list. Just nine percent f emplyees reprted prblems t the gvernment. Overall, nly 20% f reprters ever chse t tell smene utside their cmpany, the same percentage as in NBES
5 Mre than 95% f wrkers wh wuld recmmend their cmpany as a place t wrk said they wuld reprt future miscnduct, cmpared t just 64% wh were strngly negative abut recmmending their wrkplace t thers. Seventy-tw percent f wrkers wh said they received psitive feedback frm their supervisr fr ethical cnduct reprted miscnduct when bserved, cmpared t nly 51% f thse wh d nt receive such recgnitin. There is a similar gap in the reprting rates f thse wh are cnfident that tp management is transparent abut critical issues that impact the cmpany (72%) and thse wh are nt (58%). Emplyees wh said that their supervisrs cnduct their persnal life in an ethical manner reprt at a rate f 73%, cmpared t a 51% rate amng emplyees wh are less cnfident abut their direct supervisr s persnal ethical cnduct. Can regulatin affect behaviur? Of thse wh turned utside the cmpany and/r t the federal gvernment with cncerns abut miscnduct, nly 14% said they were mtivated by pssible bunty payments the lwest number amng ten chices in the survey. Emplyees said a desire t prevent harm was a much greater mtivatr than mney. Large numbers said they went utside because they needed utside supprt, the miscnduct was extremely serius, they did nt trust anyne inside the cmpany, they feared retaliatin, r they did nt think internal reprting wuld have an impact. Ding business ethically makes fr better business 5
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