Assignemnt:
Why Do Some Managers Cheat?
Moral Development
Scholars argue that some individuals are better prepared to make ethical judgments than others. Psychologist Lawrence Kohlberg built and empirically tested a comprehensive theory of moral development in which he claimed that moral judgment evolves and improves primarily as a function of age and education. Kohlberg, via interviews with children as they aged, was able to identify moral development as movement through distinct stages, with the later stages being improvements on the earlier ones. Kohlberg identified six universal stages grouped into three levels:
1. Preconventional level:
Stage 1: Obey rules to avoid punishment.
Stage 2: Follow rules only if it is in own interest, but let others do the same. Conform to secure rewards.
2. Conventional level:
Stage 3: Conform to meet the expectations of others. Please others. Adhere to stereotypical images.
Stage 4: Doing right is one's duty. Obey the law. Uphold the social order.
3. Postconventional or principled level:
Stage 5: Current laws and values are relative. Laws and duty are obeyed on rational calculations to serve the greatest number.
Stage 6: Follow self-chosen universal ethical principles. In the event of conflicts, principles override laws.
At Level 3 the individual is able to reach independent moral judgments that may or may not conform with conventional societal wisdom. Thus the Level 2 manager might refrain from sexual harassment because it constitutes a violation of company policy and the law. A manager at Level 3 might reach the same conclusion, but his or her decision would be based on independently defined universal principles of justice. Kohlberg found that many adults never pass beyond Level.
2. Consequently, if Kohlberg was correct, many managers may behave unethically simply because they have not reached the upper stages of moral maturity. Kohlberg's model is based on extensive longitudinal and cross-cultural studies over more than three decades.
For example, one set of Chicago-area boys was interviewed at 3-year intervals for 20 years. Thus the stages of moral growth exhibit "definite empirical characteristics" such that Kohlberg was able to claim that his model had been scientifically validated. Although many critics remain, the evidence, in sum, supports Kohlberg's general proposition. [For a link to an overview of moral development and moral education, see https://www.davidsongifted.org/db/Resources_id_11335.aspx]
Feminine Voice One of those lines of criticism requires a brief inspection. Kohlberg colleague Carol Gilligan contends that our conceptions of morality are, in substantial part, gender-based. She claims that men typically approach morality as a function of justice, impartiality, and rights (the ethic of justice), whereas women are more likely to build a morality based on care, support, and responsiveness (the ethic of care). Men, she says, tend to take an impersonal, universal view of morality as contrasted with the feminine "voice" that rises more commonly from relationships and concern for the specific needs of others. Gilligan criticizes Kohlberg because his highest stages, 5 and 6, are structured in terms of the male approach to morality while the feminine voice falls at stage 3. Furthermore, Kohlberg's initial experimental subjects were limited to young males.
The result, in Gilligan's view, is that women are underscored. Of course, a danger in the ethic of care is that it might be interpreted to restore and legitimize the stereotype of women as care giving subordinates not deserving of moral autonomy. Subsequent research both challenges and supports Gilligan's view.
Reason or Emotion?
Controlled or automatic? We have seen that Kohlberg and Gilligan (and most moral philosophers) take the position that moral decision making is the controlled product of analysis, deliberation and experience. In recent years, however, new psychological and neuroscience evidence has supported an alternative theory of morality that involves decision making by emotion or intuition. The emotion/intuition approach claims that moral decision making is an automatic, nonreflective process in which our minds, when confronted with a moral question, instantaneously generate feelings of approval or disapproval.
Brain-scanning experiments have provided support for the automatic emotion/intuition hypothesis. Some scientists speculate that controlled moral reasoning may be little more than an after-the-fact method of justifying conclusions already reached automatically via emotions/intuitions. Moral theorist Marc Hauser extends the emotion/intuition thesis in his book Moral Minds. He claims that our brains are biologically endowed with a moral faculty that has evolved over eons and is designed to reach very rapid judgments about right and wrong based on unconscious processes that are involuntary and universal.
Thus, when we judge an action to be morally right or wrong, Hauser says we are doing so instinctively, using our inborn moral faculty. Even babies seem to make moral judgments. Experiments show that 6- and 10-month-old infants overwhelmingly prefer helping characters (objects manipulated like puppets in helping/hindering situations) over neutral characters and neutral characters are preferred over those who actively hinder others. The emotion/intuition/ biological theory provides a stern challenge to Kohlberg and to our faith in moral reasoning generally.
Psychologist Jonathan Haidt compares the intuitive, moral machinery of the brain with an elephant and conscious moral reasoning with a small rider on the elephant's back. Other scholarly evidence, however, continues to support a very robust role for rational moral decision making, and reasoning may at times override intuitions, as Haidt himself acknowledges. Overall, moral decision making may be the product of a dual process system employing both automatic emotions (produced deep in the brain in its older structures) and controlled reasoning (produced in the newer, frontal lobes of the brain. [For more, see the website YourMorals.org, where Haidt and his colleagues invite you to "learn about your own morality, ethics, and/or values, while also contributing to scientific research."]
Moral Identity?
The moral development story does not end with an understanding of moral reasoning and moral emotion. Neither of those forces, according to current research, adequately explains why some among us are moved, after reaching a moral judgment, to take moral action. Early evidence suggests that a critical feature in total moral development, including the will to act, involves what is labeled moral identity.
In general, moral identity involves the degree to which moral concerns are central to our sense of self. As Professor Sam Hardy explains it, a person might have a stronger sense of moral identity if that identity is centered more on moral virtue than on amoral virtues such as creativity. Some studies find that those with stronger moral identities are more likely to engage in good behaviors such as volunteering or showing respect for members of "out-groups." Remember, however, that the moral identity evidence remains quite tentative.
Organizational Forces
Obviously, individual character influences corporate misconduct, but organizational culture is also important. Unfortunately, only 10 percent of American companies demonstrate the characteristics that are associated with a "strong ethical culture," according to a 2007 Ethics Resource Center study. Similarly, Ethisphere Institute, in its 2012 ranking of the world's most ethical companies, reviewed 5,000 nominees and identified 145 (102 of which were American) that met its standards. Ethisphere bases it rankings on what it calls an Ethics Quotient derived from nominees' codes of ethics, regulatory and legal infractions, sustainable investment policies, corporate citizenship, and more. [For the Business Roundtable Institute for Corporate Ethics, see https://www.corporate-ethics.org/] Pressure to cheat is often cited as evidence of an organization's ethical culture. A nearrecord 13 percent of American for-profit workers "perceived pressure to compromise standards in order to do their jobs," according to the 2011 National Business Ethics Survey. Thirty graduates of the Harvard Business School agreed to in-depth interviews about their on-the-job ethics experiences, including the pressure to cheat felt by their bosses:
I really feel for people who are middle management, with a wife and four kids, under financial strain. . . . You see it happen all the time, that people are indicted for fraud or larceny. You can empathize with their situation. The world is changing fast. And a lot of people have been blindsided by it-so they've done things that they don't like. I can't say that will never happen to me. It's easy for me as a single person. . . but when you're desperate, you're desperate. [My boss] was not willfully unethical. It was the pressure of the time. . . . I have no idea what pressures were on him to drive the project.
It probably wasn't [his] initiative to fudge the numbers. There may have been a good intention at some point in the organization. But as it got filtered through the organization, it changed. Some executive may have said, "This is an interesting project." Unfortunately this got translated as, "The vice president really wants this project." This sort of thing can happen a lot. Things start on high. As they go down they are filtered, modified. What was a positive comment several levels above becomes "do this or die" several levels down. [For a variety of business ethics links, see https://www.ethics.ubc.ca/resources/business/]
The Boss
Top corporate bosses have hit a particularly rough patch in American life. Many have been disgraced by various scandals, and a number of them are in jail. Wall Street executives are accused of bringing the economy to near collapse while continuing to collect big bonuses. Although business leaders often blame these trust woes on a "few bad apples," the 2013 Edelman Trust Barometer (a survey of 26,000 people in 26 countries) found that only 18 percent of respondents "would trust a business leader to tell the truth in a complex situation." Notwithstanding the current cynicism, we know that bosses are crucial in setting the ethical climate in an organization. The Wall Street Journal reviewed retired corporate chief Herb Baum's leadership book:
In The Transparent Leader, Herb Baum argues that a climate of integrity is crucial to the success of a public company and that it begins at the top. Mr. Baum . . . is at the top himself, but he drives a VW Beetle to work, he tells us, and doesn't have a reserved parking space. Not that he minds: He arrives at 5 am, ahead of the crowd. He espouses straight talk, solid values, and hiring literally good people-as opposed to people who are merely good at their jobs. His catchall term for this ethos is "transparency."
How to create it? Mr. Baum rightly insists that it has to come from the chief executive's office. He emphasizes valuing people by keeping an open door, communicating honestly, listening carefully, and making sure that integrity permeates every aspect of the company. Hypocrisy is anathema: "A lot of CEOs, including me, are overpaid," he says bluntly-and at one point he distributed his annual bonus to Dial's lowest-paid employees.
[For a film treatment of ethical issues in the business community, see the trailer Wall Street: Money Never Sleeps, at https://www.youtube.com/watch?v=HcMFA2SHES4]
Questions-Part Three
1. a. Do you think it is important for our character development to have heroes in our lives? Explain.
b. Do you think we have fewer heroes today than in the past? Explain.
c. Do you have a hero? Explain.
2. A Business & Media Institute study entitled Bad Company looked at the top 12 television dramas from May and November 2005, including shows like CSI and Desperate Housewives. Thirty-nine episodes featured business-related plots, and among those shows, 77 percent projected unfavorable images of business. The Law & Order episodes, for example, had businessmen committing almost 50 percent of the felonies- mostly murders.
a. Do you think those unfavorable depictions of business are unfair? Explain.
b. Do you think those depictions significantly harm the image of the business community? Explain. See Editorial, "TV's Killer Capitalists," The Wall Street Journal, July 14, 2006, p. W9.
3. Does a corporation have a conscience? Explain. See Kenneth Goodpaster and John B. Matthews, Jr., "Can a Corporation Have a Conscience?" Harvard Business Review, January-February 1982, p. 136.
4. "You are being considered for a promotion. Would you flirt with your boss or someone else who can help you get the job?" Money Magazine asked this and other ethics questions in a national poll of 1,000 adults. Answer the flirting question, then go online to see how your answer compared with the poll response: "Money and Ethics: How You Stack Up," CNNMoney.com [https://money.cnn.com/galleries/2007/moneymag/0705 /quiz.money_ ethics.moneymag/3.html?score=2]
5. Kansas City Royals pitcher Gil Meche, 32 years old and troubled by a shoulder injury, decided in 2011 to retire from baseball. The decision would not be considered particularly newsworthy beyond the sports pages except that Meche passed up the $12 million final year of his contract by doing so. Others in similar situations have reported to spring training, gone through the motions and collected their big paychecks. Meche said, "When I signed my contract, my main goal was to earn it. Once I started to realize I wasn't earning my money, I felt bad." Meche thought he had already earned enough from the Royals: "Making that amount of money from a team that's already given me over $40 million for my life and for my kids, it just wasn't the right thing to do."
a. Would you do the same as Meche if you were similarly situated? Explain.
b. Have you ever spurned money for reasons of principal?
c. Why did you do so?
d. Was Meche employing utilitarian or formalist reasoning? Explain. See Tyler Kepner, "Pitcher Spurns $12 Million, to Keep Self-Respect," The New York Times, January 26, 2011 [https://www.nytimes.com].
6. Boris Siperstein, 38, of Austin, Texas, bikes to meetings for his private-equity firm and estimates that he has saved the firm several thousand dollars because he takes his folding bike on business trips and uses it in place of cabs. Siperstein has also slept on the floor of the company's former Manhattan headquarters rather than exceed his personal limit of $200 for a hotel room. David Payne, 41, a trainer for a Brooklyn, New York, software firm, often washed his clothing in the bathtub while on the road. Now he travels with detergent and uses local laundromats, thus saving, he estimates, $30 to $40 off hotel service.
a. Will you impose frugal spending limits on yourself when you are on a company expense account? Explain.
b. Is frugality morally required? Explain.
c. Do employers value frugal employees? Explain.