Speak no evil
Secure job promotion the ethical way.
By Evelyn Beck
When Howard Kanter was just starting out as an accountant, his boss issued a peculiar directive. No matter how much or how little work Kanter performed on a given day, he was to process an identical number of invoices—in effect, to present a more balanced portrait of the firm’s billings than the more frenetic reality.
While Kanter, now an accounting professor at DePaul University in Chicago, never forged any invoices, he nevertheless feels that he acted unethically. His boss, he says, was preparing to sell the company and wanted to positively influence prospective buyers. “In retrospect,” he explains, “it was fraud, and I was an unknowing part of it.”
According to the 2005 National Business Ethics Survey from the Ethics Resource Center, among more than 3,000 American workers who participated, one-third stated that they had experienced work situations that invited ethical misconduct. These results were mirrored in a 2005 poll of more than 2,000 US workers conducted by the Hudson Highland Group, in which 42 percent said they had encountered ethical “gray areas” at least occasionally. Such situations become problematic when workers feel pressure against their own ethical judgment.
As you seek to advance in your career, such pressure is only likely to worsen. James Rest, in his book Moral Development in the Professions, cites a study conducted by Lawrence Poneman and David Gabhart, which found that the longer new professionals in accounting and auditing stayed with a specific firm, and the higher up they were promoted, the more their moral reasoning scores declined—largely due to pressure from management.
“If accounting students coming out of schools are aware of how corporate biases and pressures can change their sense of propriety, they can resist it more,” says William Wilhelm, who teaches in the College of Business at Indiana State University in Terre Haute.
Experts urge ambitious young accountants to investigate a company before accepting a job. “Look for what others have said or measured in terms of the corporation’s reputation for working with employees and other stakeholders,” says Diane Swanson, a business administration professor and chair of the Ethics Initiative at Kansas State University in Manhattan, Kan. She also suggests finding out whether the firm has an ombudsperson who can handle internal disputes, a peer review panel for due process, and protection for whistleblowers.
Most agree that an organization’s ethical tone is set at the top. In a 2005 Fast Company survey of 1,665 mostly American, mostly middle- and senior-management respondents, 95 percent agreed that the values of the CEO affect the way business gets done. One sign of just how business does get done is the CEO’s pay level. “If it’s totally out of whack compared to the average worker, then that’s a red flag in my view that the top CEO may not have empathy for other employees, and may not be sensitive about their role in the organization,” says Swanson.
Traditionally, ethical dilemmas for accountants have resulted from having to simultaneously audit and consult for the same client. The Sarbanes-Oxley Act has addressed some of these conflicts in the public sector. But the situation can still create difficulties, especially for novices.
“These young kids get out on an audit team for a big client and they find these problems or at least questions, and they do what they think is right,” says Norman Bowie, who holds a chair in Corporate Responsibility at the University of Minnesota in Minneapolis. “Then their superior says, ‘This is a big account; surely they have a good explanation,’ or, ‘We should take them at their word.’ Then these young professionals are in a real moral dilemma.”
Bowie suggests heading off such situations by asking during the hiring process, “What happens when I find problems in accounting with a big client?”
On a more personal level, another ethical dilemma is presented by the temptation to sabotage a hotshot coworker who stands in the way of your own success. Kanter remembers, with regret, being part of such a group. “We had this brand new Stanford grad on our team,” he recalls. “His behavior created a lot of animosity. We didn’t want him there. We harassed him until he quit. And thus ended his career at our firm.”
To guard against ethical pitfalls, first evaluate your own standards. Specifically, what drives you? A 2004 survey of 1,150 members of the Institute of Management Accountants (IMA) showed that the more an individual is motivated by self-interest (that is, a focus on rewards such as money, status, job security and promotion potential), the more likely they are to endorse unethical behavior. Conversely, the greater one’s concern for others, the less likely the person is to act unethically. In addition to these internal values, ethical behavior is also influenced by organizational and professional values.
Second, evaluate your moral reasoning ability. According to Wilhelm, there are four questions to ask:
- Can I recognize an ethical dilemma?
- Can I adjudicate what to do?
- Will I take that action?
- Do I have the fortitude to take the morally correct choices in life, and to not slip down that slippery slope?
Ethical behavior, says Wilhelm, is a cognitive process of making decisions. The better you become at weighing alternatives and identifying courses of action, the easier it is to make the right choices. When faced with an ethical dilemma, you must decide how to respond: Do you give in? Do you not give in but accept censure? Do you blow the whistle? Do you leave?
Speaking out against unethical behavior takes guts. Not acting at all can lead to feelings of intense guilt and regret. Take the case of a young accountant in what was then a Big Eight firm, pressured by a supervisor to give a clean opinion of what he actually considered to be a grossly exaggerated real estate valuation. He refused and was disciplined; a negative letter was placed in his file.
“He chose not to rock the boat,” says Kenneth Goodpaster, who holds a chair in business ethics at the University of St. Thomas in Saint Paul, Minn. “He didn’t leave the firm. He just swallowed it, probably because he didn’t intend to stay with that firm for very long, and he didn’t want to cause a scene that might threaten his career progression. Some might think that was a prudent career decision, but I would say it wasn’t. He later wrote a case study about that experience because he thought he caved in and shouldn’t have.”
You will resist pressure more successfully if bolstered both internally and externally. That’s one finding from a survey of 215 IMA members, which asked respondents to rate the factors that would help them resist pressure to act unethically. Ninety-four percent cited an individual sense of ethics, and 90 percent cited a professional code of ethics.
“A lot of people get into professional situations and somehow feel that, by acting with integrity or by voicing moral reservations, they’re putting their entire career in jeopardy,” says Goodpaster. “My belief is that the opposite is true. They may well be ensuring that their career gets on a much stronger foundation.”
