By now you've probably heard the story of the fraudulent business practices at Wells Fargo, the US bank that put pressure on employees to create false credit card and deposit accounts. Have you asked yourself what you would do if you were an employee facing that kind of pressure? In other words, how do you handle a situation in which the incentives seem to be telling you to do something you believe is bad for your customers and clients, or maybe even illegal?
What if it is clear your boss wants you to get with the programme – and your bonus, a promotion or even your job are on the line? Here is some advice for dealing with a situation where you think you are potentially being incentivised to do the wrong thing:
Make sure you really understand the situation: what Wells Fargo did was clearly wrong, but other situations can be subtle. So make sure you ask yourself questions like these: in what specific ways does the practice that concerns you violate ethics, customers' interests or even the law? What is the alternative view of the situation and does it have some merit?
If you can, check with others: try to find a knowledgeable, discreet person in your company and run your concerns by him or her. Then ask if you might be missing something and if there might be other ways of thinking about the practice.
Make a simple decision tree: list your options, put down the possible consequences of each option and ask yourself how likely these consequences are. A simple decision tree can give you a somewhat objective lay of the land and help you really think through your options as you would for any management problem.
Think creatively: ask yourself if there are other ways you could help your boss achieve his or her goals without crossing whatever ethical or legal lines concern you. You may surprise yourself and find a way out of your jam that works for you and your boss.
Consider having a candid conversation with your boss: telling people that they are behaving unethically usually comes across as an accusation. The better framing is usually along the lines of: "I think we've got some serious legal risks here" or "we're doing something that could backfire with our clients or regulators."
Frame your concerns as practical, maybe urgent, managerial issues.
Even if you follow the five steps above, you may not find a way forward. Then you face a hard decision. You need to step back and ask whether you can live with yourself if you do some version of whatever concerns you, or whether you have to update your CV and take a stand. This might mean falling from favour or even leaving your job, but at least your values will be intact. – Copyright Harvard Business Review 2016
Joseph Badaracco is a professor of business ethics at Harvard Business School, where he has taught courses on leadership, strategy, corporate responsibility and management.
