Business ethics: an Oxymoron? Communication executives explore the black, the white and the gray.

Communicators have a lot on their minds and their consciences these days: widespread public distrust of corporate interests, CEOs under scrutiny, information leaks, shifting legal accountability, conflicting cultural norms, transparency considerations and evolving professional standards. In a business environment this challenging, what's an ethical communicator to do? A panel of top regional communication executives convened at the 2002 IABC international conference in Chicago, III., to find out. Following is an excerpt from that panel discussion, courtesy of moderator Louis C. Williams Jr., ABC, APR. Read the full transcript at www.iabc.com/cw.

COMMUNICATORS AS THE CONSCIENCE OF THE ORGANIZATION

Moderator: I have heard it said that communicators can or should he the conscience of an organization. Is that true?

Mary C. Moster: I've heard that said about us on many occasions, but I think it's too grandiose, and also a slam on everybody else on the management team, as though simply by definition we have more moral fiber. Every manager and every employee in a company should be responsible for the moral behavior of the company.

E. Ronald Culp: Yes, but it's also true that we listen to a wider range of stakeholders than most others within the organization. That equips us to hear concerns that come from employees, investors or customers. But I don't think we can assume any more responsibility than listening and reporting.

Matthew Gonring: Very often we're viewed as the chief information officer, and as such we know what's going on throughout the organization. I think that's how management looks at us. Any loftier role would set us up in a way that I don't think would be healthy for the organization or ourselves.

Culp: Having said that, our individual conscience has to apply to everything we do every day. This ought to be true for each of our executives as well. As chief communication people, we have access to a broader array of information from a greater variety of sources, and as a consequence, we have a broader frame of reference. That offers us the ability to judge behavior that's in-line or out of line with what would be construed as appropriate or ethical in the marketplace.

CULTURAL VARIATIONS

Moderator: What about the international perspective? Do ethics change country by country?

Master: When I taught a class on ethics with about 25 percent non-U.S. students--many are from countries where it s typical to pay for things under the table--almost to a person the international students agreed that there is no such thing as situational ethics, that even if an unethical practice is common in their country, it's bad practice.

Clarke L. Caywood: Cultural variances are diminishing as a consequence of the Internet society; ethical standards in one place now are likely to be similar in other geographic locales.

Victoria Shire: One of the things we've been doing recently is trying to heighten everyone 's awareness of the values of the corporation as we become more competitive, and taking that and moving it into our international operations.... How do we translate them in places such as China or South America? I think it goes back to what you said earlier: The standards are different in different places.

Caywood: There are standards that have been set across countries concerning bribery, transparency, environmental and social issues--bottom line [corporate] standards. And those standards should be set at the highest bar, because the law is usually the minimal bar.... Ethics really need to be woven through the entire organization, and [the organization should] make it understood that there's a zero tolerance and that we're going to make sure that we enforce them.

SETTING STANDARDS

Moderator: How does that get done for an organization?

Cuip: It doesn't get done with a manual. It starts with hiring--whom you bring into the organization--and having no tolerance for those who practice questionable ethics. You have to do things like fire people for doing something wrong when they knew it was wrong. Too many companies don't. They say, "OK, next time we really mean it; next time we're going to have to do something serious here." Ethics must start at the top and be demonstrated. The CEO's insistence on high ethical standards goes through the organization. I've seen it work.

Caywood: Don't you think we have a problem with that? Aren't the CEOs the ones who are in the hot seat today? I think they're probably the last ones right now that I'd have confidence in, unless they came forward and were more explicit about their positioning.

Moster: Who else could in an organization?

Caywood: I don't object to having it be the CEO, but ... how about the chairman of the board, who may not be the chief executive officer? How about the chief operating officer? Surely there are other people who might be listened to. Research shows, for example on finance, that the CEO is not the one the public wants to hear from; they want to hear from the CFO.

PERSONAL RESPONSIBILITY

Moderator: So how does (or can) a senior public relations practitioner influence that process?

Caywood: You have to take examples of behavior and actions that are in line with appropriate business practices and ethical standards. You have to spotlight and profile those for the organization, and conversely, those who are out of line with accepted business practices and ethical standards.

To Ron's earlier point, we're putting an awfully large burden on the chief executive officer to also assume that he (or she) is in fact the chief ethics officer and has to emulate ethical standards for the organization. Now the new New York Stock Exchange regulations are saying he or she is fully accountable for every number disseminated to any audience, and that ultimately their jobs are on the line. That individual officer is asked to be accountable for so much, and yes, from a pyramid standpoint, ultimate responsibility does fall with the chief executive. Therein lies the accountability of the communication people: To help provide the capabilities for that executive.

Shire: As an officer, you're a steward of the corporation, so you do help craft those messages and help influence people and their behaviors, and even inspire other actions. For instance, Donnelly is going through a lot of changes right now--we call it our transformation. There are a lot of behaviors that we are trying to change throughout the organization.

Master: As Vicki said, we help to craft the messages, interpret the information, bring in outside sources and views and help what I hope is an ethical group of managers make ethical decisions day by day and operate in an ethical way. I don't think you can bifurcate somehow, and say there's one person who is responsible for the ethical behavior of the organization. I think the CEO has to set a tone and has to have zero tolerance, as Ron said earlier. But when it comes down to it, he or she is not responsible for the ethical behavior of the organization, either. It's an internalized ethical code, a company culture that everybody has to practice.

Caywood: The infrastructure is the key to making this work. A lot of lip service has been paid to ethics in the past and, going forward, CEOs are going to have to be focused on ethics intensely, because they don't like even minimum-security prisons.

Gonring: From an academic point of view, universities have concluded that it's best to put the teaching of ethics into all of the classes rather than offer it as a stand-alone subject. In other words, if you teach a class on human resources or management, you should talk about the ethical issues of those disciplines.

DEBATABLE DISCLOSURES

Moderator: Let's use this as an example: During the Hewlett Packard/Compaq merger discussions, an employee of HP took an e-mail or voicemail and gave it to the other side. When CEO Carly Fiorina found out, she publicly fired that person. Fiorina was very clear that the reason for the firing was giving the message to the other side, and that she considered the move unethical. Was that an appropriate way for her to set the tone for an organization? Was it fair?

Culp: I'd say yes, as long as they had in place a system that trained people on what was right and what was wrong. Post-hoc ethics are the worst kind. But if that was the only ethical stance she had taken in the last six years, then that would be a problem.

Moster: Do you think it was a breach of ethics for that employee to do it? If you were an HP employee who really thought that the other side had the right idea and the merger was a bad idea, and you thought you were doing something that was aiding the right outcome by taking her message and giving it, do you think that's unethical behavior?

Caywood: I think it's a total gray area, and I thought it would have been an inconsistent move to fire somebody over that. Ethics has several levels. One of them is an individual level, which Matt alluded to earlier, and then there's the firm level and an industry level. There are ethical standards within some industries that are not acceptable in other industries, and you have to consider that.

Moderator: Does the good public relations practitioner have to be up on those standards?

Gonring: I think we are to a higher degree than other professions, just because we're boundary spanners by definition.... We're out there listening constantly, and we read widely. We are forced to, partly because we're looking to see if we've been mentioned. We also are more alert to possible issues.

WHEN IGNORANCE ISN'T BLISS

Moderator: Getting back to the CEO and his/her responsibility, is it fair or appropriate for a CEO to say: "I didn't know..."?

Caywood: It is our absolute obligation to keep the chief executive officer informed of risks and events.... [He or she] is at greater risk than the rest of the team.

Culp: I've been yelled at by a CEO only twice. I'm sure they've said other things out of hearing, but I mean to my face. One time was because ... my staff failed to pass the word along that The Wall Street Journal was going to raise a question about our automotive business.... The thing that he said, and it resonated with me, was: "You just can't surprise me. I have to know these things."

Gonring: Accordingly, it becomes the chief executive's responsibility to ensure that a culture of candor exists. But then it becomes our responsibility as lead communication people to make certain that there are adequate feedback channels. In other words, information that comes from the organization is able to get through to the chief executive in some way, shape or form.

Moderator: Do you think it's really possible to change a culture that already exists? And even if we could change the culture, are we the ones to do it?

Moster: Ethics and culture are the sum of all the organization, and while one person can skew it or influence it a little bit, it is not solely the communication officer's responsibility. It's everybody's responsibility.

CEOS: FEELING THE HEAT

Gonring: To paraphrase here: This is the best and the worst of times. Right now we actually have a greater opportunity than we've had in a long time, including back to the Watergate period, to change, structurally, institutional ethics. The heat's on. As communicators, we can focus the corporation on ethical issues by simply pointing to the front page. Recently an article in The Economist talked about fallen idols. It's a list of the indicted, the nearly indicted and the jailed. These are all chief executive officers. These are not politicians.

Frankly, it's a perfect time for a professional society like IABC and for universities and individuals to bring this to the attention of CEOs, because I think they see themselves as possibly going to jail over these issues, and because I think they're unclear about what their responsibilities are. The law is never black and white; the law is always gray, and ethics is an even larger gray arena. PR people and communication professionals love ambiguity. We live with it, and we're in the position to sort that out for our corporations.

Culp: It's been adopted by the media as the issue du jour. They're going to ride it because of the salaries of a lot of CEOs. If these people who are making tens of millions of dollars are not delivering, then they're fair game.

Gonring: If you take an environmental organization or a company that markets pharmaceuticals or food products, or that markets to children, the elderly or minorities, you have a greater obligation than any public figure.

Culp: The argument is that the corporate chiefs have to behave in a way that is open and public. I'm sorry that they're not going to like being on the front page of the paper, but they have those benefits, and they love those [stock] options. But I don't know if it's better or worse than it was 20 years ago.

Caywood: I think it's worse, and I'll tell you why--it's because the public thinks it's worse. Therefore it is worse.

Gonring: The reality is that studies are saying trust in political, government and business institutions is at an all-time low. The mass media have a compulsion to uncover what's at the roots.

BREAKING BAD HABITS 

Moderator: Go back a hundred years, to the robber barons and the meat packing industry. If you read the literature of the time, it seems that every corporation was suspect, and probably rightly so. Are corporations still that bad?

Moster: I think we're really answering two questions. On one level you're saying: Is there truly more bad behavior in business today? I think I would probably agree with Ron, that the ethical standards of most business organizations are surprisingly high. But I have to agree with Clarke ... that there will be a post-Enron way of looking at business.

Culp: I would agree that in the main, most employees are probably more ethical, moral, responsible--because they have to be--than they have ever been in history. The average employee is probably making more decisions than employees 20 or 30 years ago were making, and they're probably challenged more on a daily basis on ethics.

TO TELL THE TRUTH

Moderator: Have any of you ever been asked to lie?

Caywood: I think there's a lot of omission rather than commission.

Culp: Most of us probably avoid the commission lie because we judge our professional standing as highly as we judge our jobs ... but it's the omission that bothers me more. That happened to me when I was in politics. I knew stuff from surveys that we did that we were under no obligation to report because we had paid for the survey.

Moster: And that bothered you?

Culp: It did, because I thought that some of these things ought to be on the table. In other words, you cannot afford to disclose information selectively. If somebody asks you a point-blank question, "Do you know the answer to this?" and you know the answer, you have no choice, other than to say, "I can't disclose that for proprietary reasons."

Moster: I don't think I have ever been asked to lie. But, I would say many times, appropriately, I know things I don't tell.

Gonring: That's the White House model. That's why you don't want them to know "everything," because if the press were to ask them....

Moster: The spokespersons should be fully briefed, should know everything that they need to know. They should know as much as anyone else knows, or more. They should have inside knowledge, but I don't believe you're under obligation to tell everything. Certain things should not be disclosed.

Gonring: The consensus is that we've not been told to lie or asked to lie, but because of our responsibility to our businesses and as professionals there are situations where we choose, we believe ethically, not to disclose things.

INFORMATION LEAKS

Moderator: With your own staffs, given that you're saying that it's your responsibility to manage this process, how do you imbue this sort of ethical responsibility?

Culp: You make it very clear to them at the outset that the proprietary nature of information is an absolute. It's a given. And when somebody violates that, there is no other choice, other than they have to leave the organization.

Moderator: Does it have to be written? Or is it an unwritten code?

Shire: It's an unwritten code. I recently was talking to my staff about this, and they said, "It's almost as if having this position in the company makes me feel privileged, because I do have information. It helps me in the communication job I have to do by knowing more of the facts." And do I have to communicate all the facts to them? No.

Caywood: There shouldn't be expectation of a comprehensive code, because then it becomes a matter ... of reading only the literal statement. Where ethics usually goes awry, there is somebody saying, "Well, it's legal."

Gonring: If you look at the codes of ethics by IABC and other organizations, there's a valiant attempt to make clear some practices that are considered inappropriate.

TALKING IT OVER

Moderator: Have any of you ever actually had ethics discussions with your staff?

Culp: We had an issue that shook the company to its roots.... The CEO called a group of us together and said, "How could this happen? We have an ethics office and no one surfaces this?" It's because the practice that was in question was institutionalized more than 20 years previously. Everyone said, "Well, we've always done it that way. Of course it's legal." The CEO said, "No, that's not how we operate." We went public the next morning announcing that this incident had occurred. It was devastating for the company, and cost hundreds of millions of dollars and a lot of reputation points.

As Clarke pointed out, you're entrusted with a lot of information and you still should have some common sense. We had robust discussions over this whole incident, workshops on the issue of how you prepare and make sure that you don't have another.

Moster: When I talk to students, we always talk about the slippery slope--you know when you start sliding down that unethical slope. It usually starts with something very gray, that you're not absolutely certain is a bad decision. You're making a decision between two possible right decisions, but one may take you toward further decisions that will be clearly unethical.

Culp: We had an interesting result after our auto problems: people in the organization were so shocked and shaken to the core of their being that they embraced the ethics policies as never before. They saw what it could do to the company, and they also saw what it would do to their own wallets. No bonus for a couple of years is quite a wake-up call. We created a toll-free ethics hotline for employees to call before they do anything. If they think they're in a gray area, they are to call. We'll run down the answer.

Moster: Does your office handle that?

Culp: No, this is actually a separate office, reporting up through the chief ethics officer. The success of that has been phenomenal. It heads off a lot of issues.

SPIN, LIES AND EUPHEMISMS

Moderator: Wouldn't you say that the public at large probably has an image of public relations practitioners as people who exaggerate, lie, omit, etc., etc.? Let me give you just one example. You put out a press release on a departing executive who has "left to pursue other interests." That's a fudge at best, and a lie at worst, is it not?

Culp: My highest compliment came from a reporter ... who called and said, "I have to congratulate you on the way you handled the announcement of your president when you said that he was no longer with the company." The lead said, "So-and-so has left the company," period. The reporter said, "It's so clear, and I'm so grateful you didn't say 'to pursue other interests."

Master: I think that's a good example in some respects, but that one has almost become like "no comment, in the sense that "pursue other interests," means he got fired. The people who are getting fired don't want you to say "pursue other interests" any more, because it's the tacit way of saying "they got fired."

Caywood: We wear this hair shirt. We're put in these uncomfortable situations, and why are we always considered the spinmeisters, or the ones who are culpable and guilty? It's healthy, frankly, that the PR professionals worry about this. They worry about it more than other professional groups who ought to worry about it more.

But I do think you could have a long list of the kind of small violations, little violations that undercut our credibility. The point is, we have thrown ourselves into that position.... We shouldn't always be the spokesperson. We put ourselves out front, so we get blamed for a lot of things.

ETHICAL PR PRACTICE

Moderator: Let's say you're giving advice to public relations people in general. What two or three things would you tell them about ethics, their responsibility and what's expected of them? What two or three things do you think they should hear, that they should know?

Culp: Stay true to yourself and to your team. Make certain that there's absolute, strict adherence to those standards of ethics, business practices and respect. When you encounter a situation that you view as inconsistent with the standards you know, make certain that appropriate responsible parties are alerted and the issue is dealt with.

Shire: Maybe we don't have ethics genes, but I think every PR person has a gut sense about it. I know that for me, personally, every time I have not listened to what my gut says was right, it caused a problem for me. As you say, be true to yourself, and be true to that inner sense, that sixth sense you might have.

Read the full transcript at www.iabc.com/cw.