Shaping an Ethical Workplace Culture

Summary: Organisations that are perceived to act ethically by employees demonstrate improved business outcomes. The perception of ethical behaviour does increase employee engagement, organisational commitment, trust, and organisational citizenship behaviours. Here I introduce you to the ‘UK Government’s Seven Principles of Public Life’ and show you how to apply its tenets in private sector organisations.

“Even the most rational approach to ethics is defenceless if there isn’t the will to do what is right” (Alexander Solzhenitsyn)

Following my previous HR blog on Non-Negotiable Corporate Values, people have been asking me about more specific ethical standards for senior leaders and managers. So, in this opportunity, I will introduce you to the ‘Nolan Principles’.

In 1994, John Major, the then UK Prime Minister, established an independent public body to advice government on ethical standards across the whole of the public sector. This Committee was under the Chairmanship of Lord Nolan.

Lord Nolan published in May 1995 what he called ‘The Seven Principles of Public Life’ often referred to as ‘The Nolan Principles’. The report established a well-researched set of values and behaviours that outline the expected ethical standards for all those individuals working in the public sector.

“Ethics must begin at the top of an organisation. It is a leadership issue and the chief executive must set the example” (Edward Hennessy)

This set of behaviours can also be applied to senior leaders running private sector operations. So here I summarise and adapt the ‘Nolan Principles’ for the benefit of public and private sector organisations.

1. SELFLESSNESS: Becoming selfless starts with concerning yourself with the welfare of others without any consideration for personal gain. Therefore, holders of public office should act solely in terms of the public interest. If we apply this principle to the private sector, business leaders and managers should not put profits (or their bonuses) before the welfare of employees and communities where the organisation operates. This principle is pertinent, businesses are increasingly being judged by their performance on environmental, social and governance issues.
2. INTEGRITY: Having integrity is contingent upon doing the right thing even when nobody is watching, behaving honestly and consistently adhering to high ethical standards because it’s the right thing to do. Holders of public office and business leaders must avoid placing themselves under any obligation to people or organisations that might try inappropriately to influence them in their work. They should not act or take decisions to gain financial or other material benefits for themselves, their family, or their friends. They must declare and resolve any dubious relationships that may lead to potential conflicts of interest.
3. OBJECTIVITY: Being objective at work refers to using a fair and balanced criteria for making decisions concerning employees or business matters. Holders of public office and business leaders must act and take decisions impartially, fairly and on merit, using the best evidence and without discrimination or bias. All decisions must be based on hard facts and evidence, and not on emotional reactions, gut feelings, or the particular judgment of one person or a group.
4. ACCOUNTABILITY: The same way holders of public office are accountable to the public for their decisions and actions, business leaders are also answerable to shareholders, and even the workforce itself, for their decisions, actions, resulting business performance and company culture (stated mission, vision, values and purpose), and must submit themselves to the scrutiny necessary to ensure this.
5. OPENNESS: Holders of public office and business leaders should act and take decisions in an open and transparent manner. Information should not be withheld from the public and/or key stakeholders unless there are clear and lawful reasons for so doing. In the work environment, openness also refers to valuing new experiences and new thought processes, it means being sensitive to differences and receptive to diverse ways of working and styles, opinions, and most critically, performance feedback.
6. HONESTY: It refers to being incorruptible (never steal, cheat, or lie) which sets the tone for the kind of work culture that you want to create, providing consistency in workplace behaviour, and building loyalty and trust in employees, customers, and prospects. In this respect, holders of public office and business leaders should always tell the truth, and never try to deceive people or break the law.
7. LEADERSHIP: Establishing the right culture at the top of your organisation will ensure the Nolan Principles permeate through the entire business. Holders of public office and business leaders should exhibit these principles in their own behaviour. They should actively promote and robustly support the principles and be willing to challenge poor behaviour wherever it occurs. It is senior leadership that should set the tone here.

These seven principles articulate the values the organisation wishes to foster in leaders, managers and employees, and in doing so, define the desired organisational culture. It serves not only as a set of internal guidelines for leaders and employees to follow, but also acts as an external statement of corporate values and commitments.

“If you believe in unlimited quality and act in all your business dealings with total integrity, the rest will take care of itself” (Frank Perdue)

I am pretty sure you won’t find many people who disagree with the Nolan Principles. These Seven Principles of Public Life have proved influential and are enshrined in codes of conduct across the UK public sector, from schools and government departments to hospitals. These seven tenets are critical for organisational success, and I believe these can be incorporated into a variety of private-sector-related codes. Now, the question is, does your organisation follow these principles?

Measuring the ‘Nolan Principles’

How can we effectively monitor these principles in different work environments? Here I propose an employee survey index, which can be applied in both public and private sector organisations to monitor ethical standards.

“Do it from the heart or not at all” (Jeanette Winterson)

1. SELFLESSNESS: Management shows sincere interest in the wellbeing of employees.
2. INTEGRITY: Management operates with integrity in its internal and external business dealings.
3. OBJECTIVITY: Management’s decisions are made based on hard facts and evidence, not emotional reactions, or internal politics.
4. ACCOUNTABILITY: Management is held accountable for their actions.
5. OPENNESS: Management effectively communicate the reasons for important decisions.
6. HONESTY: Management has established a work environment where the truth can be taken up the chain of command without fear of reprisal.
7. LEADERSHIP: Management behaves in a way that is consistent with our corporate values and behaviours.

The combination of these survey statements will offer an accurate means of assessing ethical standards in your organisation. I would recommend using a five-point Likert scale to measure the level of agreement or disagreement on each of these statements (e.g., Strongly disagree / Disagree / Neither agree nor disagree / Agree / Strongly agree). We normally assess these survey statements through favourable scores (Strongly Agree + Agree).

I have used these statements in multiple employee surveys in the UK and I am always surprised to see less favourable scores on selflessness, objectivity, accountability, and openness. The favourable scores for these themes notched between 45% and 55% while the results for Leadership and Integrity were both above 75%. This may suggest people feel their managers meet the organisation’s code of conduct guidelines (e.g. they tick all the right boxes) but are not fully enabled and empowered to integrate these behavioural notions into more specific day-to-day work-related activities.

In general, if your combined favourable results exceed 75% in this index, you can confidently say your employees keep management in high regard when it comes to behaving ethically. If your combined favourable scores are around 60% it means your corporate ethical standards are very much in line with those of other UK organisations.

It is concerning when all seven statements show combined results that are below 50%. It does reveal poor ethical practices, where managers ignore internal procedures and protocol. This situation does have a negative effect on employee engagement and performance. It is difficult to have a successful business without well-respected leaders. When management exhibit poor ethical behaviour, they face losing the respect of their employees. Unethical behaviour in the workplace does lead to lack of trust among employees, which is detrimental to a business that relies on collaboration, teamwork, and a sense of camaraderie.

Some Final Thoughts…

The Nolan Principles broke new ground when they were launched over 25 years ago. Due to its focus on behaviours and culture, rather than process, they have stood the test of time and remain as relevant as ever for any type of organisation, private or public, large or small, in the UK or abroad.

These principles are integral to the way business organisations operate. They will influence your interactions with employees and customers, your work with suppliers, regulators and other third parties, and your relationship with your investors.

So, you may be asking yourself, how can I prevent unethical behaviours at work? Simple, start by setting realistic corporate objectives and don’t push your people too hard. If employees are expected to meet unreachable quotas and goals, they could engage in unethical behaviour to attempt reaching those unreasonable business demands. Remember, when ethics and good governance are the foundation of your business operations, this is something that will shine through your people and in every single work-related interaction that you carry out.

• Read more: Human Work is not a Commodity
• Read more: The ‘Golden Rule’ for Managing People

Thanks for reading my blog & your kind support. Were any of the insights provided of value to you? I would welcome your feedback - please do ‘Like’ or ‘Comment’ your experience on this subject in the space provided! -?Follow me on LinkedIn?for more articles and insights!

Disclaimer: The author is making this ‘Opinion Blog / Guide’ available in his personal effort to advance the understanding of best practices in workplace related matters. The author assumes no responsibility or liability for any errors or omissions in the content of this ‘Opinion Blog / Guide’ or for the results obtained from the use of the information provided. The information is provided on an ‘as is’ basis with no guarantees of completeness, accuracy, usefulness or timeliness and without any warranties of any kind whatsoever, express or implied. The views expressed are solely those of the author in his private capacity and do not in any way represent the views of any entity whatsoever with which the author has been, is now, or is to be affiliated in the future.