Yesterday I gave a talk on ethics to the incoming class at The Johns Hopkins Carey Business School. As some of you might know, I received my BA and MA from Johns Hopkins in 1982 long before they had a business school. It was fun to talk to all of the entering MBA students who came to the school from all over the world. It largely serves international students.
At the end of my talk I took questions, both formally, and informally after the talk was over. The biggest question was, “Mr. Merkel, what you say about ethics might be the best policy for business in the US, but when I return to my home country, it will not be well-received. What should I do?”
This is a tough one. I think people have an easier time missing out on gains by being ethical than losing one’s job. But let me give a few ideas anyway.
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- Many countries where business ethics aren’t practiced set themselves up for financial crises and scandals. One strategy could be to bide your time and wait for the next large scandal or crisis. Then suggest to your management (assuming your firm survived) that managing in an ethical way could prevent these problems, and potentially attract more business to your firm.
- Take a chance and try to create your country’s equivalent of Vanguard. Low cost, mostly passive investing, owned by clients, limited management salaries, etc.
- Same as #2, but if you get the chance to start or run any firm, adopt ethical practices and make it a selling point. You could be the start of cultural change. (Now elements of that could prove difficult if there are government officials expecting bribes… how you work that out is difficult. Friends of mine working as missionaries in corrupt countries tell me that you can still get things done without bribes, but it takes longer, with more effort.)
- Suggest to government ministers that a lack of ethics holds back growth. Countries with no bribery, low corruption, and moderate regulations tend to grow faster.
- Propose small experiments in your firm testing whether an ethical approach will produce better results.
- Consider working for a foreign firm in your country if they have ethical standards.
- Consider gaining experience in a country other than your home country, and propose to that firm that they try setting up a subsidiary in your home country.
- On the side, develop a voluntary organization that promotes ethical business conduct. Consider publishing some books that point out how unscrupulous business practices are harming most people. Recruit well-known foreign businessmen known for clean business practices to come talk in your country.
I can’t think of anything more right now. Readers, if you can think of other ideas, please mention them in the comments. Thanks.
PS — One more note, having worked for a few firms that were ethics-challenged as far as accounting and sales practices went, I can say that trying to promote change from inside is tough. Taking a job at another firm was my way out of those situations. No surprise that almost all of those firms failed.