Leadership essentials: Ethics goes beyond legal considerations

Stop asking, "Can I?" and start asking, "Should I?", says Prof Tim London of the UCT Graduate School of Business.

The bulk of my background is in studying how organisations work; I also have an LLM in corporate governance that has led to a lot of my writing, teaching, and speaking being focused on issues of accountability. This can range from working with leaders on how to better understand their motivations, teams on how to build a shared set of values, and public engagements about the ways in which many scandals are, and should be, handled. In all of these spaces, I am often asked for the one or two key things that will solve major accountability issues or insulate organisations from failures of governance in the first place. And I say the same thing every time: I wish it was that easy, and don’t listen to anyone who tells you it is.

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Anyone who has sat in one of my talks or been one of my students will tell you that I am quite reticent to provide “fixes” to problems for the simple reason that, no matter how much it’s explained to me, it’s likely that I won’t have enough information to give a complete answer. Even if I miraculously nail the solution, there are then dangers of other people assuming that that’s the fix for all similar problems they might face. What I do in these scenarios is not leave people with some magical seven-step process that fixes all of their problems but rather, give them key questions that can help them better understand their situation and better inform their approach to tackling them.

In that vein, and in light of the ethical and organisational scandals we are confronted with on a daily basis in the local and international news, I would like to focus on a very simple suggestion: don’t stop at asking the “Can I?” question.

Defences for ethical lapses tend to start with some sort of reassurance that the actions taken were, technically, legal. Of course, while laws are useful signposts for what is considered ethical or unethical behaviour, replacing ethical considerations with legal ones is problematic.

The legal rationalisation stems from asking the question “Can I?” In other words, is this action technically illegal, can I be arrested or sued, and have my lawyers assured us that any culpability will be minimal compared to the benefits? This can lead to actions that, when brought to light, lead to statements such as this one in a memo from AT&T CEO Randall Stephenson following their reported involvement in dealings with Michael Cohen (Donald Trump’s personal lawyer): "To be clear, everything we did was done according to the law and entirely legitimate". From the details reported thus far, it is almost certain that this statement is factually correct, and AT&T did not break any laws in this engagement with Cohen. The ethical implications of their behaviour, however, are going to cause damage both inside and outside the organisation, regardless of their legal standing.

 

The odds of avoiding these types of issues, then, can be greatly enhanced by going beyond the “Can I?” question (though it should go without saying that ensuring you’re not breaking any laws is important!) to the “Should I?” This moves past the purely technical hurdle of the legal aspects and allows a deeper discussion on whether the decision being made is in line with the organisation’s values and purpose. Asking this second question has multiple important effects on decision-making:

  1. It focuses potentially contentious conversations on shared aspects: how does the decision help push towards the organisation’s purpose and how does it fit with the organisation’s agreed values? Focusing on shared aspects and the organisation focuses the analysis on common points of interest, rather than solely self-interest.
  2. If you’re in one of the many organisations that has not yet established its purpose or shared values, asking the “Should I?” question highlights this essential gap. This can be a powerful motivator for having the tough conversations to build the organisation’s shared purpose and values.
  3. The “Should I?” question elicits a more nuanced discussion, and also removes some of the power dynamics from the debate. The “Can I?” question can be resolved by saying “I’m the boss”, whereas the “Should I?” question enables input from different perspectives and varying levels of power.
  4. Asking the “Should I?” question also moves away from focusing solely on the structural aspects of an organisation (the rules, regulations and hierarchy) and highlights two other essential aspects of any organisation: its culture and its people. Bringing all three into the debate ensures a healthier evaluation of related opportunities and risks, in addition to providing transparency and generating buy-in.

The vast majority of major scandals we see are not due to a lack of organisational rules and regulations (smaller and/or newer organisations are more likely to suffer in this department). I am certain that the governance guidelines for KPMG, Novartis, Carillion, Steinhoff, and any other firm that has made the news for accountability failures are written to the highest standards. In some of those cases, illegal actions may have been taken; in all of those cases, there were elements of a less-than-ethical culture and behaviours by individuals that either veered into the illegal or at least undermined any sort of ethical organisational culture.

Also important in this discussion is that the “Should I?” question should not be reserved solely for the C-level or board of directors. This question is most impactful if it’s a key aspect of decisions taken in all areas of the organisation and at all levels. Building this thinking – a focus on a common purpose and shared values – not only increases the likelihood of avoiding ethical crises, but simultaneously creates alignment between an organisation’s structures, culture, and people.