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Session 305: The Values Based Approach

The sustainable way of

achieving consistent ethical

behavior

Ruth N. Steinholtz, London, UK Ruth.steinholtz@btinternet.com

SCCE 8th Annual Compliance & Ethics Institute

September 13-16, 2009 | Las Vegas, NV

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“It is exceedingly difficult to realise the economic benefits of an ethical orientation

without actually having an ethical

orientation”

Dr. Lynn Sharpe Paine

Rules vs. Values

• Why people respond differently to these

different approaches

• Why has the compliance approach predominated so far, even though there is

evidence it isn’t sufficient/working?

• Rules aligned with values= compliance

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Why measure values and how to develop them

• Organisations express their values

through their culture

• Rules misaligned with values or limiting values in the culture cause compliance

failures

• Cultural bias from headquarters leads to

passive resistance and failure to embed

your policy

Approaches to values management

• Random development

• Enforcement approach

• Process driven, systematic approach

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You can’t just make up values and put them out there

• The need to understand the culture

• There is a relationship among values:

Respect

Accountability

Integrity

Does the order matter?

Richard BarrettRichard Barrett

Maslow’s Needs to Barrett’s

Consciousness

Know and

Understand

Physiological

Safety

Love & Belonging

Self-esteem

Self-

Actualization

Abraham Maslow Abraham Maslow Know and

Understand

NeedsNeeds ConsciousnessConsciousness

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Stages in the Development of Organisational Consciousness

Service

SERVICE TO HUMANITY AND THE PLANETSocial responsibility, future generations, long-term perspective, ethics, compassion, humility

External Cohesion

STRATEGIC ALLIANCES AND PARTNERSHIPSCollaboration, environmental awareness, community involvement, employee fulfillment, coaching/mentoring

Internal Cohesion

BUILDING CORPORATE COMMUNITYShared values, vision, commitment, integrity, trust, passion, creativity, openness, transparency

Transformation

CONTINUOUS RENEWAL AND LEARNINGAccountability, adaptability, empowerment, delegation, teamwork, innovation, goals orientation, personal growth

Self-Esteem

HIGH PERFORMANCESystems, processes, quality, best practices, pride in performance,

Relationship

EMPLOYEE RECOGNITIONLoyalty, open communication, customer satisfaction,friendship,

Survival

FINANCIAL STABILITYShareholder value, profit, organisational growth, employee health and safety

Positive Focus / Excessive FocusExcessive Focus

Control, Corruption, Greed

Bureaucracy, Complacency

Manipulation, Blame

Placement of values by level

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Current Culture 100 Employees

Top Ten Values

1. tradition (L) (59)

2. diversity (54)

3. control (L) (53)

4. goals orientation (46)

5. knowledge (43)

6. creativity (42)

7. productivity (37)

8. image (L) (36)

9. profit (36)

10. open communication (31)

ServiceService

External cohesionExternal cohesion

Internal cohesionInternal cohesion

TransformationTransformation

Self-esteemSelf-esteem

RelationshipRelationship

SurvivalSurvival

4422 55

77

99

66

88

33

110

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Cultural Entropy – Definition

CULTURAL ENTROPY

Cultural entropy is the amount of energy in an organization that

is consumed in unproductive work. It is a measure of the friction,

and pent-up frustration that exists within an organization.

CULTURAL ENTROPY

Cultural entropy is the amount of energy in an organization that

is consumed in unproductive work. It is a measure of the friction,

and pent-up frustration that exists within an organization.

Flexlite (53)

Level 7

Level 6

Level 5

Level 4

Level 3

Level 2

Level 1

Personal Values Current Culture Values Desired Culture Values

PL= 10-0 | IRS (P)= 5-5-0 | IRS (L)= 0-0-0 PL= 4-7 | IROS (P)= 0-0-4-0 | IROS (L)= 0-4-3-0 PL= 11-0 | IROS (P)= 1-5-5-0 | IROS (L)= 0-0-0-0

Matches

PV - CC 0CC - DC 1PV - DC 2

1. honesty 27 Level 5

2. commitment 24 Level 5

3. accountability 20 Level 4

4. adaptability 18 Level 4

5. reliability 18 Level 3

6. responsibility 18 Level 4

7. trust 17 Level 5

8. fairness 16 Level 5

9. caring 15 Level 2

10. humor/fun 15 Level 5

Black Underline = PV & CC Orange = CC & DC P = Positive L = Potentially Limiting I = Individual O = Organizational

Orange = PV, CC & DC Blue = PV & DC (white circle) R = Relationship S = Societal

1. blame (L) 27 Level 2

2. long hours (L) 24 Level 3

3. profit 23 Level 1

4. bureaucracy (L) 22 Level 3

5. control (L) 21 Level 1

6. cost reduction 20 Level 1

7. productivity 20 Level 3

8. short-term focus (L) 18 Level 1

9. manipulation (L) 15 Level 2

10. continuous improvement 14 Level 4

11. power (L) 14 Level 3

1. customer satisfaction 31 Level 2

2. accountability 26 Level 4

3. continuous improvement 24 Level 4

4. commitment 20 Level 5

5. quality 15 Level 3

6. teamwork 15 Level 4

7. cooperation 14 Level 5

8. employee fulfillment 14 Level 6

9. employee recognition 14 Level 2

10. information sharing 13 Level 4

11. respect 13 Level 2

Values Plot Copyright 2008 Barrett Values Centre August 2008

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What do you do next ?

• Mission/Vision

• Tools for decision making rather than

detailed complex rules to follow

• Developing and telling stories

• Workshops and discussions at meetings

• Monitoring and measurement over time

It’s a Question of Ethics

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Our values drive our actions

Exceed NimblicityTM

Responsible Respect

We are leaders in Health, Safety and the Environment

We are good neighbours wherever

we operate

We do business

according to high ethical standards

We involve people and communicate in a

straightforward way

We work together -

helping and developing each other

We are “One Company”- building on diversity

Our customers’ and owners’ success is our business

We win through commitment and

innovation

We deliver what we

promise - and a little bit more

We are fit, fast and

flexible

We create and capture

opportunities

We seek the smart and

simple solutions

Decision Tree Use the Decision Tree to help you decide whether a course of action is correct when you cannot

otherwise find the answer in the Borealis Ethics Policy

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Framework

For the occasions on

which an issue or situation arises which

falls into

a ‘grey area’, use the

following ‘Framework’

to guide your thinking

New (?) skills for professionals

• Beyond the subject matter

• Cross-functional/interdisciplinary – team

work, not silos

• Openness to the values of others – there

may be no right way to do a wrong thing,

but there are plenty of right ways to do a

right thing!

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Soft skills

• Listening

• Facilitation

• Strong influencing skills

• Story telling (and creating)

• Team development

• An ability to read the organisation from a

“gestalt” perspective

Leadership, leadership

Leadership

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Strong values led leadership is only a start however

• System alignment is critical

• Performance measures

• Incentives and compensation

• Reporting and information gathering

• Investigation protocols

• Disciplinary procedures and actions

We are living in an important moment for ethics & compliance

We have a responsibility to

develop sustainable approaches

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It’s a Question of Ethics