6. what is the best method for preventing an illegal or unethical activity?

In recent weeks, I have had several conversations with school personnel directors about the importance of building ethical cultures and practices. Leaders in all industries face issues concerning unethical behavior and can learn from each other about how best to tackle these situations. Here are seven practices to help prevent unethical actions in any organization:

• Create Policies and Practices: Organizations must research, develop, and document policies and processes around defining, identifying, and reporting ethics violations. These policies should be articulated in the employee handbook and protections should be put in place for those who raise ethical issues. However, having a policy is not enough. You must practice what you preach. Case in point: Years ago, the Enron Corporation was known to have one of the most intricate ethics policies in the country. The 64-page document was given to new employees with a letter from Ken Lay, the company’s Chairman and Chief Executive Officer. But, in 2001, it was revealed that Enron had engaged in major accounting fraud to disguise its poor financial health. After Enron declared bankruptcy, copies of their ethics policy went up on eBay. The Smithsonian National Museum of American History also secured a copy that now lives in the museum’s exemplary business practices exhibit. How appropriate. I encourage you to read more about the Enron scandal in the article “Management Controls: The Organizational Fraud Triangle of Leadership, Culture, and Control in Enron”published in the July/August 2007 issue of Ivey Business Journal.
• Hire Right: Selecting quality people from day one can make a huge difference in the ethics of your organization. Some organizations scour background checks, purchase screening tools, or use behavior-based interview questions, which may ask candidates to describe a situation when they acted ethically even when it was against social or cultural norms.
• Develop People’s Understanding: Most HR professionals will tell you that training people to act “ethically” will not have much of an impact, but developing a process for reporting ethics violations and building staff understanding about ethics expectations is important.
• Incent the Right Thing: Some in the education community are asking, “Do states and school districts incent people to cheat or act unethically by giving more weight to certain measures over others?” Before introducing a new measure in schools--or any other industry--leaders must consider if it encourages the type of actions that are valued by the organization. If there is a risk of impropriety, it is important to have a conversation around what checks and balances will be put in place to make sure unwanted behaviors are handled appropriately.
• Put Controls in Place: Risk management professionals will tell you that even with all the proper policies and processes in place and a staff that understands them, it is also wise to perform regular audits to help reduce opportunities to act unethically, incent individuals who may act unethically to reconsider, help catch issues that have occurred by accident, and mitigate risk all around.
• Build a Culture of Transparency, Openness, and Communication: Cultural management work is difficult. To ensure true success when it comes to organization ethics, people must see and hear what is going on as well as feel comfortable to stand up and speak out if they see something occur that is not right.
• Leadership Must Walk the Talk: Leaders can talk about the importance of policies and processes, incentives, communication, and openness all day, but if they turn around and act unethically, it can be like throwing a large stone into the pond of ethics tranquility. The same goes for promoting staff who have behaved unethically. It doesn’t take long for staff at all levels of an organization to recognize a leader who talks the talk, but doesn’t walk the walk when it comes to ethics. This can breed suspicion and destroy trust.

What has your organization done to not only ensure that it has strong policies and processes in place to build understanding around ethical expectations, but also to ensure that these policies translate to everyday action among staff and leadership?

Unethical behaviors can plague a workplace, whether an executive steals money from the company or an associate falsifies documents. Unethical behaviors can damage a company's credibility, causing the business to lose customers and ultimately shut down. However, business owners and their management teams can work with employees to prevent unethical behaviors.

Create a Code of Conduct

A written code of conduct provides employees and managers with an overview of the type of conduct and behaviors the company expects. It outlines what behaviors are unacceptable and what measures are taken if an employee violates the code of conduct. For example, a company with a social media policy in place prohibiting company discussion may need to discipline or fire an employee who violates the policy by ranting about a new workplace initiative.

Lead By Example

Employees look to business owners and managers for direction on how they should conduct themselves. As a business owner, make ethics-based decisions and monitor the individuals you put into leadership roles at your company for the same values. If you see a manager violating company practices, such as a policy against workplace relationships, intercede immediately to retain credibility with other workers.

Reinforce Consequences for Unethical Behavior

Business owners must hold their employees accountable when they act unethically. Start by informing new employees of the rules during their orientation sessions. Make sure all new workers know the consequences of policy violations. If an employee acts unethically, refer to the code of conduct and take the necessary measures to warn or terminate.

Show Employees Appreciation

Loyal employees feel that a company values the hard work they put into accomplishing tasks on a daily basis. A loyal employee is less likely to act unethically. Show appreciation to workers on a regular basis to encourage loyalty. Consider offering an extra day off per quarter or year to top performers or institute a bonus program in the sales division to reward hard work.

Welcome an Ethics Speaker

Schedule an ethics trainer to visit your work site to discuss ethical behavior and explain why it is important in organizations, regardless of the size or industry. Ethics trainers use role-playing, motivational speaking, videos and handouts to illustrate the importance of ethics in the workplace.

Create Checks and Balances

Rather than putting related responsibilities in the hands of one employee, create a system of checks and balances to minimize the opportunities for unethical behavior. For example, a sales associate rings up customer purchases, while an accountant balances the books to ensure that all payables are received and documented. Use an annual audit to verify established procedures are being followed and develop new policies to address any unique situations that arise during the year.

Hire for Values

When business owners hire employees, many seek to bring on individuals who have the education and experience that prove they are skilled workers, capable of handling the tasks at hand. Employers who want to prevent unethical behavior also look at candidates' values to ensure they mesh with the company's culture. Make sure a new employee believes in working diligently to earn a salary and are ready to comply with company policies.

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How can ethical violations be prevented?