Making sense of SABES results

In releasing the results of the 2013 South African Business Ethics Survey (SABES), Prof Deon Rossouw noted that most measures showed significant improvement over the three years since the 2010 survey. However, he noted that there was no significant shift in the ethical culture of companies, despite the advances in ethics management made over the last three years.

Prof Deon invited members to assist in making sense of an apparent discrepancy: “Why don’t we see changes in the ethical culture of organisations despite the increases in the effectiveness of ethics management programmes?” Perhaps I can make a small contribution to shed some light on the issue.

Firstly, we must understand the nature and meaning of organisation culture as a construct. Briefly, organisation culture (and thus an organisation’s ethical culture) can be summarised as “the way we do things in our organisation”, or “our accepted norms and standards of behaviour.” Although many different instruments exist to measure culture, there is not one instrument that exhaustively measures this “thing” called culture. In addition to what any culture assessment instrument will measure, culture also consists in terms of observed behaviours, actions and systems put in place, etc. Some aspects of culture are almost impossible to measure through direct survey questions as culture is also about those deeply held fundamental beliefs and assumptions about life, people, morality, etc. In organisations, these beliefs and assumptions sanction which behaviours are expected, allowed and rewarded in organisations, or which behaviour is punished or disallowed. As these beliefs, values and assumptions are held so deeply in the unconscious, any survey will most likely only yield results on what Edgar Schein calls “espoused values”, rather than the real values. The best way to study them is to observe their manifestations through behaviours, actions, decisions, formalised procedures, etc. In understanding or assessing organisational culture, one thus has to look wider than just results from the measuring instrument; one should also look holistically to the manifestation of culture in other ways.

Although the items in the measurement of culture in the SABES cover and assess many aspects of ethical culture, like other instruments it is also not an exhaustive measurement of ethics culture. Many manifestations of ethical culture are also measured by items under other headings in the report. For instance, in presenting the summary of the results, Deon mentioned
that:

  1. “The 2013 findings indicate that fewer incidents of misconduct were observed by employees in companies compared to the 2010 survey.”
  2. “Employees reported that they are experiencing less organisational pressure to engage in unethical conduct than in 2010”.

Both these findings are strong indicators of the manifestation of more ethical behaviour and expectations than before. As such, they are indicators of substantial changes and improvements of an ethical culture. These improvements could not happen unless there were positive changes in organisation’s ethical cultures to create the environment that would allow this to happen or prevent the contrary from happening. These findings could point to changes in fundamental beliefs and assumptions about what is expected or allowed as acceptable behaviour or punished and disallowed in organisations. Similarly, the finding that “compared to the 2010 survey fewer participants indicated that there are situations inviting unethical conduct in their companies” strongly indicates a positive change in ethical culture. It represents a significant indication of changes in what organisations accept as allowable business practices. It is only when ethical cultures of companies change and improve that people will experience fewer “invitations” to act unethically and ethical behaviour becomes a new norm.

In the summary of the results it is mentioned that “the survey also demonstrated a clear correlation between a strong ethical culture and positive ethical behaviour by employees. Employees are more likely to report unethical conduct and less likely to experience pressure to compromise ethical standard in companies with strong ethical cultures. They are also less likely to observe unethical conduct and generally feel better prepared to deal with difficult ethical situations.” This finding is somewhat of a tautology as the behaviours mentioned are inherently part of describing an ethical culture. If these improve, it can only be based on changes in what is expected and/or disallowed – in other words, positive changes in ethical culture.

One of the strong indicators of culture is what management is paying attention to and allocate scares resources to. According the SABES summary, there is “an increase in awareness of ethics programme elements, such as codes of ethics, ethics training and safe reporting systems.” This finding can be another strong indicator of a change in culture in that management is more willing (consciously or unconsciously) to allocate scarce resources, e.g., time and money, to ethics. As noted before, implemented actions are indicators of culture – what is really regarded as important by management is what ultimately gets done.

Culture is not something you can change by focusing on changing the culture; culture is the outcome of a complex mix of values, beliefs, behaviours, systems, processes, etc. As culture is institutionalised in formal systems, procedures, structures, etc., to change culture you also have to change these aspects. The comment is made in the SABES summary that “the findings demonstrate that the concerted efforts by companies to ensure that their ethics is managed effectively – as required by Principle 1.3 of the Third King Report – are paying off”. Arguably, this is another indicator of a change in ethical culture – especially if it is not done just for compliance reasons. However, even if this action is taken purely for compliance purposes, it is still a step in the right direction and through repetition and conditioning it is likely to have some positive (yet undeterminable) effect on an organisation’s ethics culture.

Culture is not static, but is always changing. Our impressions of, and expectations from an ethical culture are therefore not static and the goal posts continue to shift as we grow. When we make progress with improving an organisation’s ethical culture, people’s expectations regarding an ethical culture changes as they become more aware of what is happening and what the ethical culture could be. Before, people were “ethically blind”, but as they start to see, they develop a desire to see and have more of this good thing. On the other hand, with new expectations and improvements in ethical culture, a small deviation (which is part of life) is often experienced as a major catastrophe and a complete failure of the ethical culture, rather than a once off transgression by one person. This argument could explain some of the apparent discrepancies found through the survey.

In conclusion, the measure used in the SABES to assess ethical culture demonstrated some good validity in that it found a clear correlation between a strong ethical culture and ethical behaviour by employees. But perhaps its definition has a bit of a narrow focus as it does not cover the full extent of organisational culture, which manifests through many other aspects measured under other headings in the survey. One should just take note that it is good to have tension between the culture we experience and the ethical culture we aspire to. This creative tension is good as it keeps us on our toes and drives the striving to improve the culture even more. However, in our striving to always improve, this tension can overwhelm you or dump you into hopelessness if you do not keep track of where you came from and have a holistic and comprehensive perspective of the improvements made.

Dr. Mias de Klerk
Chief Ethics Officer: SASOL
21 August 2013