The keys to a positive business culture

This article considers integrity at the individual level as well as in terms of what companies can do to foster organizational environments in which people behave with integrity together.

By Joan Fontrodona & Pablo Sanz Fernández

On any given day, you don’t have to look very far to find some business making headlines for ethically questionable behavior. From high finance to the automotive sector, anywhere in the world, no industry or country is immune, even those once considered exemplary.

Unethical behavior is a serious matter with far-reaching consequences for those who engage in it. According to Socrates, to commit an injustice is to corrupt oneself. Or as the saying goes, if you play with fire, you get burned.

Yet it would be a mistake to consider ethics simply in terms of individual effects. After all, people live and act in communities, societies and the world. As such, you can neither ignore the impact of your decisions on others nor the influence of others on you. As evidenced by numerous scandals, unethical behavior drags everyone down together: employees, customers, suppliers, investors and stakeholders alike. Another feature worth highlighting about the social dimension of unethical behavior is the role of context, both that which facilitates or promotes the behavior and that which deters or penalizes it.

With this in mind, in this article we consider integrity not only at the individual level but also in terms of what companies can do to foster organizational environments in which people behave with integrity together, always mindful of the wider impact. Drawing on ethics research and our professional experiences working in the Center for Business in Society and the Department of Business Ethics at IESE, we argue that the best way of avoiding unethical behavior is not to define what not to do in a strictly legalistic sense, but rather to encourage the desired positive behavior that leads to greater integrity for all.

This article is published in IESE Insight Issue 27 (Q4 2015).

This content is exclusively for personal use. If you wish to use any of this material for academic or teaching purposes, please go to IESE Publishing where you can purchase a special PDF version of “The keys to a positive business culture” (ART-2789-E), as well as the full magazine in which it appears, in English or in Spanish.