Building an Ethical Firm Beginning With Human Resources
Building a firm based on ethical behavior is more important today than at any other time in history. Professional Services Firms are trusted advisors to their clients, and when events happen that “rock” that trust it is time for the firm to re-examine and re-commit it to operating in a way that will maintain the trusted advisor status with clients and the communities they work within.
Many firms have begun the process of evaluating their firm to make and changes necessary to ensure they won’t be the next one caught in a costly scandal. People are the mainstay of our business and because of that, a good place to begin the evaluation of your firm is in the area of Human Resources. Let’s explore a few areas to get started.
Hire right
Use behavioral-based interviewing techniques. It’s easy to be blinded by a candidate’s stellar credentials. Today, more than ever, it’s important for hiring managers to “get behind the resume.” Using an approach like behavioral-based interviewing allows interviewers to see what makes a candidate tick.
Behavioral-based interviewing is based on the premise that behaviors are formed over time and that if employees have done something in the past, they’re likely to repeat it in the future. Therefore, candidates are asked to describe how they actually handled situations in the past. Take, for example, a person who alerted management that an extra $100 was mistakenly direct-deposited into his or her account. He or she is likely to behave honestly on the job.
Firms who implement this type of interviewing program throughout their organization see a dramatic increase in the quality of their hires. Perhaps Enron would still be standing today if they had done a better job of hiring a different caliber of staff.
Pay attention to attitude
In the past, you most likely have interviewed candidates for your firm who might have become quite defensive when you ask them probing questions about a claimed skill, credential, or competency on their resume. More than likely, these candidates don’t have the claimed skill and are trying to bully their way out of a tight spot.
Perhaps the candidate does, in fact, have the claimed credentials. You then have to ask yourself if you really want someone in your organization with that kind of attitude. Some of your employees may not be strong enough to confront an individual like this on issues surrounding ethics. Instead, they may choose to be silent or tell someone outside the firm.
Review personnel policies
Review your personnel policies, particularly as they relate to the hiring of family members. Employees may find it extremely difficult to blow the whistle on the unethical behavior of a relative if they sense that this action will put a family member’s job in jeopardy.
Implement a written code of ethics and business code of conduct for your firm, regardless of its size. Establish core values, guidelines, and practices that the firm would like the employees to follow and include this in your employee handbook. For example, be specific about the acceptance of gifts from vendors. Put a dollar amount on what employees can spend when wining and dining clients.
Establish a reporting system
Establish a system in your firm where employees can confidentially report unethical work behavior. Ways to do this include installing your own hotline or contracting with an outside firm to provide these services for your firm.
Communicate effectively and train
When it comes to ethics, the line in the sand appears to be continually moving. Business owners, executives, and leaders need to communicate continuously with employees about their firm’s governing principals and beliefs. They should also provide on-going training that includes opportunities for employees to practice responding to real-life ethical dilemmas.
Develop internal training from the top down
Developing a training program that is mandatory for all owners, managers and staff is imperative for firms today. Owners should not only endorse the training, they should take part in the presentation of materials and be involved in the training course as a participant. When owners show their support it will be far more effective throughout all levels of the firm.
Developing a workplace where ethics and second nature takes time, but taking the time is well worth your while. Businesses that can convince stockholders, customers, and employees that they are ethically grounded will have a strong competitive advantage in the marketplace.
