ethics training and education dr. margaret mckee sobey school of business saint mary’s university...
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Ethics Training and Education
Dr. Margaret McKeeSobey School of Business
Saint Mary’s University February 6, 2014
An Investigation of the Practices ofTop Canadian CompaniesResearch sponsored by the Canadian Centre for Ethics in Public Affairs
Agenda• Overview of Proposed Research
– Literature Review
– Local Research Context
– Research Purpose
– Research Questions
– Research Approach
• Findings– Survey Results
– Interviews Themes
• Conclusions
Research Purpose
• To gain a detailed understanding of the ethics education and training practices of leading Canadian companies.
• Focus on those deemed “best” in the country– i.e. Progress’ Top 101 Companies and Globe
and Mail Top 1000 companies
Research Questions
• What are Canadian organizations doing relative to ethics
education and training?
• What methods are they using to deliver educational and training programs?
• When is such training and education being done? Is it done primarily when employees join the organization? Is there also ongoing training and education?
• Who is receiving the training? Are there employees or positions that are specifically targeted for training? Is their training all the same?
• What are the specific aims of the training? Is the focus primarily on making employees aware of the organizations’ codes of conduct and/or ethical rules and regulations? Alternatively, is there more of an emphasis on developing more of a culture of ethical behavior?
Literature Review Ethical values, responsibility and accountability rated as some of most
important employee behaviours, but new employees are sometimes lacking in these areas (e.g., Cacioppe, Forster, & Fox, 2008; Hall & Berardino, 2006; Otter, 2003; Tanyel, Mitchell, & McAlum, 1999).
Research has shown organizations can use ethics training and education to address such deficiencies and help employees:◦ identify ethical scenarios, ◦ appreciate more fully the dimensions of ethical dilemmas, ◦ enhance their moral reasoning and judgment◦ increase their attentiveness to ethical challenges
(e.g., Gautschi & Jones, 1998; Grant, 2008; Halbesleben, Wheeler, & Buckley, 2005; McWilliams, & Nahavandi, 2006; Sims & Sims, 1991).
Research suggests ethical thinking and ethical behaviours must be nurtured over time and over one’s career (Sims & Felton, 2006)
Local Research Context
• Sobey/Progress Survey (Driscoll & McKee, 2005)
– Little formal ethics training being done by Atlantic Canadian firms in the workplace
• Less than 5% of Progress Top 101 companies completing the survey reported having any training in 2004; 6% in 2003
• 50% of firms reported having formal code of ethics• 55% reported having mechanism for
whistleblowing
Local Research Context
• Interview Study (MacInnis & Driscoll, 2009)
– Seventeen out of 18 Atlantic Canadian senior managers responded they believe business and ethics are integrated:
– “Some businesses operate ethically, some operate very ethically, and some operate without ethics.” [P9]
– “When operating with full disclosure, it is important to think about long term sustainability and stakeholders. There has to be a high degree of thinking about [ecological] sustainability to thrive in Atlantic Canada.” [P18]
Local Research Context
• Majority of respondents reported university course work was useful, but insufficient to prepare employees for ethical challenges in workplace:
– “Coursework can help, but certain components have to come from within the individual.”
– “[Ethics education] …helps, but what is learned in the workforce is just as or more important.”
– “Most [graduates] are more prepared for ethical challenges, but do not have a strong understanding of the complexities in the workforce.”
– “It is experience not education that allows you to act [on] grey situations.”
Research Methodology
• Mixed-Method Approach– Study 1 – Survey of Training/Education Practices
• Email survey to leading Canadian firms to quantify:– Current practices in terms of training aims, delivery methods,
timing, frequency, and recipients– Differences related to organizational size or focus– Instrument modeled after Sekerka (2009).
– Study 2 – In-depth Assessment of Practices• Interviews with HR professionals of “Top 101 Companies”
who completed survey to explore:– Rationale for use of specific practices over others– Perceived challenges and wish-list for additional ethics training
and education
Study 1 – Survey Findings
• Surveys completed by 253 firms but 30 were lacking data on size
• Final sample: 223 usable surveys– Size: 13% small, 30% medium, 56% large– Unionized: 28%– Industry Sector:17% forestry, fishing, mining and oil & gas;
14% manufacturing; 13% finance, insurance and real estate, 8% health care and social services and 7% professional services and sciences
– Firm Location: 19% Atlantic Canada, 55% Central Canada, 26% Western Canada
– Ownership: 52% publicly-traded, 27% privately held– Head Office: 84% in Canada
Findings from Survey Analysis
• Firms making investments in training as part of an overall strategic human resource are more likely to conduct ethics training.
Variables Model 1
Small Business -.621** (.288)
Medium Business -.217 (.245)
Atlantic Canada -.746** (.285)
Western Canada -.835** (.274)
Industry -.030 (.232)
Public Company .699** (.253)
Location of Head Office .044 (.309)
SHRM Training .492** (.122)
Chi-Square 55.20 **
Pseudo R2 .200
N 223
Table 2: Probit Analysis of the Provision of Business Ethics Training
Note 1: standard errors are in parentheses.Note 2: *p<.05. **p<.01
Findings from Survey Analysis
Variables Model 1
Small Business -.621** (.288)
Medium Business -.217 (.245)
Atlantic Canada -.746** (.285)
Western Canada -.835** (.274)
Industry -.030 (.232)
Public Company .699** (.253)
Location of Head Office .044 (.309)
SHRM Training .492** (.122)
Chi-Square 55.20 **
Pseudo R2 .200
N 223
Small businesses were less likely to provide ethics training.
Ethics training less likely in Atlantic and Western regions of Canada.
Publicly-traded companies had a higher probability of providing ethics training.
Table 2: Probit Analysis of the Provision of Business Ethics Training
Note 1: standard errors are in parentheses.Note 2: *p<.05. **p<.01
Descriptive Results – Ethics Training
• 89 firms or 35% reported having training.
• Timing of Ethics Training Introduction:• 18% 10 years ago or more• 26 % 6 years ago• 46% 3 years ago
• Top Reasons for Introducing Training:• 36% desire to ensure consistent culture and values• 24% ensure compliance with rules/regulations
• Responsibility for Ethics Training• 48% HR staff• 27% Operations staff
Descriptive Results –Training Activity
• Internal Stakeholders Targeted for Training • 93% All employees• 25% Supervisors/Senior Managers Or Senior Management• 16% Board of Directors
• External Stakeholders Targeted for Training • 28% Business Partners; • 18% Suppliers• 16% Vendors
• Timing of Business Ethics Training• 44% As part of new employee orientation • 40% On an annual basis
Descriptive Results –Training Delivery Focus of Ethics Training
• 65% Company values and expected ethical behavior • 35% Company rules and regulations
Primary Delivery Methods:• 35% Combination of face-to-face and self-study • 30% Face-to-face only • 27% Self-study with on-line materials
Instructional Techniques and Aids:• 39% Practice ethical decision making • 38% Participant sharing • 62% Ethical scenarios and mini-cases • 39% Videos with ethics focus
Descriptive Results – Ethical System
Presence of Supporting Ethics Program Elements• 81% Require employees to sign a code of conduct • 28% Distribute code annually • 60% Whistle blower system in place • 35% Conduct formal risk assessments • 30% Designated ethics officer
Pro-active Formal Communications on Ethics Topics• 13% Articles in employees newsletter • 10% Employee meeting agendas• 15% Company conferences/events• 7% Special ethics related communications
Descriptive Results – SHRM Integration
• Ethical Character Considered in Hiring/Promotion Decisions • 27% Employee Selection • 29% Performance Evaluations• 21% Executive Succession Planning
• Ethical Climate and Culture Assessed in Employee Feedback Mechanisms• 38% Employee surveys • 18% Request feedback on ethics materials • 37% Exit interviews
Study 2 – Interview Findings
• Interviews conducted with 15 participants from the survey study– Participants were primarily Human Resource
Professionals from NS, NB and NL• Representing 13 industries
– Included firms from manufacturing, agricultural, automotive, construction, food and beverage, insurance, IT and communications, mining and energy, real estate, retail, and transportation
• Number of employees ranged from 35 to 5,000 +• Revenues ranged from $8 million to $2.7 billion
Study 2 – Interview Findings
• Semi-structured interviews ranging from 10 to 53 minutes in length– Majority of interviews were conducted in
person, allowing for prolonged conversations and non-verbal cue observation
• Interviews were transcribed for coding– Open-system coding was utilized, per Strauss
and Corbin (1998), to discover key themes within the data
Study 2 – Interview Findings
• Few Firms Conducting Ethics Training– Predominant response from all companies was “no”;
they are not conducting training
• Senior executives seen as drivers of any existing ethics commitment- “It comes right from the top”, and “Yes it is a priority for
senior management. It comes right from the top down
- “It starts with the principal shareholder of the company …..so their personal ethics are those which the rest of the company must abide by”
Study 2 – Interview Findings
• Ad hoc Approach to Organizational Ethics Most Common– When asked if their organization placed an emphasis
on ethics, all respondents answered yes. However, when questioned about the specifics, most found it challenging to articulate anything concrete.
– Specific policies were often not mentioned.
Study 2 – Interview Findings
• Hiring Practices Seen as Key to Ensuring Ethical Culture– Several respondents stated that sound employee
selection processes promote ethical work environments and therefore training should not be necessary.
– One participant strongly questioned the need for ethics training; his justification being that “You have to find the right people to begin with” and “If you breathe that ethical culture’, that’s what you get.”
Study 2 – Interview Findings
• Overall Lack of Collaboration/Coordination– No participants mentioned collaborating with
other firms or organizations on ethics training.
– Several participants thought industry groups might be able to offer assistance in this area through templates and other materials.
Conclusions
• Overall our findings suggest that firms in Canada are lagging behind the United States in terms of providing ethics training. – Western and Atlantic Canadian companies trail their
Central Canadian counterparts.
– Results for Atlantic firms little changed from 2003/04 studies of “Top 101” firms
– However small/medium firms and those with different business models, i.e. co-ops, seem to be taking a more pro-active approach to ethics training in Atlantic Canada
Conclusions
• Participating firms primarily targeting internal stakeholders and conducting training as part of new employee orientation– Focus on ensuring employees were aware of
organizational values and desired behaviour as opposed to rules and regulations.
– HR professionals playing a key role
• More training being conducted face-to-face using a variety of instructional approaches– Ethical decision making exercises, role playing, ethical
scenarios/cases and videos most popular.
Conclusions
• Training often being supported with other ethics program elements– E.g. code of ethics or whistleblower system
• Most firms doing a basic evaluation of ethics training, but a surprising number conducting more sophisticated evaluations.
• Few organizations reported significant ethics integration with key strategic HR practices, although interview participants suggested this was how firms were addressing the issue
Conclusions
• Consistent with previous research, lack of internal expertise, time constraints, limited financial resources and no perceived need by organizational leaders were most commonly identified as reasons for lack of training
• Small businesses seem to be particularly challenged to provide ethics training– Potential opportunity for third parties to build
resources for ethics training and development
