The E&C Pulse - December 18th

December 18, 2018 Ben DiPietro

People Looking to Businesses for Ethical Leadership

profile_pics_5As people lose trust in government institutions, they appear to be looking to the business community to lead the way on ethics and good behavior, a survey of U.K. residents suggests.

The Institute of Business Ethics every years asks U.K. residents about how much they think companies conduct themselves ethically. This year 62% of respondents said they do, the second straight year of increase.

It's the highest percentage since the survey was first conducted in 2003, when 47% said they trusted business. Fewer than one in three (30%) said they don't think business acts ethically.

The fact more than two times as many people trust businesses than don't may be the result of an increased perception of uncertainty with regard to the current political situation, particularly influenced by Brexit negotiations, the Institute said. 

Opinion polls of the British public conducted by Ipsos MORI found confidence in current political leaders is decreasing and people don't seem to trust the government to reach a good Brexit deal, said Philippa Foster Back, the Institute's director.

As global political uncertainty overshadows much of the news, businesses in contrast seem to offer stability and appear more responsible in the eyes of the public, she said. 

"Given this situation, people might see business as better prepared and better equipped to tackle uncertainty," said Back. “Business also appears to be becoming more proactive in recognizing issues of concern for the public, and going further than the law, for example, in addressing environmental concerns." 

There is a generation gap when it comes to views on businesses, with Millennials more approving of companies than Generation X or Baby Boomers. The survey found 24% people aged 18-34 think businesses are unethical, down from 36% who said so last year. Thirty-two percent of Gen Xers said businesses are unethical, while 36% of Boomers think so.

Social media may account for some of this generational difference, said Back. "Social media means that consumers can see that they are able to have an impact on business decision-making, where they may feel powerless to influence governments,” said Back.

Also, the the aging population and a new generation entering the workforce are creating new opportunities and challenges for employers, especially in relation to embedding business ethics, said Back. There is a significant amount of research that supports the idea that there are large differences in assumptions, personality and management characteristics between different age groups.

"Shaped by common traits that characterized their upbringing and the social context in which they grew up, each generation has developed its own emphasis on particular ethical standards and a unique understanding of what is appropriate and ethical in the workplace," she said.

For example, the survey showed issues such as privacy and work-home balance are perceived differently by different generations. And there are several studies that show how Millennials seem to have higher expectations for companies to deliver more social and environmental change and work more collaboratively to tackle global issues than ever before.

"Brexit might have had an impact on generational differences in terms of trust in business as well: analysis of the Brexit vote illustrates that Millennials are overall more likely to have voted remain, and so they might be more likely to feel disappointed by the current political situation and therefore look at business as the main driver of stability, said Back.

"Business is increasingly held accountable for its behavior in society," she said. "The public expects business to deliver social change, a role that in the past was considered to be in the government remit."

While trust is strong, respondents listed areas where business still needs to improve. One-third of people listed tax avoidance as the top issue, 24% said executive pay, the same top two issues as 2017, IBE said. Environmental responsibility tied executive pay at 24%, and work-life balance right behind at 23%.

"The public remains skeptical that business is just operating for itself, as they see tax avoidance and remuneration as still the top issues which they think business needs to address," said Back.


Ben DiPietro



A survey of British people by the Institute of Business Ethics found 62% of people in 2918 have trust in business, up from 47% when the group conducted its first survey in 2003. Thirty percent of respondents believe businesses act unethically.


Saying he violated company policy and tried to impede an investigation into his alleged sexual misconduct, the board at CBS voted to strip ousted Chief Executive Les Moonves of his $120 severance package, Associated Press reports. Moonves could contest the decision, The New York Times reports.

Citing internal documents and other information, Reuters reports Johnson & Johnson executives for decades knew and tried to hide the fact its talc products contained asbestos. The company denies it either knew or tried to hide information.

Nissan's board of directors didn't choose a replacement Monday for ousted Chairman Carlos Ghosn, who is charged with underreporting his income in Japan, Associated Press reports. 

Quotas to mandate board diversity by themselves won't make boards more diverse, Kiersten Barnet writes in Fast Company.

Compliance Week touts the biggest business ethics failures of 2018.

Crisis manager Richard Levick offers advice to companies on how to respond to the rise of employee activism.

Harvard Business Review looks at how unethical behavior can occur when competition between employees goes too far.

Hedge fund Paulson & Sons swayed shareholders of Detour Gold Corp. to remove most of its board of directors, which includes the company's interim CEO, the Toronto Star reports.



Take our 2019 E&C Effectiveness Survey to provide data-driven insights that we will share in our annual report early next year. Everyone who completes the survey by January 1, 2019 will receive a complimentary LRN training vignette about conflicts of interest. 



Learn the 4 words you need to know in 2019. Two of LRN’s advisory experts, Dr. Marsha Ershaghi Hames and Susan Divers, share their thoughts on what ethics and compliance managers should be thinking about in the coming year. 


Previous Post
The E&C Pulse - December 20th
The E&C Pulse - December 20th

Ben DiPietro explores the role of bystanders in reporting harassment, and how firms can better train on thi...

Next Post
The E&C Pulse - December 13th
The E&C Pulse - December 13th

Ben DiPietro dives into a survey of corporate directors and their views on culture and diversity. Also, LRN...


Subscribe To LRN's E&C Pulse Newsletter

First Name
Last Name
Company Name
Job Title
Thank you!
Error - something went wrong!