Ethics in the Workplace Improved During the Recession

This article was written by Danielle

According to National Business Ethics Survey®, Americans in the workplace behave better in a down economy.
Seventy-eight percent of U.S. employees say they or their colleagues experienced the impact of the recession. Yet key measures of ethical behavior – the amount of misconduct observed, the willingness to report misdeeds, the strength of ethical cultures and the pressure to cut corner improved since the last survey in 2007, which was the beginning of the recession.

Fewer employees said they had witnessed misconduct on the job; the measure fell from 56 percent in 2007 to 49 percent in 2009
More employees said they had reported misconduct when they observed it; 63 percent in 2009, up from 58 percent in 2007
ERC’s measures of ethical culture in the workplace increased from 53 percent in 2007 to 62 percent this year – a positive sign
And overall, perceived pressure to commit an ethics violation – to cut corners, or worse – declined from 10 percent two years ago to 8 percent
Only retaliation against those who reported misconduct appeared to increase – a negative development

Hmmm, of course people will be on their best behavior. Nobody wants to get fired or laid off during this tight economy. My conclusion is supported by the fact that NBES data show that the improvements tend to be temporary and that management needs to stay alert as the economy gradually improves and businesses and other organizations return to business as usual.

NBES detected a similar pattern from 2000 to 2003, when the economy was rocked by the bursting of the dot com bubble, the events of 9/11 and corporate scandals including Enron, WorldCom, Tyco and Adelphia. ERC’s ethics metrics all improved during that period, only to fall back until the onset of the current recession in December 2007.

About 7 percent of workers said that they had observed instances of sexual harassment (down from 10 percent in 2007) but there was a 2-percentage-point increase, to 51 percent, in the number of people who reported it to superiors. Some 14 percent saw discrimination in the workplace, similar to 13 percent in 2007, but there was a 9-point gain, to 44 percent, in the number of people who reported it. Improper hiring practices remained the same from the previous year’s 10 percent but about 37 percent of those people reported it, a 4-percentage-point increase over the previous survey. Observations of stealing and theft, however, were at 9 percent, down 2 points from 2007 and reporting those incidents was down by 2 points, to 62 percent.

Among those who said they witnessed and reported unethical behavior this year, 15 percent said they experienced some form of retaliation, a 3-percentage-point increase over 2007. Retaliation ranged from physical abuse (4 percent) to verbal abuse by supervisors (55 percent) or peers (42 percent). Others said they were relocated or re-assigned, passed over for promotion and/or almost fired.