It has become fashionable at big corporations and banks to bring in ethics trainers--paid consultants who try to teach the workforce right from wrong.

In light of so many catastrophes--from insider trading at Goldman Sachs, to the sale of sub-prime mortgages everywhere--safety, it's argued, lies in showing employees where to draw the line.

It would be tempting to say that this is just a big business problem, but it isn't. The late, great business ethicist Rush Kidder once estimated that, in the U.S., 95% of high school students had cheated on exams or homework--but only 12% had ever seen anyone get caught. Cheating--in the form of plagiarism--has become so widespread both during college admissions and college itself that most educational institutions rely on plagiarism software--made by Turnitin--to scan for ideas, arguments, and text that has been borrowed or even bought.

So there is a very high likelihood that your employees have cheated at some point in their lives.

This is a chastening thought as you look around the office and see your staffers with heads down, hard at work. You're looking at an office full of cheaters. Or former cheaters.

High-profile cases--from Stuyvesant High School, to the withdrawal of Jonah Lehrer's book, Imagine--are easy to deride, but necessarily raise the question: How honest are the people around you? If even brilliant students and writers can go so far astray, what about everyone else?

There is, alas, no simple answer and I'm pretty sure that treating everyone like criminals isn't a constructive form of vigilance. Instead, I think back to a conversation I once had with Sherron Watkins, who was honest enough to draw CEO Kenneth Lay's attention to Enron's accounting problems. She drew two lessons from her experience working at a company where many had gone wrong:

1. Serial killers start with cats. Nobody creates a big crime out of the blue. They start with minor infractions that aren't punished and glean from that experience the lesson that the line is moveable and can be crossed. For companies, that means that acting on small transgressions is the best way to avoid big ones.

2. Community counts. The reason Watkins spoke up, she told me, is because she'd grown up in a small community where, if you saw something wrong, you did something about it. If a tree fell, you didn't walk on by, you called the Fire Department--because it was your town.

Entrepreneurs need to build companies where employees feels that it's their company, that what they do matters. You may, unwittingly, have hired a lot of people who have cheated at some point in their lives. But if you create an environment where it feels that cheating hurts something or someone they care about, your company's ethics may be in good shape. I have a pretty good idea that that culture will do more for your business than any ethics consultant.

Published on: Nov 7, 2012
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