BUILDING AN ETHICAL ECOSYSTEM TO SUSTAIN EMPLOYEE VOICE

Leadership at the highest level is necessary if organizations are to get back in step with current public opinion. 'Tone at the top' is a key deter- minant of whether employees are free to speak up (Sekerka, 2009), so the first step in empowering employee voice is for leaders to evaluate the existing organizational culture. Research has found that over 40 per cent of companies have weak cultures that fail to support ethical behaviour and self-correction (ERC, 2012). Some cultures actually foster unethical behaviour either knowingly or unwittingly. A study of senior financial professionals in the United States and the United Kingdom revealed that 30 per cent of financiers believed that their company's reward system incentivized them to violate ethical and legal standards (LabatonSucharow, 2012). Kish-Gephart, Harrison, and Trevin˜ o's (2010) meta-analytic review of thirty years of ethics studies found that environ- ments that reward individualistic behaviour are more likely to foster unethical behaviour. Similarly, VanSandt, Shepard, and Zappe's (2006) study of seven different organizations found that individualistic and com- petitive organizational cultures were also associated with lower levels of employee moral awareness. In contrast, work cultures which emphasized high ethical principles and benevolence were related to higher levels of employee moral awareness. VanSandt et al. (2006) concluded that an organization's culture exerts a more powerful influence on employee beha- viour than either the individual's personal moral standards or any ethics training programmes. These results suggest it is critical for managers to examine whether their organizational policies and procedures support or suppress employee voice and whether their incentive system encourages ethical conduct or its oppo- site. The challenge for leaders is to create a safe and ethical culture of trust that empowers employee voice and makes it safe to report misconduct. Bennis, Goleman, and Biederman (2008, p. 32) recommend building a 'culture of candor' where leaders 'show that speaking up is not just safe but mandatory, and that no information of substance is out of bounds … failing to hear critical information, and whoever delivers it, may put the entire enterprise at risk'.

Systems theory describes organizations as complex environmental sys-

tems, where the system parts (policies, processes, actors and actions) all exert reciprocal impacts on each other. Undoubtedly, organizations can train their employees to develop moral awareness, moral decision-making, moral courage and moral action, but for this training to transfer beyond the training room, the organization also needs to create a sustainable cul- tural ecosystem that empowers, nurtures, listens to and rewards employees who practice moral behaviours and who speak up about misconduct. Such a system must be sanctioned at the top by the Board and senior execu- tives, supported by middle management and frontline supervisors and embraced by all levels of the organization (Nunez, 2012). To be effective, the ethical tone and behaviours must permeate from the top, down through the middle, to the bottom of the organization, and back up again (see Fig. 1). Bottom up Board & Executives Top down

*Speak up without fear

*Seek feedback

*Encourage others to speak up

*Role model speaking up

*Support those who speak up Middle managers *Articulate a code of conduct

*Role model ethical conduct

*Be safe and trustworthy

*Foster two-way communication

*Listen responsively

*Reward speaking up

*Act on reports and provide feedback on results

*Censure wrongdoing

*Celebrate success stories Employees

Fig. 1. Building an Ethical Ecosystem. To create an ethical culture, management needs to set in place the necessary organizational structures (policies, procedures and processes) to ensure that it is truly safe for their employees to speak up freely. Our suggested plan for creating a structure to sustain a safe ethical culture includes:

• Creating an ethics code of conduct.

• Providing training for code of conduct awareness.

• Providing training to reframe attitudes to whistleblowing.

• Creating mechanisms for getting advice/support.

• Providing management training in listening skills and response.

• Providing training for moral courage and voicing values.

• Providing multiple reporting channels, including anonymous hotlines.

• Establishing investigative and corrective action protocols.

• Providing feedback on actions to the reporter and the organization.

• Rewarding and celebrate speaking up; reward management listening and action.

• Including speaking up and allowing voice in KPIs for performance

appraisal.

• Quarterly reporting of employee voice and resulting actions.

These structural elements are essential to create a healthy and safe ethical ecosystem that builds and sustains trust and candour in the organi- zation. The provision of adequate channels for speaking up is necessary to encourage employee voice. Approachable, trustworthy managers, suppor- tive work groups and anonymous hotlines and websites are all important channels of communication (King, 1999). To encourage speaking up, man- agers need to consider providing incentives for employees who voice valid concerns. Research has found that companies that reward employee voice, even by a simple gestures such as a handwritten note of appreciation or a commendation in a performance review, record more reporting of wrong- doing (ERC, 2012). Feedback to the reporter on any resulting actions in response to a report, and ongoing auditing of the system is necessary to ensure the sustainability of a safe ethical culture.

However, simply knowing the organization's code of ethical conduct

and being aware of expected behaviours and available reporting channels is not enough to guarantee that employees will actually speak up about per- ceived misconduct. Rules and regulations provide a framework for ethical action, but not the means to produce ethical strength (Sekerka, 2014), or the moral competencies that underpin identifying and voicing concerns about observed misconduct. Healthy organizations go beyond the moral Fig. 2. Training Initiatives to Develop and Sustain Employee Voice.

minimum and make a concerted effort to build moral fortitude and ethical strength into the fabric of their culture and operations. Effective training is necessary to ensure the ethical ecosystem functions smoothly. Training employees' awareness of their organization's ethical policies, procedures and processes is essential to ensure that employees are able to recognize ethical breaches. In addition, training is necessary to change organizational attitudes to employee voice so that employees feel encouraged to speak up. Training is also necessary to teach employees how to give effective voice to their concerns so they are heard, and how to respond appropriately when others voice their concerns. The remainder of this chapter will focus on four key areas of training to help foster employee voice, as shown in Fig. 2.