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Thu 1 Feb 2007 12:00 AM

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Choosing the right path

The Middle East should take ethics and social responsibility seriously, says Deborah Webster.

To companies like Barings and Enron, ethics and social responsibility are not things to be taken lightly.

These companies have learned the hard way that all it takes is a single individual or situation to bring down, not only an organisation, but a sector and potentially an economy. Ethics — making formal procedures, checks and balances — is something businesses in the region need to take very seriously.

When people think of ethics and social responsibility in the corporate context, they perceive it as a simple matter of determining what is right and wrong. As we do not live in a world where decisions are a matter of black or white but more in shades of grey however, steering the right course is not always a clear cut decision. Some say that doing the right thing is based on moral principle, while others believe it depends on the situation.

Every company in hiring executives seeks people with integrity and good moral standards, but how do these translate themselves to the corporate culture and how are the rules of the company’s code of ethics communicated?

It is not in calm seas that our character and integrity are tested but in times of crisis. It is at these times that mistakes are likely to happen. In the Middle East in particular, the topic of ethics and social responsibility should be treated with attention and focus, especially when one considers the diverse mix of nationalities working in the region. It is essential to ensure that ethics are clearly defined and communicated within the company. And you must ensure that individuals are aligned to those values. Just as each one of us is guided by our own internal compass of ‘the right path’, so too is every organisation.

The question is not whether an organisation has a value system, but rather how that value system is communicated in terms of formal policies and procedures, and a code of conduct. Sharing the value system of an organisation enables the individuals within it to look within themselves and align their values and subsequent behaviour with that of the organisation, making them stronger people and better corporate citizens. Making this a topic of continual attention in an organisation has a resultant impact on the level of openness, integrity and trust amongst colleagues. Research has shown that in organisations with such systems, people within the organisation are motivated to not only be stronger representatives but better enabled to handle turbulent times such as change or crisis management. Continual attention to ethics in the work place sensitises leaders and staff to how they want to act consistently. And this comes from the top – leaders who lead by example will set the tone for the whole organisation to follow.

Ethics programmes have also been shown to support employee growth and development. A study cited in the Wall Street Journal found a direct correlation between the level of emotional health of an executive and the results of a battery of tests on ethics.

Having ethics as part of the organisation’s agenda better prepares employees to face reality with the resultant effect that they feel more confident and ready to deal with whatever comes their way.

Another benefit is the impact ethics can have on a company’s public image if people perceive those organisations as valuing the manner in which business is conducted more than profit. Recent years have seen greater attention to this factor, with more companies reporting on their social responsibility and analysts making it part of their agenda in their valuation of company stock. When it comes to the region however, what are we giving back to our community and in the case of expatriates and foreign companies – our host country? How are we contributing to the sustainability and longevity of the local economy?

How are we ensuring that our actions have a positive contribution to the future of the region, the countries within it and its people?

Deborah Webster is a UAE-based senior associate at Korn / Ferry International, a global provider of executive human capital solutions.

“The question is not whether an organisation has a value system but rather how that value system is communicated in terms of formal policies and procedures.”

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