Ethical lapses abound in post-SOX era
Photo by KungPaoCajun
There has been a huge emphasis on corporate ethics ever since the Sarbanes-Oxley Act was enacted in 2002. There is some question, though, whether all of that attention is having the desired effect.
A new study from the Ethics Resource Center indicates that unethical behavior continues to plague corporate America. Among the study's findings:
- Fifty-six percent of employees surveyed say they have personally observed violations of company ethics standards, policy or the law, but 42 percent did not report the misconduct.
- Fifty-four percent of those who witnessed unethical behavior but did not report it believed that reporting the misconduct would not lead to corrective action, and 36 percent feared retaliation.
"The good news," said ERC President Patricia Harned, "is that the rate of misconduct is cut by three-forths at companies with strong ethical cultures and reporting is doubled at companies with comprehensive ethics programs."
CPAs have played a leading role in focusing attention on corporate ethics in recent years. In fact, Maryland CPAs are required to devote at least four hours of continuing education every two years to ethics training. Check out some of available courses here.
The ERC's study seems to indicate that such training is essential if corporate America hopes to rid itself of unethical behavior. The more focused you and your employees are on doing the right thing, the study claims, the less likely you are to suffer unethical setbacks.
What is your company doing to discourage unethical behavior and, equally important, to encourage employees to do the right thing?