BOOK REVIEW / Ethics for people like us: Making the Right Decision, Ethics for Managers - William D Hall: John Wiley & Sons, dollars 14.95

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The Independent Online
According to William D Hall, 'too many people think there's no ethical issue unless someone is caught with his hand in the till'.

Hall, a former partner with Arthur Andersen, the accountants and management consultants, challenges that view by contending that ethics is the way in which people behave towards one another, and is therefore intertwined with decisions companies make every day.

His book is based on the lessons learnt in a five-year business ethics programme set up by the Arthur Andersen Worldwide Centre for Professional Education in St Charles, Illinois. The purpose was to integrate ethics more fully into the curricula of US business schools, and the book is written as a fictitious extended case study.

It describes how the board of the Hauser-Moore Manufacturing Company has been bulldozed by an enthusiastic chief executive into a decision to relocate part of its operations. Nothing illegal or obviously immoral has taken place. But on reflection, a number of concerns - such as worries about whether the financial calculations were done properly or everybody with an interest in the business was consulted - are raised about the way the decision has been made.

Guided by the author, in the persona of ethical consultant Carl Iverson, a series of discussions address basic questions, such as 'How do you define ethics?', 'Why focus on business ethics - if someone has strong personal ethics, isn't that enough?', 'Can't we deal with legal compliance without a philosophical background?' and 'How does a company decide what is right?'

But, as Iverson explains, 'ethics is more than a matter of right and wrong'. Good people as well as those who might be considered evil have to deal with it. The consultant presents a seven- step approach for dealing with ethical dilemmas from the point of view of company decisions - a consideration of rights and obligations, benefits and costs in conducting the business of the company. But the next step is looking at individual decisions, and as he points out, 'dealing with individual problems . . . can be more difficult. The person feels exposed, almost naked.'

This process leads to some tough soul-searching, as board members develop increasing awareness of the relevance of ethics to their everyday business problems. 'I'm beginning to see how much good ethics is tied up with good business. It's certainly not the either/or situation many people assume,' says one.

Hall concludes with a clear exposition of the components of an effective corporate ethics programme. This includes creating the environment, with a statement of values, building on the corporate tradition, and ensuring that the tone at the top - which he likens to 'body language' - is correct. Then the programme has to be implemented, with a code of conduct, procedures, training, a hot line and continual monitoring.

This highly readable book presents the issues in a way that is clearly relevant to everyday business life. It is easy to identify with many of the situations discussed. What is less easy to believe is that a British company would take this approach to managing them. Scepticism and complacency still reign in too many UK boardrooms.

While 43 per cent of firms responding to today's ethics survey by the consultancy Integrity Works and Ashridge Management College have a code of ethics, few - if any - would claim to have a programme as comprehensive as that advocated by Hall. There is a phenomenon known to business ethics practitioners as 'moral muteness', which consists of denial that problems are ethical, or that ethical problems exist, and unwillingness to discuss even the simplest issues in ethical terms.

The question 'What would a secretary in your company do if she found her boss was cheating on his expenses?' caused one recently interviewed British chief executive to draw a deep breath and pause, before replying: 'That just does not happen in this company. It is a totally hypothetical question.'

Concern for ethics is often seen only in the context of scandals - of rank, gross misbehaviour. But the point crucially made by Hall is that 'almost any irregularity of any size requires the passive acceptance, the looking the other way, if not the active participation, of other people - people you and I would regard as honest - even people like us'.

In a society where my word can no longer be assumed to be my bond, companies that take ethics seriously and put an effective corporate programme in place will find themselves ahead of the game when it comes to preventing corporate tragedy.

An ethics programme can also have positive benefits in supporting the management of change. These, however, were not this book's remit. It is a thought-provoking aid to integrating ethical components into a decision-making process. The approach it recommends is some way ahead of anything currently happening in the UK. Read it and learn.

(Photograph omitted)