The document provides a historical overview of business ethics from ancient times to present day. It discusses the evolution of business ethics as an academic discipline since the 1960s and highlights some of the major ethical dilemmas and developments within each decade. Business ethics has grown from being focused on legal compliance to embracing values and addressing globalization challenges over the past 50 years.

1. Business
Ethics
Tathagat
Varma
Session
2/12:
23-­‐Jul-­‐09

2. History
• Probably
as
old
as
trade
itself
!
• The
Code
of
Hammurabi
(1700s
B.C.),
prescribing
prices
and
tariffs
and
laying
down
both
rules
of
commerce
and
harsh
penalMes
for
noncompliance,
evidences
some
of
civilizaMon's
earlier
aQempts
to
establish
the
moral
contours
of
commercial
acMvity.
• Aristotle's
Poli&cs
(300s
B.C.)
addresses
explicitly
commercial
relaMons
in
its
discussion
of
household
management.
• Judeo-­‐ChrisMan
morality,
as
expressed
in,
e.g.,
the
Talmud
(200
A.D.)
and
the
Ten
Commandments
(Exodus
20:2-­‐17;
Deuteronomy
5:6-­‐21),
includes
moral
rules
applicable
to
commercial
conduct.

3. Today
• As
a
discrete,
self-­‐conscious
academic
discipline,
business
ethics
is
roughly
four
decades
old.
• Raymond
Baumhart's
(1961,
1963,
1968)
groundbreaking
studies
in
the
1960s
are
generally
understood
to
be
early
contribuMons
to
business
ethics.
• Richard
DeGeorge
(2005)
dates
academic
business
ethics
to
the
1970s,
idenMfying
Baumhart
as
a
forerunner
to
a
self-­‐conscious
academic
business
ethics.
• Prominent
contemporary
business
ethicist
Norman
Bowie
dates
the
field's
first
academic
conference
to
1974
(DeGeorge
2005).

4. 1960s
• Ethical
Climate
– Social
unrest.
AnM-­‐war
senMment.
Employees
have
an
adversarial
relaMonship
with
management.
Values
shi`
away
from
loyalty
to
an
employer
to
loyalty
to
ideals.
Old
values
are
cast
aside.
• Major
Ethical
Dilemmas
– Environmental
issues
– Increased
employee-­‐employer
tension
– Civil
rights
issues
dominate
– Honesty
– The
work
ethic
changes
– Drug
use
escalates
• Business
Ethics
Developments
– Companies
begin
establishing
codes
of
conduct
and
values
statements
– Birth
of
social
responsibility
movement
– CorporaMons
address
ethics
issues
through
legal
or
personnel
departments

5. 1970s
• Ethical
Culture
– Defense
contractors
and
other
major
industries
riddled
by
scandal.
The
economy
suffers
through
recession.
Unemployment
escalates.
There
are
heightened
environmental
concerns.
The
public
pushes
to
make
businesses
accountable
for
ethical
shortcomings.
• Major
Ethical
Dilemmas
– Employee
militancy
(employee
versus
management
mentality)
– Human
rights
issues
surface
(forced
labor,
sub-­‐standard
wages,
unsafe
pracMces)
– Some
firms
choose
to
cover
rather
than
correct
dilemmas
• Business
Ethics
Developments
– ERC
founded
(1977)
– Compliance
with
laws
high-­‐lighted
– Federal
Corrupt
PracMces
Act
passed
in
1977
– Values
movement
begins
to
move
ethics
from
compliance
orientaMon
to
being
"values
centered"

6. 1980s
• Ethical
Culture
– The
social
contract
between
employers
and
employees
is
redefined.
Defense
contractors
are
required
to
conform
to
stringent
rules.
CorporaMons
downsize
and
employees'
ahtudes
about
loyalty
to
the
employer
are
eroded.
Health
care
ethics
emphasized.
• Major
Ethical
Dilemmas
– Bribes
and
illegal
contracMng
pracMces
– Influence
peddling
– DecepMve
adverMsing
– Financial
fraud
(savings
and
loan
scandal)
– Transparency
issues
arise
• Business
Ethics
Developments
– ERC
develops
the
U.S.
Code
of
Ethics
for
Government
Service
(1980)
– ERC
forms
first
business
ethics
office
at
General
Dynamics
(1985)
– Defense
Industry
IniMaMve
established
(1986)
– Some
companies
create
ombudsman
posiMons
in
addiMon
to
ethics
officer
roles
– False
Claims
Act
(government
contracMng)

7. 1990s
• Global
expansion
brings
new
ethical
challenges.
There
are
major
concerns
about
child
labor,
facilitaMon
payments
(bribes),
and
environmental
issues.
The
emergence
of
the
Internet
challenges
cultural
borders.
What
was
forbidden
becomes
common.
• Major
Ethical
Dilemmas
– Unsafe
work
pracMces
in
third
world
countries
– Increased
corporate
liability
for
personal
damage
(cigareQe
companies,
Dow
Chemical,
etc.)
– Financial
mismanagement
and
fraud.
• Business
Ethics
Developments
– Federal
Sentencing
Guidelines
for
OrganizaMons
(1991)
– Class
acMon
lawsuits
– Global
Sullivan
Principles
(1999)
– In
re
Caremark
(Delaware
Chancery
Court
ruling
re
Board
responsibility
for
ethics)
– IGs
requiring
voluntary
disclosure
– ERC
establishes
internaMonal
business
ethics
centers
– Royal
Dutch
Shell
InternaMonal
begins
issuing
annual
reports
on
their
ethical
performance

8. 2000s
• Unprecedented
economic
growth
is
followed
by
financial
failures.
Ethics
issues
destroy
some
high
profile
firms.
Personal
data
is
collected
and
sold
openly.
Hackers
and
data
thieves
plague
businesses
and
government
agencies.
Acts
of
terror
and
aggression
occur
internaMonally.
• Major
Ethical
Dilemmas
– Cyber
crime
– Privacy
issues
(data
mining)
– Financial
mismanagement.
– InternaMonal
corrupMon.
– Loss
of
privacy
-­‐
employees
versus
employers
– Intellectual
property
the`
– The
role
of
business
in
promoMng
sustainable
development
• Business
Ethics
Developments
– Business
regulaMons
mandate
stronger
ethical
safeguards
(Federal
Sentencing
Guidelines
for
OrganizaMons;
Sarbanes-­‐Oxley
Act
of
2002)
– AnMcorrupMon
efforts
grow.
– Stronger
emphasis
on
Corporate
Social
Responsibility
and
Integrity
Management
– OECD
ConvenMon
on
Bribery
(1997-­‐2000)
– UN
ConvenMon
Against
CorrupMon
(2003);
UN
Global
Compact
adopts
10th
principle
against
corrupMon
(2004)
– Revised
Federal
Sentencing
Guidelines
for
OrganizaMons
(2004)
– Increased
emphasis
on
evaluaMng
ethics
program
effecMveness

9. What
is
Decision-­‐making
?
• Decision
making
can
be
regarded
as
an
outcome
of
mental
processes
(cogniMve
process)
leading
to
the
selecMon
of
a
course
of
acMon
among
several
alternaMves.
Every
decision
making
process
produces
a
final
choice.[1]
The
output
can
be
an
acMon
or
an
opinion
of
choice.
• Key
influences:
– Law
of
the
Land,
Company
Policies:
SMck
to
the
rules
at
all
cost
Vs.
break
all
rules
– Environmental
Factors,
the
ground
situaMon,
criMcality,
urgency,
importance,
etc.
– Data
available:
Certain,
Complete,
Consistent,
Timely,
etc.
– Affected
by
personal
factors,
biases

10. Personal
Factors
affect
Decision
Making
• Intellectual
Ability:
The
mental
ability
of
two
individuals
will
not
be
the
same.
People
differ
in
their
capacity
to
perceive,
understand
and
analyze
any
given
problem.
Such
a
difference
is
reflected
in
their
decisions.
• Experience:
A
manager
with
considerable
experience
may
not
encounter
problems
while
evolving
decisions
even
on
crucial
maQers.
This
is
obviously
because
he
would
have
already
come
across
such
situaMons
in
his
career.
A
manager
who
lacks
experience,
on
the
other
hand,
may
fumble.
• Sen@ments
and
Values:
Every
manager
has
his
own
values,
beliefs
and
senMments.
Some
managers
may
be
pragmaMc
in
their
approach
and
may
evolve
a
pracMcal
decision
each
Mme.
On
the
other
hand,
there
are
sMll
some
others
who
may
like
to
play
safe
and
go
by
convenMon
or
custom.
• Courage:
Undoubtedly,
The
manager
needs
courage
to
evolve
and
implement
certain
decisions
on
sensiMve
issues.
• Level
of
Mo@va@on,
Self-­‐Confidence,
etc:
A
manager
with
a
high
level
of
moMvaMon
and
self-­‐confidence
may
not
be
afraid
of
the
reacMon
to
his
decisions.
He
will
not
bother
even
if
his
decision
does
not
get
the
approval
of
everyone.
He
is
sure
of
the
success
of
his
decision.

11. Values
• The
core
beliefs
we
hold
regarding
what
is
right
and
fair
in
terms
of
our
acMons
and
our
interacMons
with
others.
Another
way
to
characterize
values
is
that
they
are
what
an
individual
believes
to
be
of
worth
and
importance
to
their
life
(valuable).
(From
"What
is
the
Difference
Between
Ethics,
Morals
and
Values?",
Frank
Navran,
/
ask_e4.html)

12. Morals
• Values
that
we
aQribute
to
a
system
of
beliefs
that
help
the
individual
define
right
versus
wrong,
good
versus
bad.
These
typically
get
their
authority
from
something
outside
the
individual
-­‐-­‐
a
higher
being
or
higher
authority
(e.g.
government,
society).
Moral
concepts,
judgments
and
pracMces
may
vary
from
one
society
to
another.
(From
"What
is
the
Difference
Between
Ethics,
Morals
and
Values?",
Frank
Navran,
/ask_e4.html)

13. Ethics
• The
decisions,
choices,
and
acMons
(behaviors)
we
make
that
reflect
and
enact
our
values..
• The
study
of
what
we
understand
to
be
good
and
right
behavior
and
how
people
make
those
judgments.
(From
"What
is
the
Difference
Between
Ethics,
Morals
and
Values?",
Frank
Navran,
/ask_e4.html)
• A
set
of
standards
of
conduct
that
guide
decisions
and
acMons
based
on
duMes
derived
from
core
values.
(From
"The
Ethics
of
Non-­‐profit
Management,"
Stephen
D.
PoQs,
/resources/speech_detail.cfm?ID=821
)
• There
are
many
definiMons
as
to
what
ethics
encompasses:
– The
discipline
dealing
with
what
is
good
and
bad
and
with
moral
duty
and
obligaMon;
– Decisions,
choices,
and
acMons
we
make
that
reflect
and
enact
our
values;
– A
set
of
moral
principles
or
values;
– A
theory
or
system
of
moral
values;
and/or
– A
guiding
philosophy.
(From
"CreaMng
a
Workable
Company
Code
of
Conduct,"
2003,
Ethics
Resource
Center)

14. What
Ethics
is
NOT
• Ethics
is
not
the
same
as
feelings.
Feelings
provide
important
informaMon
for
our
ethical
choices.
Some
people
have
highly
developed
habits
that
make
them
feel
bad
when
they
do
something
wrong,
but
many
people
feel
good
even
though
they
are
doing
something
wrong.
And
o`en
our
feelings
will
tell
us
it
is
uncomfortable
to
do
the
right
thing
if
it
is
hard.
• Ethics
is
not
religion.
Many
people
are
not
religious,
but
ethics
applies
to
everyone.
Most
religions
do
advocate
high
ethical
standards
but
someMmes
do
not
address
all
the
types
of
problems
we
face.
• Ethics
is
not
following
the
law.
A
good
system
of
law
does
incorporate
many
ethical
standards,
but
law
can
deviate
from
what
is
ethical.
Law
can
become
ethically
corrupt,
as
some
totalitarian
regimes
have
made
it.
Law
can
be
a
funcMon
of
power
alone
and
designed
to
serve
the
interests
of
narrow
groups.
Law
may
have
a
difficult
Mme
designing
or
enforcing
standards
in
some
important
areas,
and
may
be
slow
to
address
new
problems.
• Ethics
is
not
following
culturally
accepted
norms.
Some
cultures
are
quite
ethical,
but
others
become
corrupt
-­‐or
blind
to
certain
ethical
concerns
(as
the
United
States
was
to
slavery
before
the
Civil
War).
"When
in
Rome,
do
as
the
Romans
do"
is
not
a
saMsfactory
ethical
standard.
• Ethics
is
not
science.
Social
and
natural
science
can
provide
important
data
to
help
us
make
beQer
ethical
choices.
But
science
alone
does
not
tell
us
what
we
ought
to
do.
Science
may
provide
an
explanaMon
for
what
humans
are
like.
But
ethics
provides
reasons
for
how
humans
ought
to
act.
And
just
because
something
is
scienMfically
or
technologically
possible,
it
may
not
be
ethical
to
do
it.

15. Why
IdenMfying
Ethical
Standards
is
Hard
?
• There
are
two
fundamental
problems
in
idenMfying
the
ethical
standards
we
are
to
follow:
– On
what
do
we
base
our
ethical
standards?
– How
do
those
standards
get
applied
to
specific
situaMons
we
face?
• If
our
ethics
are
not
based
on
feelings,
religion,
law,
accepted
social
pracMce,
or
science,
what
are
they
based
on?
Many
philosophers
and
ethicists
have
helped
us
answer
this
criMcal
quesMon.
They
have
suggested
at
least
five
different
sources
of
ethical
standards
we
should
use.

16. Five
Sources
of
Ethical
Standards
• The
UMlitarian
Approach
• The
Rights
Approach
• The
Fairness
or
JusMce
Approach
• The
Common
Good
Approach
• The
Virtue
Approach

17. The
UMlitarian
Approach
• Some
ethicists
emphasize
that
the
ethical
acMon
is
the
one
that
provides
the
most
good
or
does
the
least
harm,
or,
to
put
it
another
way,
produces
the
greatest
balance
of
good
over
harm.
The
ethical
corporate
acMon,
then,
is
the
one
that
produces
the
greatest
good
and
does
the
least
harm
for
all
who
are
affected-­‐
customers,
employees,
shareholders,
the
community,
and
the
environment.
Ethical
warfare
balances
the
good
achieved
in
ending
terrorism
with
the
harm
done
to
all
parMes
through
death,
injuries,
and
destrucMon.
The
uMlitarian
approach
deals
with
consequences;
it
tries
both
to
increase
the
good
done
and
to
reduce
the
harm
done.

18. The
Rights
Approach
• Other
philosophers
and
ethicists
suggest
that
the
ethical
acMon
is
the
one
that
best
protects
and
respects
the
moral
rights
of
those
affected.
This
approach
starts
from
the
belief
that
humans
have
a
dignity
based
on
their
human
nature
per
se
or
on
their
ability
to
choose
freely
what
they
do
with
their
lives.
On
the
basis
of
such
dignity,
they
have
a
right
to
be
treated
as
ends
and
not
merely
as
means
to
other
ends.
The
list
of
moral
rights
-­‐including
the
rights
to
make
one's
own
choices
about
what
kind
of
life
to
lead,
to
be
told
the
truth,
not
to
be
injured,
to
a
degree
of
privacy,
and
so
on-­‐is
widely
debated;
some
now
argue
that
non-­‐
humans
have
rights,
too.
Also,
it
is
o`en
said
that
rights
imply
duMes-­‐in
parMcular,
the
duty
to
respect
others'
rights.

19. The
Fairness
or
JusMce
Approach
• Aristotle
and
other
Greek
philosophers
have
contributed
the
idea
that
all
equals
should
be
treated
equally.
Today
we
use
this
idea
to
say
that
ethical
acMons
treat
all
human
beings
equally-­‐or
if
unequally,
then
fairly
based
on
some
standard
that
is
defensible.
We
pay
people
more
based
on
their
harder
work
or
the
greater
amount
that
they
contribute
to
an
organizaMon,
and
say
that
is
fair.
But
there
is
a
debate
over
CEO
salaries
that
are
hundreds
of
Mmes
larger
than
the
pay
of
others;
many
ask
whether
the
huge
disparity
is
based
on
a
defensible
standard
or
whether
it
is
the
result
of
an
imbalance
of
power
and
hence
is
unfair.

20. The
Common
Good
Approach
• The
Greek
philosophers
have
also
contributed
the
noMon
that
life
in
community
is
a
good
in
itself
and
our
acMons
should
contribute
to
that
life.
This
approach
suggests
that
the
interlocking
relaMonships
of
society
are
the
basis
of
ethical
reasoning
and
that
respect
and
compassion
for
all
others-­‐especially
the
vulnerable-­‐are
requirements
of
such
reasoning.
This
approach
also
calls
aQenMon
to
the
common
condiMons
that
are
important
to
the
welfare
of
everyone.
This
may
be
a
system
of
laws,
effecMve
police
and
fire
departments,
health
care,
a
public
educaMonal
system,
or
even
public
recreaMonal
areas.

21. The
Virtue
Approach
• A
very
ancient
approach
to
ethics
is
that
ethical
acMons
ought
to
be
consistent
with
certain
ideal
virtues
that
provide
for
the
full
development
of
our
humanity.
These
virtues
are
disposiMons
and
habits
that
enable
us
to
act
according
to
the
highest
potenMal
of
our
character
and
on
behalf
of
values
like
truth
and
beauty.
Honesty,
courage,
compassion,
generosity,
tolerance,
love,
fidelity,
integrity,
fairness,
self-­‐control,
and
prudence
are
all
examples
of
virtues.
Virtue
ethics
asks
of
any
acMon,
"What
kind
of
person
will
I
become
if
I
do
this?"
or
"Is
this
acMon
consistent
with
my
acMng
at
my
best?"

22. A
Framework
for
Ethical
Decision
Making
• Recognize
an
Ethical
Issue
• Get
the
Facts
• Evaluate
AlternaMve
AcMons
• Make
a
Decision
and
Test
it
• Act
and
Reflect
on
the
Outcome

23. Recognize
an
Ethical
Issue
• Could
this
decision
or
situaMon
be
damaging
to
someone
or
to
some
group?
Does
this
decision
involve
a
choice
between
a
good
and
bad
alternaMve,
or
perhaps
between
two
"goods"
or
between
two
"bads"?
• Is
this
issue
about
more
than
what
is
legal
or
what
is
most
efficient?
If
so,
how?

24. Get
the
Facts
• What
are
the
relevant
facts
of
the
case?
What
facts
are
not
known?
Can
I
learn
more
about
the
situaMon?
Do
I
know
enough
to
make
a
decision?
• What
individuals
and
groups
have
an
important
stake
in
the
outcome?
Are
some
concerns
more
important?
Why?
• What
are
the
opMons
for
acMng?
Have
all
the
relevant
persons
and
groups
been
consulted?
Have
I
idenMfied
creaMve
opMons?

25. Evaluate
Alternate
AcMons
• Evaluate
the
opMons
by
asking
the
following
quesMons:
– Which
opMon
will
produce
the
most
good
and
do
the
least
harm?
(The
UMlitarian
Approach)
– Which
opMon
best
respects
the
rights
of
all
who
have
a
stake?
(The
Rights
Approach)
– Which
opMon
treats
people
equally
or
proporMonately?
(The
JusMce
Approach)
– Which
opMon
best
serves
the
community
as
a
whole,
not
just
some
members?
(The
Common
Good
Approach)
– Which
opMon
leads
me
to
act
as
the
sort
of
person
I
want
to
be?
(The
Virtue
Approach)

26. Make
a
Decision
and
Test
it
• Considering
all
these
approaches,
which
opMon
best
addresses
the
situaMon?
• If
I
told
someone
I
respect-­‐or
told
a
television
audience-­‐which
opMon
I
have
chosen,
what
would
they
say?

27. Act
and
Reflect
on
the
Outcome
• How
can
my
decision
be
implemented
with
the
greatest
care
and
aQenMon
to
the
concerns
of
all
stakeholders?
• How
did
my
decision
turn
out
and
what
have
I
learned
from
this
specific
situaMon?

28. What
do
you
do
when
you
see…?
• Your
boss/colleagues/team
members
indulging
in
– ViolaMon
of
company
policies
– Illegal
behavior
– Unethical
pracMces
– Workplace
harassment
• Do
you
– Report
immediately
– Raise
hell
– Tip-­‐off
law
agencies
– Call
the
press
• You
have
to
make
some
kind
of
decision!

29. We
Don’t
Need
Another
Hero
!
• Published
in
HBR
in
Sep
2001,
this
arMcle
is
by
Joseph
L.
Badaracco,
John
Shad
Professor
of
Business
Ethics
• Key
ideas:
– The
gold
standard
of
honorable
leadership:
the
charismaMc
hero
astride
a
white
horse,
baQling
wrongdoing,
spearheading
large-­‐scale,
ethical
missions.
MarMn
Luther
King,
Jr.,
for
example.
– But
should
this
standard
apply
in
corpora&ons?
In
most
firms,
the
opposite
leadership
style
is
far
more
potent.
It’s
not
the
heroic
types
but
the
quiet
leaders
who
achieve
extraordinary
results.
They
work
inconspicuously,
deep
within
their
organizaMons—paMently
picking,
and
fighMng,
their
baQles.
– Quiet
leaders
don’t
make
headlines.
But
through
their
modest,
measured
efforts
far
from
the
limelight,
they
make
their
organizaMons
much
beQer
places.
And,
they
don’t
rack
up
casualMes.

30. Essence
of
‘Quiet
Leadership’
• …the
most
effecMve
moral
leaders
in
the
corporate
world
o`en
sever
the
connecMon
between
morality
and
public
heroism.
These
men
and
women
aren’t
high-­‐profile
champions
of
right
over
wrong
and
don’t
want
to
be.
They
don’t
spearhead
large-­‐scale
ethical
crusades.
They
move
paMently,
carefully,
and
incrementally.
They
right—or
prevent—moral
wrongs
in
the
workplace
inconspicuously
and
usually
without
casualMes.
I
have
come
to
call
these
people
quiet
leaders
because
their
modesty
and
restraint
are
in
large
measure
responsible
for
their
extraordinary
achievements.
And
since
many
big
problems
can
only
be
resolved
by
a
long
series
of
small
efforts,
quiet
leadership,
despite
its
seemingly
slow
pace,
o`en
turns
out
to
be
the
quickest
way
to
make
the
corporaMon—
and
the
world—a
beQer
place.

31. From
the
arMcle…
• In
this
arMcle,
I
explore
the
findings
of
my
four-­‐year
effort
to
understand
how
quiet
leaders
see
themselves,
think
about
ethical
problems,
and
make
effecMve
decisions.
Although
all
names
have
been
changed,
the
anecdotes
below
are
based
on
more
than
150
case
studies
that
I
gathered
from
several
sources,
including
direct
observaMon,
parMcipaMon
in
situaMons
as
an
adviser,
and
papers
and
accounts
by
many
of
my
older
MBA
students
who
came
from
corporate
posiMons
with
serious
management
responsibiliMes.
The
stories
have
convinced
me
that
while
certain
ethical
challenges
require
direct,
public
ac@on,
quiet
leadership
is
the
best
way
to
do
the
right
thing
in
many
cases.
That’s
because
quiet
leadership
is
prac@cal,
effec@ve,
and
sustainable.
Quiet
leaders
prefer
to
pick
their
baSles
and
fight
them
carefully
rather
than
go
down
in
a
blaze
of
glory
for
a
single,
drama@c
effort.

32. 4
PracMces
of
Quiet
Leadership
• My
research
suggests
that
quiet
moral
leaders
follow
four
basic
rules
in
meeMng
ethical
challenges
and
making
decisions.
Although
not
always
used
together,
the
rules
consMtute
an
indispensable
tool
kit
that
can
help
quiet
leaders
work
out
the
dilemmas
they
face.
Some
tac@cs
may
seem
a
liSle
too
clever
or
even
ethically
dubious.
Certainly,
few
people
would
want
to
work
at
jobs
where
such
moves
cons@tute
business
as
usual.
Nevertheless,
these
guidelines
oVen
prove
cri@cal
when
leaders
have
real
responsibili@es
to
meet.
– Put
things
off
un@l
tomorrow
– Pick
your
baSles
– Bend
the
rules
– Find
a
compromise

33. Put
things
off
unMl
tomorrow
• Put
things
off
un@l
tomorrow.
When
an
ethical
dilemma
escalates,
buy
Mme—it
can
spell
the
difference
between
success
and
failure.
• Example:
Under
intense
financial
pressure,
new
regional
bank
president
Kyle
Williams
inherited
four
chronic
underperformers
whom
his
superiors
wanted
to
fire
immediately.
Fearing
legal
repercussions,
he
stalled
for
Mme.
He
sought
legal
personnel
advice
and
raised
strategic
quesMons—gaining
weeks
to
resolve
all
the
issues.
The
payoff?
Three
of
the
problem
employees
le`
for
incontroverMble
reasons;
one
became
a
first-­‐rate
loan
officer.

34. Pick
your
baQles
• Pick
your
baSles.
Quiet
leaders
protect
their
poliMcal
capital—their
reputaMon
for
accomplishing
things
and
their
networks
of
people
who
appreciate
and
reward
their
efforts.
Before
taking
a
stand,
they
calculate
the
risks
and
returns
to
that
capital.
• Example:
PR
manager
Michele
Petryni
fumed
when
a
partner
in
her
law
firm
excluded
her
from
a
meeMng
because
of
her
gender.
But
rather
than
making
trouble,
she
used
pointed
humor.“I’ve
never
been
told
I
couldn’t
play
ball
because
I
didn’t
have
the
right
equipment!”
she
joked
with
a
colleague.
He
told
the
senior
partner
what
happened—generaMng
an
apology
from
the
firm.
Petryni
raised
awareness
of
the
problem—and
protected
her
poliMcal
capital.

35. Bend
the
rules
• Bend
the
rules.
Following
rules
slavishly
can
be
a
moral
cop-­‐out.
Face
it:
We’ve
all
told
a
“white
lie”
to
protect
a
friend’s
feelings.
Quiet
leaders
find
effecMve
ways
to
maneuver
within
the
rules’
boundaries.
• Example:
Consultant
Jonathan
Balint’s
brother-­‐in-­‐
law
worked
at
Jonathan’s
client
company
and
was
debaMng
whether
to
stay
there.
Jonathan
knew
the
client
was
planning
a
major
layoff.
Instead
of
betraying
the
client’s
confidenMality
by
alerMng
his
brother-­‐in-­‐law,
he
offered
hints
(“No
one
is
indispensable”).
The
brother-­‐in-­‐law
caught
on—
and
Jonathan
protected
his
own
reputaMon
and
career.

36. Find
a
compromise
• Find
a
compromise.
An
unwillingness
to
compromise
may
be
morally
principled—but
it’s
unrealisMc
in
most
situaMons.
Quiet
leaders
cra`
responsible,
workable
compromises.
• Example:
Sales
rep
Roger
Darco
couldn’t
sell
a
longMme
customer
a
server
it
needed;
his
company
reserved
them
for
“premier”
clients.
Rather
than
disappoint
his
customer
or
fake
documents
to
sell
the
server,
Roger
arranged
for
his
customer
to
serve
as
a
test
site—and
get
the
computer
earlier.
He
pleased
his
customer
and
his
company.

37. Reading
List
• The
Ethical
Mind
–
conversaMon
with
Howard
Gardner
• The
Ethical
ResponsibiliMes
of
Professionals
–
Howard
Gardner
• Business
Excellence
through
Value
Systems
–
Sharu
Rangnekar