Leaders are becoming increasingly conscious of the strong link between the perceived ethical “health” of their organization and the engagement of employees. Trust and respect for leaders, confidence to speak up without fearing the consequences, pride in working for the company, and a vested interest in the job are all drivers of engagement.
But what is an ethical culture and how does it affect engagement? An organization’s ethical culture can be assessed through many interconnected activities, but key to defining whether it is on the right track are:
- Ethical leadership (the tone at the top) the consistent reinforcement of an organization’s ethical standards by supervisors and managers.
- Consistent and clear messaging about values.
- Employees openly supporting each other to do the right thing.
- A culture of openness and speaking up.
- Consistent and transparent decision-making.
Unsurprisingly, these factors can also demonstrate whether an organization is acting to embed an ethical culture or simply talking a good game. Most employees arrive at work wanting to do the right thing and a good job, but the behaviors and perceived ethical actions of their leaders have a direct impact on how engaged they remain and whether they believe that their leaders take espoused company values and behaviors seriously.
The Wells Fargo example
In early 2015, Lucy Kellaway, journalist and observer of corporate communications for the Financial Times, picked up the fact that U.S.-based Wells Fargo bank had launched a new internal initiative: the happy/grumpy ratio. The idea behind the ratio was that happier employees were more likely to do the right thing than grumpy ones, and by the bank’s measure, the happy outnumbered the grumpy by 8:1.
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