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True North

Posted By David T. Norman FIMC CMC-AF, Sunday, August 7, 2011
My wife, Louise, and I were sitting in the Frankfurt airport heading towards Greece and Turkey for a much-needed vacation. Thomas Freidman's July 21st commentary, A Cultural Revolution, in the Global Edition of The New York Times about Greece's problems caught my interest since we were headed that way.

While the commentary was about Greece's current situation, what captured me was Freidman's opening stance. Quoting, "The globalization of markets and people has intensified in the past five years, with the emergence of social networking, Skype, derivatives, fast wireless connectivity, cheap smart phones and cloud computing.

"When the world is bound together this tightly ... everyone's values and behavior matter more than ever, because they impact so many more people than ever ... We've gone from connected to interconnected to ethically interconnected.

"And it is harder to shield yourself from the other guy's irresponsible behavior ... both he and you had better behave more responsibly -- or both of you will suffer the consequences, whether you did anything wrong or not."

In an earlier post I commented on McKinsey's Managing Director Gupta's situation with accusations of assisting with insider trading for a hedge fund manager. After coming back from vacation, I find this -- on August 5, the SEC dropped its civil administrative proceeding against Gupta, because the commission determined that "it is in the public interest to dismiss these proceeding.”  However, the commission may still pursue insider-trading charges against him in a civil lawsuit.

Yikes! Once again, I reflected on the quandary I'm in as relates to today's societal expectations regarding ethical behavior. It seems to me that ethical behavior is not only is the right thing to do, it is also very easy. IMC USA has a Code of Ethics that guides your behavior as a management consultant and, as a member, you subscribe to it. Align your moral compass with true North; it's easy and it is a differentiator.

So, two questions:

(1) Is Friedman right? Are we all bound tightly, ethically interconnected?

(2) And, if so, why is it, to some, so hard to behave in a manner that you are 'doing the right thing?'

Help me out here. Add your comments to these questions and tell me about YOUR moral, ethical compass? Or, tell me about how your clients appreciate your adherence to a Code of Ethics. Share.

Stay tuned,
My best,

Tags:  Code of Ethics  Ethics  Gupta  IMC  McKinsey 

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Comments on this post...

Richard D. Maher says...
Posted Sunday, August 7, 2011
David - Friedman is (of course) right. I remember a master's course i took in the 70s on international economics predicting international economic inter-dependance. Well, it's finally arrived! Politicians are getting many 'hints' that conflicted policy directions have impacts -- across the globe. Ethics play a part in business and in government. We're going to have to get to a place where we focus on a common future vision - one where we find areas to agree and collaborate - order to find stability and productive policy directions. All of us need to find a new "truth north" in that common vision and rely on each other to work ethically in that common cause. When that confidence is breached, we all lose. Our profession can lead through our example. Someone sure needs to, and fast.
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Chris N. Lambrecht CMC says...
Posted Monday, August 8, 2011
No doubt, awareness of what is happening globally has increased with technology. But does that matter? Certain countries have adopted a culture of entitlement, and though many of us in the U.S. have been critical of these cultures, we've pretty much decided to go down the same path. I believe the same can be said of business ethics in the U.S. We've openly criticized the immoral business cultures of other nations, but have slowly adopted them in practice. As our economy unwinds, more people will become desperate, and desperate people have been known to take desperate measures. Hopefully there will continue to be a handful of us that take ethics seriously and lead by example. Will anyone notice?
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Manola C. Robison CMC FIMC says...
Posted Monday, August 8, 2011
I concur with Friedman. However, the decline of ethics is not limited to the business world; it is pervasive and expanding in the entire society.
I think a key warning was well expressed by the preamble to Thomas Payne’s Common Sense “A long habit of not thinking a thing wrong gives it a superficial appearance of being right, and raises at first a formidable outcry in defense of custom.”
We each have to start restoring our societal moral compass if we want to leave a decent, peaceful, and livable world for the generations to come, one capable of making tough ethical choices.
Let’s invite each other to go to our homes, to work, to parties and examine those long habits that have acquired the superficial appearance of being right, but may be neither right nor customary.
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James R. Surman Sr CMC says...
Posted Sunday, August 21, 2011
We always hear of the lack of ethics from this corporation or that borker, however we seldom hear of the CEO that adhears to strict ethical behavior.
One of my client CEOs signed a $750,000 contract with one stipulation "No Free Lunches." He said, "you can take my V.P.s or Managers to lunch, but if it's over $25 they must report it to the Senior Management Committee. I know that when your working together on an engagement, you may sometimes share a Coke or hamburger." He went on to say that he requires the same conduct for himself as he does for his employees. "I want complete and open objectivity in this engagement,"he said.
" My friends, that is ethics.
While working at a major consulting firm, when I first started in consulting, I witnessed CEOs requiring season tickets to local sports teams or a trip each Christmas to New York City for the client CEO to take his wife shopping, when they signed the engagement letter.
Ethics must be defined and openly professed. Being unethical is not a cost of doing business.
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