[MUSIC] Sometimes despite our best efforts to create an ethical work culture, by implementing an integrity strategy and carefully considering our decisions through the frameworks. We might still be creating conditions that lead our direct reports to engage in wrongdoing. This fraud triangle was created by Steve Albrecht through work done by Edward, Sutherland and Donald Cressy. Check that you have not put any of these in place in your workroom, opportunity, rationalization and pressure. How is the organization structured? I advised earlier to ensure your employees have autonomy as Daniel Pink demonstrated, this is a key motivator that autonomy has to be balanced with some oversight. The monitoring and control systems to ensure that company policies and rules are followed. Do you allow your employees to hire friends and family members? What about for contract work, it could be a good idea. I'm not saying you shouldn't do it, but it does require oversight. It could lead to false billing, it could lead to a lack of equity in hiring or pay. What about government regulations? You don't have any control over these, but if they're not well designed or enforced or become more about filling out paperwork, employees could be using the loopholes to engage in wrongful actions. If that's the case, your organization or your work group might need to implement some policies or procedures to ensure ethical actions. Regardless of how poorly implemented the government regulations are regarding rationalizations. There's a great book by Albert Bandura called Moral Disengagement. How people do harm and live with themselves, strongly recommend this book. Bandura says we are not bad people, but we do sometimes behave badly when we act in ways or treat people in ways that are counter to our moral compass. We use a variety of rationalizations to disengage from that morality and thereby reduce our inner conflict. Bandura says we're all good people in the abstract, it's when we're faced with a situation that we sometimes let our values go and we let ourselves engage in bad behavior. Rationalizations or moral disengagement mechanisms, as he calls them, include euphemistic labeling. Did we downsize or lay people off? Did we over bill or steal advantageous comparison? Well at least we're not as bad as that group is distortion of consequences. No one really got hurt, displacement of responsibility. It wasn't my decision or diffusion of responsibility. Well, everybody does this, if you ever hear people say or hear yourself say any of those quotes, you're engaging in a moral disengagement mechanism. We as managers might drive our employees to rationalize unethical actions by setting up impossible targets with punishments for failure to meet them. Remember the Wells Fargo case, employees may feel they have no choice. Yes, we should set stretch goals, we should ask our employees and ourselves to work toward far reaching goals. But while reaching near them should be rewarded, failing to reach impossible targets should not result in punishments. Do we make it difficult for our employees to speak up or maybe even correct us if we do something unethical accidentally? I was in a meeting where our division president suggested doing something that we might euphemistically call fudge the numbers or cooking the books. And I as the controller knew that what he was asking for was not legal, when I said very carefully, so as not to accuse him of anything. We should check with the accountant's first, I'm not sure that's legal, he replied, well, Alyssa obviously failed finance. That shut me up in the meeting, but it didn't stop me from checking with the accounting department, discovering the action was indeed illegal and making sure it did not happen. But that kind of comment in a room full of one's peers and superiors could have shut someone up going forward and the company could end up engaging in wrongful actions. Because no one dared double check master manipulators often know the inner minds of those they intend to manipulate. Don't give people ammunition by demonstrating a lack of confidence, particularly in an area where you have competency. The point here is your behavior can drive your employee's behavior, create an environment of curiosity and candor to ensure there are checks and balances. Rather than a culture of fear that shuts down all learning and creates legal liabilities. Pressure can be internal or external, your employees might have personal pressures of which you are unaware and really you cannot ask. They could have a mortgage or feel pressure to send kids to a private school that they can't afford. They might have health care needs or elderly parents needing expensive care. If your company has an EAP, an employee assistance program, make sure your employees know about it, and make sure they understand that using the EAP is private or confidential. Talk it up when you can, there are many benefits from mental health to debt counseling to child and elder care programs. If you work for a company that does not have an EAP, suggest one to your company if it's big enough to support it. Otherwise you might need to be aware of how your employees are doing and be supportive when you can. But again you cannot ask about these kinds of detailed things going on with your with your employees? External pressure is one where you have more control. External pressure might be coming from you, your organization or culture or the industry. And as I mentioned in rationalizations, job output requirements might be too high. They might be vague and that makes them unrealistic. Have you been completely clear in delegating tasks or did you demand something, quote as soon as possible? Remember soon as not a deadline, some is not a number. Also, sometimes we expect people to be something they are not. Have you demanded someone hide who they are by creating a culture where everyone is expected to fit in? Do your employees need to wear a figurative mask to work not a real mask, but figuratively in order to fit in. Do they have to pretend something about themselves it isn't true because this is a huge drain on mental energy. I once had a boss say he was very disappointed in me because he expected that I would be quote consistently brilliant and I was only working hard and really smart. People cannot live up to images and icons. If you are in a highly competitive industry, you and your employees are going to be feeling the pressure. You're going to have to consistently constantly innovate to ensure you are meeting customers needs in a way your competitors cannot. Don't create additional and ultimately counterproductive pressure by being impossible to question and requiring people to be perfect. Pandura posits that our unethical actions are not a result of moral defect. We're not bad people, but of moral slumber. If we want to behave better, we need to wake ourselves up. One way to stay awake is to keep your values front and center, find a place to put the ideal values you listed in the earlier exercise so that you can see it. And if that feels like too much, write down what it means to you to be a good person or write down why you care about other people. Put it in a card that you carry in your wallet or on a post it note on your computer monitor. Put it in your phone set an alarm to read it regularly, wake yourself up again and again to who you are and who you want to be. I have a sign on my wall that quotes a volunteer firefighter. He says every day does not offer an opportunity to save someone's life, but every day offers opportunities to affect one. So as a professor, I might not change someone's life, but I can listen to each student completely and hope that when they leave my classroom or office, they listen to the next person completely and so on. Such as on that day, numerous people experience themselves as respected individuals with something of value to say. So write down what it means to you to be a good person and why you care about other people and keep this wherever it will best serve you. And if you are in any business related to technology and really who isn't I strongly recommend you review this toolkit with your colleagues ethical OS.ORG. The link is in your workbook, it will help you and your team by considering if the technology you're building right now will be someday used in unexpected ways. How might you prepare yourself? What new categories of risk should you pay special attention to and which design team or business model choices can actively safeguard users, communities, societies, and your company from future risk. In summary, while ethical reasoning and decision making are challenging. You can use a variety of ethical views formed over centuries and the frameworks provided in your workbook to support you in being rigorous and rational, rather than reactionary.