In a recent interview with Reputation.com, I talked about the effect the Internet has had on reputation management, and the connection between that and ethics.
The risk, of course, in having an ethics professor like me talk about reputation management is that it’s all too easy to give the impression that the two topics are the same. In fact, I’m pretty sure there are people out there who assume they are the same thing.
And certainly there are those in the field of ethics who contribute to that way of thinking. Sometimes that takes the form of what is often referred to as “the business case” for ethics (or for CSR, or for sustainability). The business case takes many forms, but all of them boil down to an assertion that acting ethically (or being socially responsible or being sustainable, whatever) is good for your business. The specific mechanisms mentioned are varied. Treating your workers well improves retention. Going green reduces energy costs. And, yes, that being ethical is good for that all-important corporate reputation.
The worry is that businesses exposed to such arguments will come to think of ethics from a purely instrumental point of view: we’ll act ethically only because, and only to the extent, that it’s good for profits. Thinking of ethics that way implies an incredibly low level of commitment. You won’t always in every situation be able to draw a straight line between this bit of ethical behaviour and that bit of profitability. And so the ethical behaviour of a company under the sway of “the business case,” it seems, would be liable to an ebb and flow on a pretty regular basis.
But the key isn’t to avoid talking about the business case for ethics. Because it is simply true that, on the whole, acting ethically is good for business. Sure, you can make a quick buck by being a cheat. But smart managers have known forever that the route to sustainable profits lies in paying your bills on time, treating your employees well, cleaning up your own messes, and dealing honestly with your customers. Having a reputation for doing those things is truly good for business.
Clearly, having a reputation for doing those things isn’t precisely the same thing as actually doing them. In theory, it’s possible to act badly but to keep the facts quiet. Or at least, that was the case once upon a time. Then along came consumer blogs and Twitter and Facebook and Tumblr and so on; now, accusations of bad corporate behaviour has a way of getting out and spreading like wildfire. Today, certainly, it seems like the easiest way to get and keep a reputation for honesty and integrity is actually to behave with honesty and integrity. It’s always better to avoid fires than to have to put them out. That’s why the best reputation management method is to build a good reputation in the first place.
But of course, sometimes even an honest company, trying its best to treat people right, can hit a rough patch. Sometimes something goes wrong, and sometimes—in an era in which all of your customers have access to a 7 billion-person conversation called the Internet—that fact gets aired in a very public way. Hence the need for online reputation management, to control the damage. But even here, the key is to make your participation in those online conversations genuine, or if you prefer “authentic.” You need to be sincere about your commitment to doing the right thing, and to making things right when mistakes are made. This is the irony of the business case for ethics. The best way to reap the benefits of a reputation for being ethical is not to pay much attention to those benefits, but to focus on the importance of doing the right thing—for its own sake.
Chris MacDonald is Director of the Jim Pattison Ethical Leadership Education & Research Program at the Ted Rogers School of Management.