Metrics Vs. The Intangible Benefits of Ethics Training

Interesting artcle in CFO.com this month on the use of metrics to more objectively assess organizational change. No argument that objective measures are always of great value.

It has long been tough, however, to guage the benefits of ethics and values training. A truly empirical approach would be rough as how many companies would wish to volunteer to be the unethical organization against which to study the businesses invested in ethics??? However, thankfully there are many other available measures including reductions in observed ethics problems, reduced fraud loss, etc. In fact, in the latest two year study of major companies by the Association of Certified Fraud Examiners, those companies with ethics training programs suffered, on average, approximately half the fraud losses of those companies without such training. Might there have also been other factors at play in those companies that affected the outcomes? Sure, but the most parsimonious explanation points to the investment in ethics training as a primary differentiating factor.

The CFO.com article also points to the need to look at indirectly correlated data to determine the impact of training. This is also true of ethics and values programs. For example, a well done ethics and values program ought to result in the building of a stronger team. Though that isn’t about ethics per se, it logically streams from ‘being on the same page’ regarding ethics and values. Are there significant benefits to having stronger teams? I suspect that few people would argue with that!

In addition, it is important to look at a variety of potentially significant intangibles that derive from well-conceived ethics and values programs. As just one example, wouldn’t it be nice to sleep better at night knowing that ethically-attuned decisions are being made in your company all day, every day? After all, working ethicallly is simply the right thing to do.

However, creating great ethics and values training programs certainly needs to be about much more than just ‘feel-good’ outcomes. Given the significant, measurable direct and indirect benefits of such programs, though, I’d say those feel-good outcomes are an awfully nice additional benefit to an initiative (effective ethics and values training) that will also help to greatly build a company’s bottom line.

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