Common sense says that ethical and legal problems will skyrocket as companies make compromises to deal with the current business and financial crises around the world. Sadly, tough times are periods when folks are increasingly likely to allow or require shortcuts on the following of policies, procedures, and legal mandates if they believe that money can be saved that way. This is a growing risk among managers as much as for business owners and the current business and financial crises make this a time when there needs to be a particular vigilance when it comes to monitoring for 'red flags' for both ethical and legal problems.
Here's a somewhat jarring counterpoint to the above, however…
Data from the Ethics Resource Center's
2007 National Workplace Ethics Survey shows a whopping 11% increase in the observation of misconduct in companies experiencing mergers, acquisitions, transitions, or restructuring. Interesting data in and of itself. However, my point here is that those activities (mergers, acquisitions, etc.) are just as likely to occur on companies doing incredibly well as in those on tough times. In some circumstances, of course, they are actually more
likely to occur in companies doing well.
It would be foolish to turn a blind eye to the growing risks for ethical and legal lapses related to the current financial crisis. However, it would be equally foolish to forget that any times of major change – in both good times and bad – are highly related to a wide variety of ethical and legal misconduct.