Six Principles for Business Ethics

By reevaluating our principles, we make them more relevant to the challenges we face. Our principles must live through us if business ethics is to be a way of life.
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The pleasure of teaching is being taught -- a lesson I learn every time I teach business ethics.

It's a good thing, too, for unlike my peers at law and medical school, I have no established canon of ethics to teach my MBAs. Instead, I ask them to make a virtue of necessity and define their own canons, drawing on their experience as young professionals.

In the spring, I put this challenge to my students at the University of Chicago Booth School of Business. As part of their final exam, they wrote one-page statements defining their professional principles. With their permission, I'd like to share a few of my favorites.

Pass "The New York Times Test"

For those times when you find yourself in a compromising position at work, Cyrus, a lawyer and second-year MBA, proposes "The New York Times Test." The test is simple. "If you would not feel comfortable with everyone you know reading about what you are currently doing," says Cyrus, "don't do it." The contrary is also true: If you would be proud to make headlines, redouble your efforts.

"Be accurate: When I say something as if it is a fact, be sure that it is a fact."

How often do you hear people at work say I don't know? Not enough according to Michael, a first-year MBA. Instead, people pass off their best guess as authoritative fact. "I don't have a problem with someone saying, "I'm not sure but my best guess is... " he says. "But I do have a problem with someone stating something as a fact when it is not a fact." The temptation to bluster is powerful -- everybody wants to be a go-to person -- but decisions are only as strong as the facts that inform them. Better to be uncertain than unreliable.

"Listen to the buzzing: It's there for a reason."

Michael also describes the buzzing we hear when we know that something is wrong but we can't quite put our fingers on it. At work, this often happens when we get requests from superiors that aren't illegal or even obviously immoral but that strike us as peculiar and ill-advised. Yet, instead of acting on that buzzing, many people learn to ignore it -- so much so, Michael says, "they don't even hear it anymore." Here's a better habit: Listen to the buzzing and be forthright when something is wrong.

"Maximize happiness, not wealth"

The old saying goes that money can't buy happiness, but this lesson seemed lost on many of Maria-Pia's co-workers. A first-year student from Peru, she says they "measured themselves and others in terms of the amount of money they made and the positions they had reached." For her, this way of looking at the world is hazardous and dreary. [Y]our goal in life is happiness, not richness," she says, a goal that is mindful of a wider variety of concerns -- family, friends, health, peace of mind -- than simply the size of one's bank account.

"Be as disciplined morally as I am financially"

Everyone in business agrees that financial analysis should be conducted with the highest degree of rigor. Aleca, a second-year student who has worked in the insurance industry, asks Why should ethics be any different? "[I]n order to act in a moral manner," she says, "I need to consciously analyze my actions from a moral perspective the same way I analyze my actions from a financial perspective." The focus on procedural care is instructive. Moral decision-making will always be open to dispute, but we should aim to ensure that whatever decisions we reach are the consequence of careful thinking.

"Continuously reevaluate my principles."

Business ethics begins as a commitment, but strengthens by habit. Ray, a second-year student, captures this in his final principle. Articulating one's beliefs is a valuable exercise, but they are reaffirmed by practice and reflection. At the same time, our experience at work can complicate and even change our moral convictions. By reevaluating our principles, we make them more relevant to the challenges we face. Our principles must live through us if business ethics is to be a way of life.

John Paul Rollert is an Assistant Adjunct Professor at the University of Chicago Booth School of Business and the author of Does the Top Really Support the Bottom? -- Adam Smith and the Problem of the Commercial Pyramid

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