Interview with George G Brenkert on Building Ethical Organizations
August 2009 - By Dr. Nagendra V Chowdary

DR. George G Brenkert
Professor of Business Ethics at the McDonough School of Business, George town University.

• With millions of jobs being cut, the global financial system under serious stress, and many companies across the globe going bankrupt, many have likened this crisis to Great Depression II?What’s your reading of the current financial crisis?
  The current crisis is far more serious than previous ones, excluding the Great Depression. It was caused by multiple failures, including (importantly) ethical failures by those in business and those in government (not to mention customers themselves). Those in the real estate and financial services industries failed, too often, to perform due diligence with regard to those they did business with. Worse, they engaged in forms of deception and dishonesty when it came to acquiring customers and creating financial products. Monitoring and evaluation services also failed, due to conflicts of interest, not to mention simple greed. Customers hid the truth and lied regarding their financial and personal circumstances. In short, there were many ethical failures that contributed to this crisis beyond the failures to properly judge financial risks that were being undertaken or imposed on others.

• You have been in the forefront making a strong case for honesty and fairness in organizations. What according to you are the critical elements of honesty and fairness in organizations? What are the yardsticks to measure the same?
  This question might be considered both from within an organization and from outside the organization. From the inside, the critical elements have to do with the ability and willingness of executives, managers, and employees to admit to themselves, to those they supervise, and those to whom they are accountable what the truth is they and their company faces. This involves not only what they say, but how they organize ordinary work procedures, how they compensate individuals, and how they evaluate them. If theway in which they engage in these activities promotes dishonesty and unfairness there is not much hope for the organization. Outside the organization, we must ask how it interacts with customers, other businesses, the government, and the environment. Again, if the procedures and structures in place encourage dishonesty and unfairness, then we cannot expect that we will receive much honesty or fair treatment from the individuals involved.

• Many question the relevance of business ethics as a course in MBA programs arguing vehemently that, you cannot teach some one to be ethical, after all’. What has been your experience in delivering this course?
  If by “teaching someone to be ethical” is meant that you make them act ethically, then I reject the suggestion. You cannot make someone be ethical, as you might make someone do a calculation or sell a product. However, you can (in part through teaching) help lead and guide people to ways of thinking and responding to situations that will foster their ethical behavior. In some cases, one might even inspire others to be ethical, either through their own actions or the stories and experiences they relate to them.

  In fact, I begin by assuming that most people are ethical, but because of the difficult situations they face, because they encounter problems they have not previously encountered, or because the dilemmas they face are terribly complex with significant consequences (both seen and unseen), they can use some help in thinking through what would be an ethical answer. This is where case studies and additional relevant readings, videos, and guest speakers can be valuable. Of course, not all business students are open to this.

  They may come with assumptions about how people behave in business which tend to undercut such efforts. Some responsibility, I believe, for this attitude may rest with other more general attitudes not only in businesses but in business schools themselves.