“Despite new regulation and significant efforts to reduce misconduct and increase reporting when it does occur, the ethics risk landscape in American business is as treacherous as it was before implementation of the Sarbanes-Oxley Act of 2002,” said President Patricia Harned, President of the Ethics Resource Center (ERC).
Here are some highlights from ERC’s 2007 National Business Ethics Survey of almost 2,000 employees at U.S. public and private companies of all sizes:
More than two of five employees (42 percent) who witnessed misconduct did not report it through any company channels.
Over the past year, more than half (56 percent) of employees surveyed had personally observed violations of company ethics standards, policy or the law. Many saw multiple violations.
More than half (54 percent) of employees who witnessed but did not report misconduct believed that reporting would not lead to corrective action.
More than a third (36 percent) of non-reporters feared retaliation from at least one source; but our research shows that having a strong ethical culture virtually eliminates retaliation
Less than 40 percent of employees are aware of comprehensive ethics and compliance programs at their companies.
Despite the bleak results, according to Harned, “the good news is that the rate of misconduct is cut by three-fourths at companies with strong ethical cultures, and reporting is doubled at companies with comprehensive ethics programs.