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Transcript: Don’t tempt your employees to do the wrong thing

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KARL MOORE – This Is Karl Moore of the Desautels Faculty of Management at McGill University, Talking Management for The Globe and Mail. Today I am delighted to speak to Northwestern's Keith Murnighan.

So Keith, ethical dilemmas - we see more of them arising in society. What is your thinking about how we should approach ethical dilemmas?

KEITH MURNIGHAN – People face ethical dilemmas all the time, as you mentioned. We are tempted by greed, we are tempted to do the wrong thing even when we know that we should do the right thing. Sometimes we have tough choices between things like being just or being merciful and those make for tough ethical dilemmas. Some of the things that we have looked into are that people are really kind of on the fence in a lot of these situations and it does not take much to move them one direction or another. In particular, one of the research programs we have done recently has given people an ethical dilemma - should I lie and get more money or tell the truth and get less? Pretty darn basic! It turns out that if we ask them to make that decision right away, about half of them lie. If we tell them to think about it for 3 minutes before you choose, only 10% lie. So contemplation is one way that people can move toward ethical choices because it gives them time to get away from their immediate instinctive self-interest to realize maybe self-interest is not such a good thing here.

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KARL MOORE – So how does a leader, or a manager, help their people be more ethical in that case?

KEITH MURNIGHAN – So leaders can be more helpful in a variety or ways. One is to take temptation away. One of the silly things I will say to people is, "Don't leave piles of money sitting around your office uncounted. I mean, it just doesn't make any sense so take temptation away and there are a variety of ways we can do that. Second thing is, actually have reminders about good moral choices around. A third thing is actually pictures of people. So what we have done, in another study, is we have given people temptation to lie for money, and many of them do, but in fact we have also given them where they do calculate net present value and then we give them an opportunity in lieu for money. If, before having them make those lie for money choices, they do some net present value calculations and then we tell them, "This was about a family business, pick one of these pictures," and we show them pictures of four families, then we have them make the lie decision, they are much less likely to make it when they are socially aware. So you can get into a mindset of money, of calculation, of finance, of accounting, and if it's divorced from social life it is hard to see the consequences of your choices on others. But if we can incorporate that a bit, reward people for citizenship, for other behaviours and kind of trump that throughout an organization, then it is much easier for people to make the right choices.

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