Don’t hide the morality of business decisions by Chris Paterson

Don’t hide the morality of business decisions

Companies should be more open about the moral rationale behind business decisions. Showing they are doing the right thing by their people can help engage staff and build a more sustainable workforce. Actively reporting management’s moral motivations can also help rebuild people’s fragile confidence in business.

Senior Manager - People Powered Performance

KPMG LLP (UK)

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Companies should be more open about the moral rationale behind business decisions. Showing they are doing the right thing by their people can help engage staff and build a more sustainable workforce. Actively reporting management’s moral motivations can also help rebuild people’s fragile confidence in business. 

There is tremendous value in convincing employees you have their best interests at heart. That is a really effective driver of engagement. It is also what people expect. This is demonstrated by adverse public reaction when this perceived code is broken, for example when asset strippers are seen walking away with assets while staff are left jobless. 

Admittedly, shareholders and other business owners may be less interested in a board’s dedication to their employees. However, it should also be in their interest if it helps retain and engage high value employees and enhances a company’s brand. 

There are companies leading the way on this but why are they are in the minority? The problem lies less in the decision-making and more in the communication of how those decisions were made.

Contrary to popular belief, I suspect most businesses have a moral core, influencing every decision. I have seen board members agonise long and hard over whether they have been fair and managed to get the best deal for their people, but I know this was not seen by the outside world. Obviously there are always going to be some individuals and companies who don’t take this level of care, but I believe they are in the minority.

I am not saying companies should not take decisions that have adverse consequences for their people, including redundancy in the worst-case scenario. If there is a strategic decision that requires downsizing or moving resources, then yes, the first thought should be about the options for the business. But the second should be around the impact on the people affected. 

Some may argue that staff should be a company’s first consideration, but business is not that simple. Without a sustainable business, there is no workforce. The important thing is that the business wants, and strives hard, to do the right thing.

Why then don’t more companies, which do take this approach, make this more-caring attitude clear to staff? It would appear to be a missed opportunity. However I believe they disguise their good intentions because they feel it conflicts with their public obligation to maximise shareholder value. The result is that workforce may assume, mistakenly, that the company’s leadership does not have their best interests at heart.

Having that moral imperative on the table means it is openly present in decision making that can lead to more sustainable outcomes. There should be no embarrassment about what is best for the staff and the business as a whole.

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