CULTURE, LEADERSHIP AND COMMUNICATION / ALBERTO ANDREU

Dean of the School of Economics and Professor of Ethics... The question is: how does Economics in general get along with ethics? I ask this question because some (many) think that you cannot make money by being ethical... as if talking about ethical Economics were an oxymoron.

I understand that when you ask me about Economics you are referring to the economic activity or rather to the business activity. Well, they must necessarily go well together, that is to say, they are inseparable. Every activity, every free decision of the human being is ethical, there is a moral dimension in which one can evaluate the responsibility of staff in the decision and in the subsequent consequences. The core topic is that from an ethical perspective these decisions are well taken. In principle, there is no incompatibility between making money and being ethical. The problem is to know how to make money doing things right, using reasonable means, that is why I like to qualify the principle of profit maximization (which according to economic models guarantees the efficient allocation of resources and that is very good) by adding either an adjective reasonable profit, or an adverb reasonably maximize profit. The word reasonable has many implications, because it means many things: respecting human rights and laws, treating employees and all stakeholders with dignity, fair wages, decent work conditions, facilitating the reconciliation and the integral development all, providing good, safe, useful goods or services that contribute to the common good and respect the environment, that are sustainable, in fair skill , reasonable prices, and a long etcetera.

Since concepts are important, and since we are in college, I have always wondered what is the difference between ethics and integrity. Or are they equivalent concepts?

Ethics is a science that studies human behavior in order to know how to make good decisions that make the world a better place, starting with the person who makes the decision. Integrity is a quality of the person who manifests that his decisions are consistent with his values, that he acts in conscience and is consistent, that he does not get carried away by short-term interests.

or selfish, but keeps me consistent to their values, in all possible areas of their decisions. Ethics is related to integrity, because this intellectual reflection of humanity on good and evil and how they apply to our actions, facilitate us because they give us arguments, to be upright.

As you know, throughout my professional degree program I have had to implement ethical management systems in corporations, creating mechanisms and counterweights so that decisions would respond to a certain corporate ethics. In your opinion, what is more important for us to be able to say that a company is ethical? corporate ethics or staff ethics?

I find the question very interesting. If I had to choose between the two, as if they were mutually exclusive, I would opt for staff ethics because it is the only one that exists in reality. The decisions that people make are deeds and not words. But undoubtedly, in order to create an ethical culture in business , words are also necessary, i.e. they are not mutually exclusive, but complementary. They even reinforce each other. It is desirable, if not necessary, to have a certain statement of values, which will inspire subsequent decisions, a mission statement and a vision, a known and shared purpose , channels for employees to raise their doubts, training programs that provide employees and managers with guidelines for action. All these policies, together with the coherence and example of managers, create a sensitivity and an ethical awareness that permeates the organizations and helps staff ethics to take root.

If we were to carry out a kind of ethical audit in a business... What are the first practices or behaviors you would look for to be able to say that you are dealing with an ethical business ?

In the previous answer I have made a brief list of some ethical practices. Not all of them have the same importance, and they respond to a certain chronological order. I would say that the first thing to do is to define the purpose of business, which is the raison d'être of business, and that it is not only to make money. That is an instrumental, necessary goal , but it is not what gives meaning to human activity. If this were so, it would be an absolutely impoverishing mentality of work, losing the meaning of work as a source of meaning, satisfaction and happiness for staff life. The purpose must define what is the service to be rendered to society and how it will be rendered. This purpose, whether in the form of a mission statement or vision, or simply as a purpose, must be coherent with the values that the organization establishes as referents. And from there, which is the most general, to the most particular: codes of conduct and governance, guidelines for employee training , how conflicts are resolved, what support and financial aid is given to employees to help them with their professional and personal problems, how employees are helped to find meaning in their work (closely related to the purpose of the business).

Shortly after the reform of the Criminal Code was approved with the introduction of the figure of compliance, the Attorney General's Office issued a circular in which it said that what was really important was not for companies to establish a complete compliance procedure , but to ensure a culture of compliance and ethics in the corporate culture and throughout the chain of command when making decisions. So the question is this... what needs to be done to embed ethics in the corporate culture and decision-making process?

Months ago I had a meeting with the Compliance and Ethics Institute to discuss possible joint collaborations, and the first thing I said to them was that I like the word ethics to come along with compliance. Clearly, compliance procedures are very important, establishing rules and guidelines, channels and practices that ensure in some way that employees are going to do the right things, that they are going to make the right decisions. But it is even more necessary to train people in the virtue of prudence, whereby we learn to apply general principles and rules to particular situations. Because the circumstances involved in each decision must be considered, and sometimes these particularities cause the rule to be applied in a different way. Employees must have the theoretical and actual ability, i.e. train and enable them, to apply the rule to the particular case. This sometimes implies a freedom, which may seem arbitrary, but it is not, because it is the human being's ability to think and decide. Otherwise, the problem of a world that is too normativized, trying to cover all possible particular situations, makes us lose humanity, and we become more and more like robots, who move according to protocols marked by algorithms. And a world run by robots, no matter how much artificial intelligence is developed, is inhuman. We have a lot at stake in the training of people in the exercise of prudence.

In your experience, and if we pull from periodicals collection what are the most revealing cases or examples you have come across where ethical criteria have prevailed over economic criteria? And vice versa?

There is a paradigmatic case which is the decision made by Aaron Feuerstein, president of the textile business Malden Mills, located in a small urban center in Massachusetts (Lawrence) when one of its factories caught fire and instead of collecting the 300 million dollars of insurance and close the business and retire, reasonable with 76 years old, he decided to fight, go ahead and rebuild the business, keeping the full salary of its 3000, although some had nowhere to work. His workers tripled the productivity of the plant that did not burn down, working overtime, giving their all for the business. This is creating a community of people, which is what a business should be, where everyone feels part of it, is involved and important.

Turning to more recent cases, there are companies with an impressive ethical culture, such as Danone, Michelin, Patagonia, John Deere, Kellogs, Mondelez... but even very reputable companies can make big mistakes at other times. Take the case of Johnson and Johnson, which gained a very good reputation 40 years ago with the famous case of Tylenol, an effective, safe and widely consumed painkiller, but which apparently began to cause some deaths, seven, in the United States in the early 1980s. The business, although the connection was not confirmed, withdrew 30 million tablets, causing losses of 100 million. It was later proven that a madman had contaminated some pills with cyanide, but in very few units. Their credo on that occasion was above profits. This same business, through a subsidiary De Puy, launched on the European market, about 15 years ago, hip prostheses that had not obtained the authorization of the American FDA (Food and Drugs Administration) for the marketing of these prostheses, but sold them in the rest of the world because the requirements are less demanding, also taking advantage of a legal loophole, knowing that they could endanger the health of many people. Ten years ago, it had to recall these prostheses and compensate many patients to the tune of $4 billion for having caused them harm. On this occasion, the loss of profit by going for the slower but safer system of obtaining authorization caused them to violate the credo that has enlightened business for more than a century.

And finally... What has been the most favorable surprise you have had when teaching ethics class to your students? (The unfavorable one, if you like, we'll forget it).

There are many, mostly in the form of emails from students who comment after finishing the subject that it has changed the way they see many aspects of business. But receipt even more emails from alumni, asking me questions that arise in their work, because they want to do things right. I think that, evidently, not only because of my subject, but because of the whole educational project of the School and the University of Navarra and the example of the faculty and staff of the University, the students leave the classrooms technically well trained, but at the same time with a set of virtues and with the real and effective desire to be integrated people who seek to make this world a better place. At the end of her programs of study , a student came to my office to thank me for having taught her at the university to love people. This is the core topic to always succeed in professional practice and, in final, in life.