Surge of Interest in Ethics. as Scandals Hit Business, Ethics Consultants Find There's a Boom for Their Services

Article excerpt

THE chief executive officer of a large research-and-development company in the Washington area recently approached Prof. Donald Brenner, lamenting the fact that his middle- and upper-level management lacked ethics training, and asked his help.

"When companies read in the paper about problems in other companies, they get concerned," said Mr. Brenner, who teaches in American University's Kogod College of Business Administration.

Whether you call it criminal action or a lack of ethics, business is increasingly concerned about such conduct and its effect on the bottom line. With scandals rocking the savings-and-loan, defense, and securities industries, companies are increasingly seeking outside help from law and accounting firms, business professors, and other consultants.

"There has been a tremendous growth of interest in ethics programs in companies that have experienced deregulation during the last five years - telephones, banks, financial institutions, and others whose relationship to its customers and other stakeholders have gone through major changes," says Kirk Hanson, a business ethics consultant and senior lecturer at Stanford University's Graduate School of Business.

Although the growth of ethics programs is difficult to quantify, "there's no question that this kind of activity is on the uptick," says Gary Edwards, executive director of the Washington-based Ethics Resource Center, a nonprofit organization that consults to business and government.

Codes are becoming "more of a positive statement rather than a negative one," says John Cooper, a senior research fellow with the Ethics and Public Policy Center, a nonprofit think tank in Washington. They are geared "toward articulating a corporate mission."

The use of ethics training and new codes has soared, according to a survey of 2,000 companies to be released later this year by the Ethics Resource Center. But Mr. Edwards says the surge "is almost certainly headline driven."

Others, however, aren't quite so skeptical.

"The principal difference between now and five years ago is that most companies thought that a compliance program was passing around a code of ethics and having employees sign," says Robert Kenney Jr. …