An important premise of this book is that if an organization institutionalizes ethics, it is unlikely to find itself trying to recover from a fall or having to undertake an ethics turnaround, as did Salomon Brothers and Enron. Institutionalizing ethics may sound ponderous, but its meaning is straightforward. It means getting ethics formally and explicitly into daily business life. It means getting ethics into company policy formation at the board and top management levels and through a formal code, getting ethics into all daily decision making and work practices down the line, at all levels of employment. It means grafting a new branch on the corporate decision tree—a branch that reads “right/wrong.” 1
Institutionalizing ethics is an important task for today's organizations if they are to effectively counteract the increasingly frequent occurrences of blatantly unethical and often illegal behavior within large and often highly respected organizations. The institutionalization and management of ethics is a problem facing all types of organizations—educational, governmental, religious, business, and so on.
It would seem to be good strategy for an organization to be concerned about and adopt institutional ethics. An organization that is truly interested in bringing about a long-term ethical system, must first