BMO Financial Group is taking a unique approach to building a more ethical culture and assessing staff perceptions
Written by Ula Ubani
An ethical culture is critical to a business’s long-term success and begins with organizational values and ethical leadership. But what does that mean in an everyday work environment? How do we make it real? How do we know we are getting it right?
In many companies, the compliance and ethics functions are combined. These organizations may have fairly evolved compliance and ethics programs, strong internal controls, codes of conduct, and regular ethics training. The question to ask is whether these elements alone are enough to ensure an ethical culture. In contemplating this question at BMO, we decided to separate the ethics function from compliance to further promote positive ethical principles across the bank.
Generally, culture is the sum of the attitudes, behaviors, and beliefs of a group of people. If we accept this definition, then in addition to having proper controls in place to safeguard against improper behavior, we also need to understand the impact of employee beliefs and attitudes on decision making in the workplace.
Employees make behavioral decisions according to their personal values. We accept that we can’t regulate behavior or change people’s values; however, we can make sure that every employee understands what BMO’s values are, what they mean, how they relate to their work, and our expectation of their behavior.
At the same time BMO revised its ethics structure, we also re-examined our values to ensure they remained relevant and meaningful to employees and supportive of our brand promise. We undertook a co-creation exercise involving a large number of employees from the most junior to the most senior across the bank in several iterative sessions to tease out what collective values might look like. Under the stewardship of the CEO, we gathered the views of our employees and re-expressed our values to reflect what we heard.
The next challenge lay in making the values real to employees. To address this, we are developing a behavioral model aligned with our values, our code of conduct, and our brand to provide guidance in decision making for all employees. We plan on weaving application of the values into leadership competencies, performance evaluations, and training and development.
These are the building blocks to an ethical culture; however, beyond that, we recognize we still need to work on attitudes and creating an environment where employees feel empowered to make decisions in line with our expected behaviors, challenge others around them that do otherwise, and raise concerns if they are having difficulties or are unsure. In addition to our behavioral model and regular training, time needs to be spent with the leaders and employees in our various businesses to heighten their awareness of the elements that contribute to an ethical culture and provide support to them where it’s needed.
There isn’t one perfect measure to determine whether we are hitting the mark on ethical culture, but right now we are tracking employee perception and attitudes. We have added specific questions to our annual employee survey to measure whether employees feel that we demonstrate an ethical environment, how comfortable they are raising issues, and whether they have confidence that issues raised will be handled. The insights we gain through the responses provides us with a good sense of where the gaps are and where our efforts should be focused. The work around ethical culture is ongoing, but having foundational elements such as clear values and expected behaviors in place puts us in a good position.
