In a world where money rules, doing the “right thing” often competes with ever-tightening budgets. When the pressure to meet financial goals heats up, people don’t mind cutting those corners, telling those little white lies, and putting profits before people because it’s quick, easy, and it delivers; but it’s dirty.

At some point in our careers, we have all probably witnessed behavior like this and possibly even acted that way ourselves in the face of intense pressure. But does such unethical misconduct actually deliver?

Good Ethics = Good Business

According to (the group who actually administers the “FORTUNE 100 Best Companies to Work For” survey), “the stock price growth of the 100 most ethical firms outperformed stock market and peer indices by nearly 300%.” In their words, good ethics = good business and conversely, bad ethics = bad business.potter box

“More than 50% of the largest corporate bankruptcies have happened due to unethical business practices.”

With all that being said, as leaders set the tone for their organizations, it’s important that they model the highest standards of ethical decision-making and behavior even amid the most challenging of circumstances. How can we help them do that?

The Potter Box: Making the Right Decisions

Ralph Potter Jr., a professor of social ethics at Harvard Divinity School, created the Potter Box to provide guidelines in helping people with ethical decision making. It focuses on four dimensions of ethical reasoning that include facts, values, principles, and loyalties. In that order, the tool offers simple steps to reason through ethical dilemmas and make a justified decision. Here’s how it works:

potter box

Step One – Look at the Facts: What do you know to be true about this situation?

Step Two – Examine Values: What do you value most? By being clear in what values are important to you, you have a solid way to evaluate potential actions.

Step Three – Examine Principles: By looking at your values through the lens of a different system of ethics, you can develop a range of possible actions. Some examples of principles include (but are not limited to):

Step Four – Determine Loyalties: Who or what are you loyal to in your situation? Establishing this will clarify your thinking and help set a clear direction for how to act accordingly.

These steps can be repeated as many times as needed to ensure alignment in the four areas.

Once a decision has been reached, all there is left to do is determine how to carry it out in a manner that is both effective and respectful. While the process above is very high level, when in doubt, check it out. The Potter Box might just be the golden ticket to keeping those high standards of ethical decision making intact.

[For more information and examples of this tool in action, please refer to (1) below.]

Good Ethics = Better Performance (And More)

In an article by the Huffington Post, professor David Meyer from the University of Michigan explains that, “in the past decade over 100 studies with more than 30,000 employees have consistently found that employees who believe their leader is ethical are happier, more committed, perform better, are more likely to be helpful to others and less likely to behave unethically.”

So the next time your budget season rolls around and the pressure to perform challenges your moral compass, how will ensure you’re not cutting corners, telling little white lies, or putting profits before people?

After all, when leaders are ethical, everyone wins.


(1) Media Ethics at Work: True Stories from Young Professionals. Lee Anne Peck and Guy S. Reel, Thousand Oaks: CQ, 2013.