You just can’t get away from the “retention” bonuses that are plaguing AIG. Every Sunday-morning news show, newspaper, and magazine is talking about the new populism against these big financial service firms.  Whether you believe they are worthwhile or not, there is plenty of blame to go around… government, lack of accountability, unreasonable business practices during a time of crisis,

Now it looks like another 33% was paid out above the one-hundred and sixty five million we knew about.  It only came out when some state government folks asked for the paperwork.  So now we have moved this whole debacle into an ethical issue among senior leadership, instead of an issue of fairness.

So let’s go over the numbers from my company’s last national benchmark on workforce engagement.  First and foremost, Ethics, Diversity, & Safety is the second strongest driver of workforce engagement and has been for each of the last three biennial surveys.  And not surprisingly, it is the NUMBER ONE driver of engagement for the financial services industry. Go figure.  So let’s look at what employees in the financial services industry think about the ethics of their workplace…

In the 2008-2009 benchmark study in financial services, nearly as many employees were unengaged (thirty-five percent) as fully engaged (thirty-seven percent).  Another twenty-eight percent were trapped, reluctant to leave and reluctant to work hard.

• More than two-thirds of financial services employees agreed their organization was highly ethical, while only five percent disagreed.
• Six in ten believed that company policies were carried out in a fair and just manner, while one in six disagreed.
• Six in ten believed their company encourages open, candid communication while nearly one in five disagreed.
• Six in ten believed their senior leaders were people of high personal integrity, meaning four in ten financial services employees could not agree with the statement.

Doesn’t paint a very nice picture does it?

Ethics is a “top down” not a “bottom up” principle.  Day-to-day employees will look at the senior leaders when they are involved in an ethical decision.  If they believe their senior leaders will do the right thing, not put profits in front of ethics, they will do the same.  When they believe they know what their senior leaders mean when they say “take appropriate action with company files” as the leaders of Arthur Anderson did years back, they will wink, nod, and then shred like crazy.  Like they did.

Whether you believe the bonuses are right or wrong isn’t the issue anymore.  The issue is one of doing the right thing.  Being open, honest, and up-front.  Especially when people are waiting for you to lie.