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Three academic works on compliance and ethics that you should read.

August 8, 2018 7:52:18 AM CDT / by Ricardo Pellafone

At the moment, we’re doing a lot of strategy, research, and product development. I’m not gonna go into details, but it involves a patent filing and me looking out the window of our office a lot ("you guys, the future! Also, the dumpster! Our view isn't great!"). 

And while I’m doing that, here are a few academic works that are shaping how I think about what we do next. I think these are important and I decided to write them up to encourage you to read them, too. (Plus I've been linking to a lot of Vines lately, so I figure this will balance things out.)

Oh, disclosure: I've spoken in some way to all three of these academics, and we’ll be cited in an upcoming article from Todd Haugh (more on that later). We have no financial relationship with any of them.

 

#1: How to evaluate if your ethics and compliance strategy is ethical

The work: The Ethics of Intracorporate Behavioral Ethics, by Todd Haugh. It’s freely available online here.

What it’s about: The ethics of corporate ethics and compliance tactics—when nudging and training and predictive analytics are ethical, and when they're being used in an unethical way.

Why you should read it: Because the compliance-and-ethics job is a job. And just like any other job, it's possible to do it unethically. Haugh walks through a framework for analyzing this.

Here's why it's relevant for training in particular: the trend in compliance training content is towards media-rich, emotionally evocative content, empowered by technology and structured from lessons from behavioral science—and that is dangerous.

That is, as we get more sophisticated, there’s a serious risk of compliance training becoming more like the worst parts of advertising. When I say "the worst parts," I mean the parts that don't appeal to your reasoning to get you to do things, but look to override or circumvent it by targeting your emotions and sense of self and then follow you all over the internet with tracking cookies until you give in.

And if you think that stuff feels manipulative and creepy, well, it's probably something we shouldn't emulate.

The antidote for this isn’t to retreat from technology or media or the application of behavioral techniques. It’s appreciating that these things are powerful and dangerous and require thoughtful reflection because they involve trade-offs—and just like we want employees to do their jobs the right way, we have to appreciate that there are right and wrong ways to do our jobs in compliance and ethics, too. Haugh lays out a nice framework for thinking about that in this article based on considerations of rationality and transparency.

Now, if you’ve never thought about this type of thing—that there could be an unethical way to get people to make ethical decisions—then congrats, you’re human. It’s really hard to remember to think about the “how” unless someone tells you; that's the point of the next article.

 

#2: How to explain why someone who takes your training can still do something shady

The work: Why It’s So Hard to Train Someone To Make An Ethical Decision,  by Eugene Soltes. Freely available here at the Harvard Business Review.

What it’s about: The title on this one is pretty descriptive. This is the most accessible thing we're recommending—it's probably more accurately described as a practitioner article written by an academic.

Why you should read it: Because it very simply lays out the problem with formal training: it’s easy to get the questions right because you know you’re supposed to be thinking about ethics, you get multiple viewpoints, and you have time to think about ethics in the first place.

In the real world, you usually don’t.

And that means we need to worry less about quiz results and three-year plans and more about how we can build systems that flag these issues for people, because that’s where the problem often lies. Put otherwise, the basic problem isn’t knowledge; it’s recognition.

This theme undergirds a lot of Soltes’ book, too, which has the additional bonus of giving you an insight into what it would be like to be Bernie Madoff’s pen pal. No, seriously: he became pen pals with Bernie Madoff, and I don't know why that wasn't the title of the book. You can buy that book here.

 

#3: How to use science to take a problem-solving approach to compliance strategy

The work: The Law of Good People, by Yuval Feldman. You can buy the book here.  

What it’s about: Behavioral ethics—specifically, how the findings from that field should drive how we design systems and policy. Here's a nice Q&A that will give you a sense of what's covered.

This is probably the most academic of the three: you’ll get through it faster if you have some kind of grounding in law, economics, or behavioral science. (It's not necessary, but it'll help.)

Why you should read it: This short, dense book does a great job of weaving the behavioral ethics research into a cohesive framework for analyzing a compliance problem; that is, for getting people to do the right thing in a particular circumstance.

Our field is often inundated with quick fixes—get this certification, use this microlearning, rebrand this thing—and this book is a refreshing counterpunch to that mentality. It's a thoughtful framework that incorporates context and tradeoffs in its recommendations, because there is no silver bullet that will tackle every situation. It's framed around public policy, but it's not hard to see the corporate application.

The behavioral research in this book often challenges or just straight-up demolishes core assumptions we've held in the practitioner space—for example, did you know that writing the disclosure at the top of this article actually made me more likely to exploit the conflict?

Yes! And yikes, right? The magic of this book is how it synthesizes startling, granular findings like that into a framework for analyzing a particular compliance challenge.

Ricardo Pellafone

Written by

Ricardo Pellafone

Ricardo used to be in-house compliance, leading investigations for a sovereign wealth company in Abu Dhabi and a Fortune 500 tech company in California. He has degrees in psychology and law.