What is the ethical thing to do when you hear a rumor? Corporate Secretary editor Matthew Scott says consider how people will react to information spread about you.
Many governance professionals complain about a lack of ethics in business. After all, you often find yourselves on the front lines of the movement for better corporate governance, fighting fraud and improving the ethical culture at your company.
But ethics can break down when rumors start to fly. How many people can honestly say they would pass up an opportunity to make money or eliminate a competitor if information contained in a rumor could help them do that?
So what is the ethical thing to do when you hear a rumor?
Every company will, at some point or another, be the subject of negative rumors. Often these are spread by competitors or disgruntled former employees with an axe to grind. This falls into the category of reputational risk, one of the biggest risks any company will face; and as former employees can be seen as having ‘reliable’ information because they’ve worked at the company they are secretly (or openly) trashing, it must be taken seriously.
When competitors and former employees are spreading rumors about your company, you have to rely on your established reputation in the marketplace, your personal relationships with key influencers in your industry and, of course, the fact that the rumors aren’t true. It would also be nice if you could rely on the ethics of those who are receiving the rumors, but unfortunately you cannot.
In the governance industry, just like in any other industry, people spread rumors all the time, but perhaps today we can adopt a stricter standard governing how we view rumors when they reach our ears. This is nothing new – just a cue to remember how you would like to be treated when the rumors about your company hit the grapevine.
When you hear a rumor, no matter how juicy it is, do you investigate? Why is this information being brought to you? You may need to question the ethics of the person bringing you negative information about another company he or she previously worked for (is that something you would do?). If you repeat the rumored information to the wrong people and it turns out to be false, your reputation may take a hit. If you change your business strategy without checking the information out, you may endanger your company’s shareholder value and your reputation – so be sure to do your due diligence.
Would you believe a rumor within your own company without investigating? Of course not – there are rules and procedures that must be followed to make sure all allegations are founded on truth. Make sure you take similar steps when information comes to you from outside your company. Someone may be trying to maneuver you into a bad situation by supplying you with bogus information about someone else. He or she may also be trying to sour your relationship with a competitor because the competitor may have a better product and can take business away from him or her. In business, when people pass information there is always an angle. Be sure you find out what it is.
As governance professionals, make sure the angle behind all rumors is an ethical one.
