Fighting Ethical Disconnects in Corporate Culture

Well, it’s happened again: managers at a large company did something contradictory to a good corporate culture and common social mores, and made the company look terrible to the public. 

U.S. Bank, welcome to the hot seat. 

You may have seen the article in the New York Times that started all this. Nicholas Kristof, a columnist who often writes about Americans getting a raw deal they don’t deserve, noticed the plight of Emily James. She was manager at a call center U.S. Bank runs in Portland, Oreg. — and last month, U.S. Bank fired her for lending $20 to a customer who needed gas money to get home on Christmas Eve. 

Now, you already winced at that last line, right? That alone demonstrates the innate sense of ethics and fairness most people have. So let’s see how U.S. Bank lost that ethical sense at the corporate level, because preserving it at the corporate level is so crucial to corporate ethics and compliance today.

Back to James. She was trying to help Marc Eugenio, a U.S. Bank customer who had made a deposit of $1,080. The payment hadn’t cleared, and for several days before Christmas Eugenio had visited U.S. Bank branches trying to get the payment processed so he could buy gifts for his children. bank employees kept telling him the deposit would clear “soon” but it never did.

By Christmas Eve, Eugenio was stuck at a gas station with no gas and no money, miles from home, while he kept trying to use his debit card at the pumps over and over — for hours. So he called U.S. Bank’s call center, and ended up speaking to James. 

James realized Eugenio was not going to get that $1,080 deposit cleared any time soon. She also realized he was a short ride from her office. So, with permission from her supervisor, James drove to the gas station and gave him $20. Eugenio tanked up and went home. 

In response, U.S. Bank fired James and the supervisor who allowed her to meet Eugenio. They had violated company policy that prohibited call center employees from meeting customers in person. A spokesman for the bank told Nicholas Kristof that James had misled her manager into granting permission, and that James had previous disciplinary issues — nevermind the positive performance reviews and commendations James had received in her two years with U.S. Bank, which you can see in photos that accompany Kristof’s column.

We all know how a story like this ends. Kristof published his column, and within hours he got a phone call from Andrew Cecere, U.S. bank’s CEO. Cecere claimed he was aghast at James’ treatment, and said, “This is not who we are.” Then came a statement on the bank’s website apologizing for what happened to James, and promising the usual review of policies and procedures so something like this doesn’t happen again. 

Culture and ‘Not Who We Are’

I’m always intrigued when a CEO points to some incident of policy gone wrong and says, “That’s not who we are as a company” — because clearly it is who they are as a company at least sometimes, because the incident happened. 

Well, why? What’s the disconnect between senior and junior executives that allows mistakes like this to happen, even when everyone believes they’re doing the right thing? 

I focus specifically on upper middle management. Those are the people paid to implement company policy as uniformly as possible. They’re just far enough removed from the facts of any given case that they can lose empathy with the employee involved, and loss of empathy is where everything can start to go wrong. 

Remember at the top of this column, where I said you probably winced at “fired for helping a customer on Christmas Eve”? That was empathy. You were presented with a set of facts, and before we got to any details about U.S. Bank’s policy, you could already grasp the ethical impulse James felt for Eugenio, and the wrongness of punishing her for it.

So one point to remember is that empathy and ethical norms are deeply entwined. The more you create management structures that distance decision-makers from empathy for the players involved, the more you’re at risk of making decisions at odds with ethical values.

To be clear, banks are wise to have a policy against call center reps meeting customers. There is risk of fraud and even personal safety. Having the policy is good — but like any other policy, it should have a procedure to ask for exceptions. And that procedure should give room and encouragement for managers to exercise empathy.

I’m not saying that managers should be suckers for every sob story that comes along. But when managers are asked to grant a policy exception, we’re asking them to make a judgment. They need to make the best judgment possible, and one component of that includes considering the ethical dimension: regardless of what the policy says, is what we’re proposing to do right? Empathy is how you answer that question as wisely as possible. 

On a practical basis, that means drilling empathy and ethical awareness into the heads of upper-middle management as much as possible. It means training. It means the CEO talking about ethics in those senior staff retreats. It means the company encouraging upper-middle managers to use judgment — and to trust their exercise of judgment.

After all, those management structures that distance upper-middle decision-makers from empathy for specific cases — those structures are a fact of life. Large organizations need them. There are no controls that “force” empathy into structured decision-making, so really it depends on senior leaders conveying that message via training and discussion. That’s how we can get better consideration of ethics in the moment. 

Because, as U.S. Bank shows, it’s really painful to consider ethics in hindsight.