Would the Code Make a Difference?

Even if a code such as the one we have proposed were to garner sufficient support to be broadly adopted by the profession, you might argue that codes are merely motherhood and apple pie statements that carry no credible moral force to reliably shape behavior. Look at Enron, one might say: The company’s code of ethics was widely lauded; now it has become a symbol of the firm’s deceit. If a company, a relatively small and coherent social group, can’t enforce such codes, why would one imagine that a larger collective such as a profession might be able to?

The answer can be found in the work of political scientist Robert Axelrod. His work suggests that a shared ethical orientation and set of common ideals at the professional level may be crucial in guiding the behavior of individuals at the company level. The ideals, or meta-norms as Axelrod calls them, emerge partly out of an inward sense of vocation—a conviction that one is doing work that is meaningful—but are also grounded in a commitment to peer sanctions and monitoring. For example, U.S. military cadets promise “not to lie, cheat, or steal”; they also promise “not to tolerate those who do.” In this way, according to Axelrod, meta-norms contribute to the self-governance capability of a profession: Managers who swear to uphold a common professional code, understanding that if they violate the code they might suffer sanctions administered by their peers, are more likely to adhere to individual company codes.

Would instituting a code increase the likelihood that acts of gross management malfeasance would be brought to light? Many people would say no. Whistle-blowing or bringing attention to the misconduct of a peer is arguably even rarer in a true professional setting than in nonprofessional settings. In some professions, such as the police, exposing a colleague is almost taboo. Such arguments have merit, but when people fail to self-monitor, it doesn’t negate the argument that they should. Indeed, when self-policing becomes weak, it is often time for the profession and its individual practitioners to recommit to their social contract—or risk losing society’s trust, as the accounting profession discovered and the financial services industry is now discovering.

If management were to be seen as a true profession, our expectations of the moral conduct of managers and their expectations of themselves would rise.

We believe that professionalizing management would greatly curb misconduct, because moral behavior is an integral part of professionals’ identity—a self-image most want strongly to preserve. Though we are often shocked when doctors or lawyers misbehave or condone the misbehavior of their own, at least we are shocked. We expect better from them. In the case of comparable malfeasance in business, we are no longer even shocked that it occurs or that it is not more commonly reported. Although the implicit contracts that society has with true professions—we grant you privileges because we trust you to self-govern—aren’t always upheld, they do establish a higher expectation of self-governance than in a non-professional setting, and thereby a higher degree of censure when expectations are violated. We know from social science that the behavior of human beings is greatly influenced by the expectations placed on them. If management were to be seen as a true profession, our expectations of the moral conduct of managers and their expectations of themselves would rise.• • •

We don’t pretend that this essay or our code is anything like the last word on the topic. The debates about management education and the regulation of businesses will never go away, and in a constantly changing world there is no perfect solution. The U.S. constitution is arguably the finest and most durably written constitution that has ever existed. Yet its approval was the result of much wrangling and debate between two sharply opposed philosophies of government. Over the years, the document has evolved through the painstaking passage of amendments and the interpretation of the courts. The process of agreeing to and adapting a code of professional management is unlikely to be as contentious, but in a global world it could be even more difficult.

A version of this article appeared in the October 2008 issue of Harvard Business Review.