- ASC Proceedings of the 38th Annual Conference
- Virginia Polytechnic Institute and State University - Blacksburg, Virginia
- April 11 - 13, 2002 pp 177-182
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Foundations of Ethical Judgment in Construction
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L. Gregory Ohrn Northern Arizona University Flagstaff, Arizona |
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The construction industry needs to create a more professional work environment in order to attract the best and brightest leadership that the industry will need in the future. This type of professional work environment can only be created by strict adherence to a strong code of ethics. A limited number of firms in the industry have already recognized this fact. These firms typically state that one of their most valuable assets is their reputation and that their reputation is directly related to their ethical behavior. The construction industry as a whole will be better off when the majority of the firms recognize the value of good reputation and how this reputation is directly related to ethical behavior. A trend toward a more ethical and professional work environment will allow the construction industry to better compete for the talented leadership that will be needed in the future.
Key Words: ethics, morals, values, and education |
Introduction
Ethical judgments are the basis by which many of the decisions in the construction industry are made. Examples of these ethical judgments might include the following:
Is it appropriate for a general contractor to solicit a lower bid from a subcontractor by revealing the bid amount from the subcontractor’s competitor?
Is it appropriate for a contractor to front-load the schedule of values, or the unit price line items in a contract in order to maintain a positive cash flow?
Is it appropriate for an owner, contractor, or subcontractor to delay payment to their contracting partners and suppliers in order to gain interest on the delayed payment amount?
If these are examples of ethical judgments, why is it important to the construction industry to understand the foundations of ethical judgments? Why not just take a purely business approach to answering these questions – minimize cost and maximize profit? The answers to these questions lie in the general perception of the construction industry. In recent public opinion surveys, construction has consistently been rated very low as a profession that parents would like their children as a recommended career to choice. With this type of public perception of the construction profession, how will the construction industry attract the best and brightest students when making their career choices? Perhaps the construction industry needs to take an inward look and improve its public image. One place to begin this type of self-examination might be with the question - What are the foundations of ethical judgment in construction?
Background
According to Webster’s Dictionary (1977) the word ethical means, "conforming to accepted professional standards of conduct." The Encarta Dictionary (2001) goes on to define ethics as, "a system of moral principles governing the appropriate conduct for an individual or group." Encarta continues by defining moral as, "based on what somebody's conscience suggests is right or wrong, rather than on what the law says should be done."
It might be helpful in looking at the foundation of ethical judgments in construction to look at how the engineering profession defines ethics. Martin and Schinzinger (1989) in their book Engineering Ethics have defined "engineering ethics" as "the study of the moral issues and decisions confronting individuals and organizations involved in engineering; and the study of related questions about moral conduct, character, ideals, and relationships of people and organizations involved in technology management."
From this background, it appears that ethical foundations are based on morals and values as these concepts relate to the relationships between individuals and organizations. To gain a better perspective of how these concepts relate to the construction industry, it might be of benefit to look at how some construction organizations and firms define their ethical responsibilities.
Ethics in Construction
Ethics in construction can be seen in a number of actions and statements, but possibly one of the better ways to get a sense of how the construction industry views ethics is to look at the code of ethics, value statements, and mission statements of the organizations and firms involved in the construction industry. What do these codes, values, and mission statements have in common? What can we learn from these sources that give us insight into the foundations of ethical judgments?
Construction Management Association of America
The Construction Management Association of America (2001) represents the interests of professional construction managers by "enhancing their performance and capabilities and improving their business results." This association’s code of professional ethics of the construction manager states the following:
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"As a professional engaged in the business of providing construction management services, and as a member of the CM profession, I agree to conduct myself in my business in accordance with the following:" |
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"Client Service. I will serve my clients with honesty, integrity, competence, and objectivity, establishing a relationship of trust and confidence and furnishing my best skills and judgment consistent with the interests of my client." |
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"Representation of Qualifications. I will only accept assignments for which I am qualified by my education, training, professional experience and technical competence, and I will assign staff to projects in accordance with their qualifications and commensurate with the services to be provided." |
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"Standards of Practice. I will furnish my services in a manner consistent with the established and accepted standards of the profession and with the laws and regulations which govern its practice." |
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"Fair Competition. I will build my professional reputation on the basis of my direct experience and service provided, and I will compete fairly and respectfully with my professional colleagues." |
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"Conflicts of Interest. I will seek to avoid any and all conflicts of interest and will immediately acknowledge any influences and offer to withdraw from any assignment when any actual conflict exists which may impair my objectivity or integrity in the service of my clients." |
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"Fair Compensation. I will negotiate fairly and openly with my clients in establishing a basis for compensation, and I will charge fees and expenses that are reasonable and commensurate with the services to be provided and the responsibilities and risks to be assumed." |
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"Release of Information. I will release public statements that are truthful and objective, and I will keep information and records confidential when appropriate and protect the proprietary interests of my clients and professional colleagues." |
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"Public Welfare. I will not participate in any racial, sexual or political discrimination related to any assignment I may undertake. I will avoid any conduct that would be considered unethical or will interfere or conflict with any laws, statutes or regulations, and I will uphold the safety, health and welfare of the public in the performance of my professional duties." |
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"Professional Development. I will continue to develop my professional knowledge and competency as a practitioner, and I will contribute to the advancement of CM practice as a profession by fostering research and education and through the encouragement of subordinates and fellow practitioners." |
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"Integrity of the Profession. I will avoid actions which promote my own self-interest at the expense of the profession, and I will uphold the standards of the construction management profession with honor and dignity." (Construction Management Association of America, 2001). |
The Construction Management Association of America is promoting itself as a professional association of the highest ethical standards. This is being accomplished by requiring its members to promote the profession in a morally appropriate manner that reflects the values of the association (honesty, integrity, competence, objectivity, and fairness).
Bechtel Group
The Bechtel Group has been a highly rated contractor for several decades and provides services in several areas of the construction industry. Bechtel simply states its corporate ethics in the following statement:
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"Bechtel's culture is grounded in integrity and respect. At Bechtel this means adhering to the highest standards of ethical business culture, and our reputation for adhering to these standards is one of our most valuable assets. We stand by everything we do." |
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"Bechtel does not tolerate behavior that is not fair and ethical, and all employees are required to comply with these standards and with applicable local, state, federal, and in-country laws." |
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"Bechtel is a member of Transparency International, a non-governmental organization dedicated to increasing government accountability and curbing both international and national corruption." (Bechtel, 2001). |
Bechtel acknowledges in this statement that their reputation is one of their most valuable assets, and that the way they plan to maintain that asset is by adhering to the highest standards of ethical business culture. Bechtel further supports this asset by stating that they will not tolerate behavior that is not fair and ethical. In other words, there is accountability for failing to adhere to this organization’s ethical standards.
Barton Malow Company
The Barton Malow Company is a large construction contractor that has a nationwide presence. In a message from the Ben Maibach III (President of Barton Mallow) on the subject of the value of ethics, the following statement is made:
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"The construction industry is very competitive due to an over capacity of firms competing for work. When all things appear equal, I believe our profitability may depend on our good name. An excellent reputation is a differentiating competitive advantage. The reputation Barton Malow has earned is significantly impacted by our business ethics." |
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"The perception of Barton Malow starts with each employee. Every action we take portrays an element of character that has the power to build (or destroy) our reputation. Companies with good reputations do more than just follow the law; they treat people and other businesses fairly - whether the law requires it or not." |
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"Pressure to get new work, to reduce projects costs or to complete projects on time, are all factors that may cause a less than ethical mode of conduct. People tend to rationalize unethical behavior by saying, "That's business." I do not believe being unethical is a way to run business. Throughout our business career and long after, our reputation will be known and remembered." |
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"There are many benefits of strong ethics. When we operate with ethics, we create an atmosphere of trust and increase client satisfaction. Ethics help foster a positive image and encourage other firms to want to do business with us. Firms that operate ethically are known in the industry, which makes it easier to recruit respected individuals." |
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"While ethics include the moral code we live by and our personal reputation, the fact is that strong ethics are good for business. I encourage Barton Malow personnel to make ethical decisions and support the positive reputation Barton Malow has earned over many years." |
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"Whether we are at work or on our own time, I believe we should all maintain our principles and beliefs and enjoy the benefits of living an ethical life." (Maibach, 2001). |
The president of Barton Malow is stating in no uncertain terms that he feels the success of the company is directly tied to the reputation of the company, and that the reputation of the company is represented in the actions of its employees. Barton Malow’s president continues on to state that every action taken portrays an element of character that either helps build or destroy, the reputation of the company. Barton Malow believes that unethical behavior cannot be rationalized. In other words, you cannot separate a business or personal decision from an ethical decision.
American Institute of Constructors
The American Institute of Constructors is an organization of individual construction practitioners that promotes the professional status of its members. The Institute provides the construction industry with a professional organization that is the constructor’s counterpart to professional organizations found in architecture, engineering, law, and other professional endeavors. The stated purposes of this institute are to promote excellence in construction by:
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"Establishing high standards of ethics and competence for the professional" |
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"Recognizing the professionalism of individual constructors" |
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"Promoting the study and advancing the practice of construction related fields" |
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"Facilitating the exchange of information and ideas within the profession" |
The American Institute of Constructors states its code of ethics in the following manner:
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"A member shall have full regard to the public interest in fulfilling his or her responsibilities to the employer or client." |
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"A member shall not engage in any deceptive practice, or in any practice which creates an unfair advantage for the member or another." |
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"A member shall not maliciously or recklessly injure or attempt to injure, whether directly or indirectly, the professional reputation of others." |
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"A member shall ensure that when providing a service which includes advice, such advice shall be fair and unbiased." |
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"A member shall not divulge to any person, firm, or company, information of a confidential nature acquired during the course of professional activities." |
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"A member shall carry out responsibilities in accordance with current professional practice, so far as it lies within his or her power." |
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"A member shall keep informed of new thought and development in the construction process appropriate to the type and level of his or her responsibilities and shall support research and the educational processes associated with the construction profession." (American Institute of Constructors, 2001). |
There are a lot of similarities between the code of ethics of the American Institute of Constructors and the code of professional ethics of the Construction Management Association of America. Both of these organizations are promoting the interests of the construction profession by emphasizing the importance of their members behaving in an ethical manner.
Foundations of Ethical Judgment in Construction
What do these codes of ethics have in common? What can we learn from these organizations about the value of ethical behavior in the construction industry? In reviewing the ethical statements of the organizations above, it appears as if the foundations of ethical judgments lie in the following:
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Morals – This is our personal sense of what is right or wrong behavior. Moral judgments must consider all of the ramifications of the judgment. Examples of these ramifications could include: |
o Will a decision adversely affect the reputation of the organization or individuals working for the organization?
o Could a decision adversely affect the organization's ability to get work in the future?
o What are the effects of a decision on our relationships with our construction partners such as the subcontractors and suppliers?
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Values – These are the principles, standards, and qualities that we as individuals and organizations feel are important. Construction organizations generally state they value principles, standards, and qualities such as: |
o Honesty
o Integrity
o Competency
o Objectivity
o Fairness
But ethical judgments extend beyond these foundations. Ethical judgments need to be exercised by individuals of character (Gill, 2001). These are individuals that have the strength of their convictions and that exercise their ethical judgments in a consistent manner. This is the pattern of behavior that we display as individuals and organizations (Headley, 1998). As an example of character, do we honor our verbal commitments all of the time, or do we only honor our verbal commitments when it is convenient? In addition, do we only behave in an ethical manner when there is no pressure to do otherwise, or do we have the strength of character to behave in an ethical manner when tough decisions need to be made?
Recommendations
If there is one thing to be learned from a review of the organizations discussed above, construction professionals can behave in an ethical manner and still be successful. The construction industry and construction education need to continue to emphasize ethics as an essential component of the construction profession.
If the construction industry is going to meet the technical challenges of the 21st century, it will have to attract its fair share of the best and brightest students. In order to provide the necessary appeal to these future generations of constructors, the construction industry needs to provide a professional working environment. This professional working environment must be based on a foundation of uncompromising ethical standards designed to promote the reputation of the construction industry as an honorable profession. These are the standards of a profession that will encourage parents to recommend construction to their children as good career choices.
In addition, ethics need to be taught and emphasized in our construction management programs. The American Council for Construction Education requires at least one semester hour of ethics as part of its accreditation requirements, but how is this being taught? Ethical issues are at hand in almost every aspect of the construction management process. Perhaps construction management education should look at incorporating the study of ethical issues into the curriculum of a broad spectrum of subjects, including as examples:
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Estimating and bidding – Is bid shopping and bid peddling appropriate behavior for a construction professional? |
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Project Management – Is it appropriate to front-load the schedule of values and to delay payments to subcontractors and vendors? |
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Soils and Concrete – Is it acceptable to modify laboratory and field test results in order get passing results or to achieve higher monetary returns on end-result payments? |
Students graduating from construction management programs will face all of these ethical issues and several others when they enter the construction profession. Will they be prepared for these challenges? Will they have been taught that values such as honesty, integrity, competence, objectivity, and fairness are at least as important as the technical competencies that they have been taught?
Conclusions
Ethical judgments are the basis of many everyday decisions in the construction industry. Each of these ethical judgments has the potential to promote or detract from the reputation of the construction industry as an honorable and ethical profession. It would be in construction’s best interest to promote the industry as a profession of the highest ethical and moral standards, an industry where the values of honesty, integrity, competence, objectivity, and fairness play an important role in our professional relationships. Only by creating this type of professional workplace will the construction industry continue to be able to compete for the best and brightest talent that will lead this industry into the future.
References
American Council for Construction Education (2002). Standards and Criteria for Baccalaureate Programs [WWW document]. URL http://www.acce-hq.org/Forms/FORM103.doc
American Institute of Constructors (2002). Code of Ethics [WWW document]. URL http://www.aicnet.org/ethics.htm
Bechtel Corporation (2001). Ethics [WWW document]. URL http://www.bechtel.com/ethics.htm
Construction Management Association of America (2001). Code of Professional Ethics of the Construction Manager [WWW document]. URL http://www.cmaanet.org/find/code_of_ethics.htm
Encarta Dictionary (2001). URL: http://encarta.msn.com/
Gill, Jr., J. H. (2001). Ethics [Slide Presentation]. Louisiana State University, Baton Rouge, LA.
Headley, S. (1998, Summer). Ethical Foundations of Education [WWW document]. URL http://www.cis.georgefox.edu/sheadley/Edpage/edm_544/ethicsohs/test3/sld001.htm
Maibach, III, B. (2001). The Value of Ethics [WWW document]. URL http://www.bartonmalow.com/overview/overview.htm
Martin, M. W. & Schinzinger, R., (1989). Ethics in Engineering, 2nd ed., McGraw-Hill Publishing, New York, NY.
Webster’s New Collegiate Dictionary (1977). C. & G. Merriam Co., Springfield, MA.