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Ethics

Warren Buffett’s Rule of Thumb on Personal Integrity

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On occasion, personal integrity and ethical conduct can be challenging. Greed, selfishness, distrust and other inclinations can result in misrepresentations, deliberate omission of facts to throw a positive spin on things, purposeful oversight, misuse of information and self-interested behavior.

Warren Buffett, one of the world’s most successful investors and CEO of Berkshire Hathaway, directs that all his employees follow this rule of ethics in every undertaking.

“… I want employees to ask themselves whether they are willing to have any contemplated act appear the next day on the front page of their local paper—to be read by their spouses, children and friends—with the reporting done by an informed and critical reporter.”

The key to personal integrity is to gather all the relevant data, define the “right thing,” exercise prudence and standup for what is right. Good intentions do not necessarily translate to action. Your thoughts and actions define your credibility at work and in the society.

Credit: Warren Buffett’s picture courtesy of user ‘trackrecord’ on flickr.com

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On Recruiting from a Competitor

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In response to my statement on prohibiting current employees from disclosing proprietary information from their former employers, blog reader Alberto from Sao Palo, Brazil, questioned me on the ethics of hiring from a competitor.

Competitors are the principal, sometimes inevitable, source for talent with industry-specific skills and relevant experiences. At first sight, the proposition of hiring from a competitor sounds quite rational: the recruit may be well-trained at the competitor; he/she may be able to jump-start a new venture and establish a customer-network readily. However, depending on the position your recruit held at the competitor, this attempt might be fraught with problems–ethical and legal.

In today’s competitive marketplace for talent, an employee has a fair right to seek employment with competitors of his/her current employer. However, the loss of a key employee and the fear that the former employee may reveal trade secrets to a new employer may lead to contention between the new and former employers. A recent example: the bitter dispute between Google and Microsoft when Google recruited a Microsoft executive to lead Google’s research initiatives in China.

Essential Considerations for Recruiting from a Competitor

Here are three important guidelines to consider when recruiting from a competitor.

  • Take into account the costs of hiring and retaining your new recruit. The recruit is likely to command a premium over his/her benefits with the former employer. Further, if your new recruit will leave a competitor to join your organization, he/she could leave your organization in the future and return to the former employer or transfer to a third organization. What will motivate him/her to continue to stay with your organization on the medium- and long-term?
  • During the recruiting process, understand any non-compete or non-disclosure agreements your recruit may have entered with the former employer. Abide by any such commitments—for the duration of the non-compete or non-disclosure agreements, if possible, assign responsibilities that do not conflict with terms of these contracts. Consult legal experts to weigh any potential risks.
  • If the recruit had held a key position in the competitor, he/she likely has access to proprietary information or trade secrets of your competitor. Do not solicit any proprietary information about the former employer—this is unethical and may expose you to liability.

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Job Interviewing #2: Interviewing with a Competitor of your Current Employer

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Blog reader Ranganathan from Toronto, Canada asks, “I am interviewing with a competitor of my current employer. Most of my work at my current employer is confidential. How do I describe these projects in the upcoming interview?”

Ethics and Responsibilities

Interviewing with a Competitor of Current Employer: Ethics, Responsibilities Your employers, both current and former, expect you to treat sensitive and confidential information ethically. Accordingly, you must not disclose such information outside the company—in an interview, trade show or party at home.

During an interview with a competitor of your current or former employer, describe your past projects and accomplishments in terms of concepts and particulars that are public knowledge. If the interviewer presses for additional information, be diplomatic and decline to present confidential information. Interviewers will appreciate your reluctance.

Beware of a Trap: Test for Integrity

Interviewing with a Competitor of Current Employer: Test for Integrity Public trust and ethical behavior are vital to organizational and individual success. Recent corporate scandals have underscored the need for organizations to build and foster ethical business environments. Organizations are therefore inclined to select employees who share such moral values.

Good corporate ethics policies prohibit current employees from disclosing proprietary information from/about their former employers. In asking you for sensitive information, the interviewer is probably setting up a trap for you—the interviewer may be checking if you demonstrate a high degree of integrity and professional conduct.

Declining to provide proprietary information will demonstrate your consideration of the ethical consequences of your actions. Consequently, you will earn the respect of the interviewer.

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