Welcome to the wild and untamed world of human dishonesty

No one likes a cheater. From the kid who pays someone to take the SAT for him to the businesspeople who line their pockets by defrauding others, such people receive our harshest moral judgment. We shake our heads and wonder what kind of world we live in where many of the best and the brightest are caught taking shortcuts. We ask: What were they thinking? How could they have acted in a manner that lacked all moral common sense and harmed so many people? How can they live with themselves?
 
So if we hold cheaters in such low esteem, why do we all cheat?
 
This is one of several provocative questions Dan Ariely poses in his book "The (Honest) Truth about Dishonesty: How We Lie to Everyone-Especially Ourselves." You may not have robbed a bank or defrauded investors, but, according to Ariely, if you are human, you have been dishonest or broken the rules at some point in your life. You’ve "borrowed" supplies from the office, parked illegally, run red lights, "shaded" the truth to put yourself or your products in the best light, driven faster than posted speed limits, downloaded pirated music or movies, failed to report every penny of your income to the IRS, fudged an expense report, rounded up billable hours, slow-paid creditors or engaged in some other form of rule-breaking.
 
Ariely’s worldview is captured well by Groucho Marx, whom Ariely quotes in his introduction as saying: "There’s one way to find out if a man is honest-ask him. If he says ‘yes,’ he’s a crook."
 
Ariely supports his assertion on the ubiquity of dishonesty by sharing the results of research he did to discover not just whether we cheat but the circumstances under which it is most likely. He begins by introducing the "Simple Model of Rational Crime." SMORC proponents assert that we all tend to pursue our own self-interest without regard to principles of right and wrong. According to this model, our behavior is governed entirely by a rational consideration of the risks and rewards associated with any particular dishonest act.
 
Ariely observes that we clearly do not live in a SMORC world, because the vast majority of us refrain from stealing from one another even when the chances of getting caught are low. It’s the rare person, for example, who makes a habit of checking car doors in parking lots, looking for opportunities to pilfer the contents of those left unlocked.
 
Nevertheless, Ariely’s research demonstrates that a majority of us will cheat, up to self-imposed limits, when given the opportunity. One experiment he conducted involved giving volunteers a page of relatively simple math problems and asking them to solve as many as they could in 10 minutes. Participants were told they would be paid 50 cents for every correct answer. Members of the control group were required to hand their test papers to a proctor who graded them and paid the volunteers, thus eliminating any chance of cheating. Repeating this experiment many times determined that the average number of correct answers for any group was four.
 
Ariely then gave the same test to other volunteers but let them declare how many correct answers they had and then send their test papers through a shredder. The average number of correct answers reported by these text subjects was six-a clear sign that when given the opportunity, people cheat.
 
Interestingly, the amount of cheating that occurred in these tests was virtually independent of the amount of money paid for each correct answer. Ariely varied the proffered reward from 25 cents to $5, yet the level of cheating stayed the same, except when the payments were at the highest level. When test subjects were offered $5 for every correct answer, the rate of cheating went down. This is clearly at variance with what would be predicted by the SMORC and raised questions about what really goes on in the mind of the cheater.
 
Other experiments Ariely performed illustrate further the complexity of human dishonesty. He observed benevolent behavior by taxi drivers and street merchants who acted against their economic interests by being more generous to a blind person than they were to seeing customers. Other studies demonstrated that signing a pledge to be honest or even being asked to think about the Ten Commandments prior to taking the math test virtually eliminated cheating. Ariely also discovered a significant decrease in cheating when signature blocks certifying honest reporting were placed at the beginning rather than at the end of insurance claims forms. By contrast, his studies showed that even sustained honor code programs like those at Princeton University have only a limited beneficial effect.
 
We might not like to acknowledge the accuracy of Ariely’s research results because of what they seem to tell us about ourselves and other people. But given the frequency with which many of the world’s best companies and most lauded business professionals are embroiled in scandal, you might do well to consider the implications of Ariely’s findings and take actions to prevent the worst from happening at your firm. Here are a few things you might do:
 
Develop and implement control systems in which important "test results" are checked by others with the object of removing the temptation to cheat. This is especially true where cheating could cause considerable damage to people, your organization or the environment.

Promulgate standards of conduct in your organization, and ask all employees to pledge a commitment to abide by the standards.

Incorporate ethical reminders into situations that might tempt employees to be dishonest. One example might be to insert pledges of honest reporting at the beginning, rather than the end, of expense reports.
 

Be vigilant as a leader in fixing your organization’s moral compass-beginning with the example you set. Keep in mind that the first dishonest act is the most important one to prevent. Once individuals cheat and begin to feel comfortable living with themselves, they are more likely to repeat the behavior.

Regardless of what strategies you employ to promote ethical conduct, you may benefit from reading Ariely’s book to get greater insight into the wild and untamed world of human dishonesty.
 
Jim Nortz serves on the board of directors of the Ethics and Compliance Officers Association and is a member of the Rochester Area Business Ethics Foundation. The opinions expressed in this article are his alone and may not reflect those of the ECOA or the RABEF. For more information about the RABEF, go to www.rochesterbusinessethics.com. He can be reached at [email protected].

10/12/12 (c) 2012 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email [email protected].