MIT Sloan Management Review Article on Ethics or Compliance in a Crisis?

Companies stepping up to assist during the COVID-19 pandemic face hard choices in a new risk environment.

Companies are judged by how they act in difficult times, such as the current coronavirus crisis. Making a charitable contribution is a positive action that some companies are in a position to take during a crisis, but such gestures can draw negative scrutiny for the givers. In a high-pressure environment when the chance of losing perspective is high, it’s worth remembering that while times of urgency and crisis call for unusual measures, breaches of compliance and ethical standards can expose an organization to serious risks.

As COVID-19 first swept the globe, Michael, a senior sales representative for a small but growing biotech company in health care, was alarmed to hear about a personal protective equipment (PPE) shortage at the hospital that was his key account. Concerned to hear that staff members were forced to reuse masks and wear flimsy plastic aprons rather than proper PPE, he wrote an email to his company’s medical affairs department to ask for a meeting to discuss ways to help.

About the Author

N. Craig Smith is the INSEAD Chaired Professor of Ethics and Social Responsibility. Piergiorgio Pepe is the president of Quantum Ethics and a lecturer in ethics and compliance at Sciences Po.

Learn more about MIT SMR.