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12/5/2007 – SAN FRANCISCO - Despite the Sarbanes-Oxley Act of 2002, the ethical condition of corporate America is ominous. Throughout the business world unethical behavior has returned to pre-Enron rates, according to the Ethics Resource Center’s 2007 National Business Ethics Survey (NBES). The NBES shows that the Sarbanes-Oxley Act has been ineffective at achieving its goals for raising employees’ awareness about ethical issues or decreasing the frequency of ethical violations in organizations.

Employees, according to Patricia Harned, Ph.D., president of the ERC, “are fearful about retaliation and skeptical that their reporting will make a difference.” In fact the NBES showed, “one in eight employees experience some form of retaliation for reporting misconduct.”

Nearly 2,000 public and private sector employees, from organizations of various sizes, responded. The NBES results indicate that significant numbers of employees witness ethical misconduct at work – and very few report violations. Among the issues employees reported witnessing most frequently are conflicts of interest, abusive behavior and deception.

The NBES notes that compliance-focused programs have been insufficient in reducing ethical misconduct or increasing employees’ willingness to report violations. Organizations able to reduce incidents of misconduct were those adopted and enforced a workplace culture committed to ethical actions and business practices at all levels of the organization.

The 2007 NBES warns organizations that ethical misconduct remains pervasive and the most effective way to prevent misconduct within an organization is by creating an ethical culture that practices its principles.