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Ethics and Project Management by Ralph L. Kliem, PMP

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163
7
Ethics and the Law
Ethics is oen erroneously confused with compliance with the law. In
reality, ethics is much broader than the law. In this chapter, however, the
focus is on compliance with the law.
Ethics and law seem tightly intertwined for obvious reasons. Violation of
laws related to ethics can lead to nes and penalties for organizations and
individuals, can end in debarment, or can cause a public relations disaster.
Ethical situations and transgressions that do not involve the law, more
oen than not, are dealt with in a much quieter way. e legal penalties
for violations are oen substantial and, consequently, demand, immedi-
ate attention.
7.1   THERELATIONSHIPBETWEENLAWANDETHICS
It behooves organizations, and in some instances individuals, to keep the
following guidelines in mind when considering ethics and the law.
First, recognize that compliance includes more than the law—for exam-
ple, adhering to policies, procedures, and methodologies of an organization.
Most organizations circle around compliance with the law, but not always.
For example, compliance with a methodology may not involve compliance
with the law but may require compliance with management direction or a
specic contract with a customer.
Second, recognize that compliance is not passive; it is very active.
Organizations, at all levels, must make a concerted eort to demonstrate
compliance with the law. e absence of an ethical situation or trans-
gression does not mean compliance with the law. More oen than not,
compliance with the law must be demonstrated, meaning exercising
such concepts as due diligence and due care. For example, tests should be
164  •  Ethics and Project Management
administered to ensure compliance with quality standards dictated by the
law; it cannot be assumed that compliance will just happen.
ird, understand that noncompliance requires taking corrective
action. Failure to comply, especially if awareness of its existence occurs
and nothing is done, can result in sti penalties both for the organization
and the individuals involved. For example, it is dangerous to assume that
a serious violation of a law on the project will go away simply by ignoring
it or hoping that no one says anything to be absolved of responsibility.
Fourth, have a good understanding of any applicable laws, but do not act
as an attorney. Project managers manage projects; that is their expertise.
Unless they have a strong legal background or are an attorney, they should
rely on experts to help with questions regarding the law. Oentimes, the
law can be vague and convoluted, and interpreting without the expertise
can have dire consequences for the organization and involved individuals.
For example, export laws can be very complex and the company’s attorney
can help interpret them.
Fih, realize that compliance does not stop unethical behavior; it sim-
ply minimizes the probability of occurrence. Just because a law exists
and an organization embraces the law does not mean people on the team
or the parent organization are obeying it. Compliance requires ongoing
awareness and, in some cases, continuous monitoring. For example, it
makes good sense to have an idea of what laws apply to the project and
to revisit them during the course of the project to determine the degree
of compliance.
Sixth, recognize that noncompliance can result from internal and exter-
nal circumstances. For example, partnerships and other strategic alliances
in which the project may be involved do not necessarily exempt individu-
als or the project from responsibility for compliance; a close working rela-
tionship could lead to legal complications without anyone realizing it.
Seventh, be aware of the ethical laws applicable to the project and have
a good understanding of the content and scope of those laws. When it
comes to compliance, knowledge is the best protection. Again, when
in doubt, contact the experts. For example, large companies especially
have procurement specialists, lawyers, and contract specialists available
for consultation.
Eighth, do not let current conduct and custom be a substitute for com-
pliance with the law. Conduct and custom are good guides, but both may
be tolerating noncompliance. For example, what may be customary in
China or Italy may not be legal according to the home countrys laws.

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