The CFA Institute (Certified Financial Analysts) has a saying, \(P=f(x)\). For you nonmathematicians out there, the translation is that the probability of an ethical outcome is a direct function of the amount of money involved. The more money involved, the less likely an ethical outcome. So, the slope of the line is negative.

There is the hubris, the pedestal effect, the inability to accept a setback, and the failure to understand that we all hit a wall once in a while. Sometimes we have to take a loss. Sometimes we need to step off the pedestal. When managers at high-performing companies succumb to these pressures, they do go ethically nuts.

An article in the Academy of Management Journal presents research that highperforming companies are more likely to break the law. \({ }^{22}\) Professor Yuri Mishina from Michigan State and his coauthor colleagues, Professors Dykes, Block, and Pollock, in "Why 'Good' Firms Do Bad Things: The Effects of High Aspirations, High Expectations, and Prominence on the Incidence of Corporate Illegality," conclude that there is something about being on an earnings roll that clouds judgment. In addition to the cyclone of hubris, managers are trying to grapple with the pressures of sunk-cost avoidance, investor relations, and the sandbox mentality of just "making those numbers," even when they are not real.

But again, business managers face pressures similar to those we encounter in our personal lives. A friend rented a truck to help his aunt move from the large home she had enjoyed with her recently deceased husband of many years, to a more easily managed apartment. He did not take the insurance coverage for the truck because, as he said, "I know how to drive!" Safety tip for renting moving trucks: Your auto insurance probably doesn't cover you! And the coverage the truck rental business charge is expensive! The large truck proved to be a challenge, and my friend scraped the back top of the truck on some eaves as he turned a corner rather inartfully. There were two thoughts that came to his mind: (1) That's gonna be expensive and (2) Should I try and hide this from the rental guy? Oh, that second thought! There is that little part in all of us that doesn't want to ante up, and another little part that believes we can actually dupe the other guy so that we need not pay for something that really is our responsibility. But my friend drove into the U-Haul rental center and pointed out the hole, the scratch, and the damage in all of its uninsured glory. The initial response from the rental guy was, "Wow! That's bad!" Then he paused and said, "I'm not going to worry about it."

My friend wonders how different the ending might have been had he not 'fessed up. How different this generous soul of a rental manager might have been had he discovered the damage if my friend skedaddled or skulked out of there. There is that simple but powerful and decisive model from Unit I: "If I were the U-Haul manager, how would I feel if someone tried to hide damage from me?" The fog and pressures that interfere with good ethical decisions can be managed with the simple recall of those questions.......................

Discussion Questions 1. Think of an example of a situation in which you resisted pressure to act unethically.
2. Refer to the Goldman case in Case 2.10 and make a list of the pressures Tourre felt.
3. How could your credo help in resisting pressure?