In our ethics and compliance universe focused on avoiding scandals and prosecutions, we can sometimes forget the greatest value ethics programs can add to a company. James Stengel, the Global Marketing Officer for P&G hasn’t. Stengel oversees the world’s largest advertising budget—$6.7 billion—and had this to say in a recent interview with Geoff Colvin in Fortune:

Geoff Colvin: You are in a great position to evaluate consumer trends. What is the most important thing you are seeing?

James Stengel: The biggest thing going on with consumers is that they want to trust something. They want to be understood, they want to be respected, they want to be listened to. They don’t want to be talked to. It’s trust in the largest sense of the word. People really do care what’s behind the brand, what’s behind the business. They care about the values of a brand and the values of a company. We can never forget that. We can never be complacent about that.

This is an enormous phenomenon, enabled by technology in many ways. Businesses and brands that are breaking records are those that inspire trust and affection and loyalty by being authentic, by not being arrogant, and by being empathetic to those they serve.

He is a marketer, and a good one.

“People . . . care about the values of a company. We can never forget that. We can never be complacent about that.”

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Okay -- you're chairman of the board of a regulated company. You pick up the newspaper one morning and read that your wildly successful CEO has been caught violating a well-established regulation governing your company's business. This is a regulation you know well, because earlier in the year, the regulator sent letters to all of the participants in the industry reminding them about the importance of complying with the regulation. In fact, it is a poorly kept secret that earlier allegations about your company and CEO violating this rule were what prompted the regulator to issue the reminder.

As a result of this newest violation, the regulator has fined the CEO and the company, and has ruled that the company cannot bid on an important upcoming project, and this can have potential implications for your company's competitive position for years to come. As importantly, the scandal is being widely reported on radio and television, and is the topic of considerable coverage in the papers as well. Your company's reputation has taken a huge hit as a result of the actions of your CEO.

What do you do with your CEO? Do you promote him? Tolerate what he's done? Discipline or coach him? Do you fire him?

I'm guessing that most of you would select an option other than promote or tolerate. I'm guessing some of you might even say he should be fired. CEO's of recent vintage have been removed for less. What do you do?

Well, if you're the owner of the New England Patriots, apparently you do nothing.

Your thoughts??

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Last week I had the difficult task of conducting leadership training in Milan and Paris. Forget Springtime in Paris, Autumn is the time of year to visit. Blue skies, temperatures in the low 70s, a crispness in the air . . .but I digress.

In Milan and Paris, and earlier this year in Barcelona and Lisbon, I asked a number of mid to senior level leaders how they would respond if they learned that one of their direct reports was having an affair with one of his/her direct reports.

I’ve asked this question the same way all over the world. Not in private conversations—the leaders needed to give an impromptu answer in front of a group of their colleagues. Do you care to predict how leaders in the aptly named Romance Countries responded?

To hold the suspense a little while longer, let’s review the standard American response. Most Americans say that this situation is unacceptable. Many offer an argument that it could lead to issues of sexual harassment. While few use the magic words “hostile work environment,” there are clear echoes in the answers. Others talk about conflict of interest, and note that when a manager is having an affair with a subordinate it is pretty hard to make objective decisions about that subordinate. Some people even mention both harassment and conflict of interest in one answer, earning bonus brownie points.

In the Romance Countries, the first reaction is mild discomfort at being asked the question—moreso from men than from women. After a few seconds of reflection, men and women alike universally give the same answer: “This is a private matter that is none of my business.”

The “hostile work environment” concept not being firmly entrenched here, (and with harassment the explicit subject of another case) I push forward on the other front. “It is now one month later, and an employee comes to you with a problem. ‘I am no longer getting good work assignments,’ she says, ‘my coworker gets them all, and I think it is because she is having an affair with our manager.’”

We can see the lightbulbs going off. But even then, many leaders resist major interference. “I would counsel the manager to be more careful,” says one. “I would start reviewing all major personnel decisions,” says another.” Yet most leaders at this point realize that the situation is untenable, and adjustments to the reporting assignment must be made.

Of all the subject areas of ethics and compliance, conflicts of interest and relationships between the sexes continue to provoke the most divergent responses worldwide. Years of policies, training and media attention have diminished the divergence—a little. But, not surprisingly, the culture of your country still makes “tout le difference.”

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