Beyond Compliance: Building an Ethical Culture in our New Market

Part 1: An overview of ethical decision-making

When I tell someone I teach business ethics, I inevitably get one of the jokes that likely springs to mind as you read those words; often, it’ll be some version of “Isn’t that an oxymoron?” or “Must be a short course…”. Lately, when I’ve told friends or colleagues that I’m really interested in Missouri’s new medical marijuana market, it’s without fail that I receive a different, but consistent, kind of reply. This one usually highlights one of the various scandals that have characterized the early days of our program. As much as I’m usually able to see humor in dark places, both of these responses bother me, because they say quite a bit about how we collectively feel about these subjects.

It’s to that end that I’m writing this piece and a couple of others over the coming months. As leaders in this industry, you have a responsibility to evaluate your decisions through an ethical lens and to make your primary focus patient safety and access. It’s a pretty sacred responsibility when you back up and take a look at it; you have people’s lives and quality of life in your hands. 

For anyone who hasn’t had much exposure to the topic of business ethics, my hope is that this series might give you some additional context for decision-making in your operational environment, while also providing you with some practical ethical decision-making tools. In this first piece, I’ll highlight a set of steps that you can use as you encounter ethical dilemmas as a leader in Missouri’s medical marijuana industry. Moving into future articles, I’ll discuss issues of social equity (in particular, what we can do to overcome the lack of strong social equity provisions in our existing regulatory framework) and provide some guidance on going beyond compliance by creating an ethical organizational culture. 

So, step into my classroom for a second and let’s take a look at these two subjects (business ethics and the Missouri medical marijuana market) and where they intersect.

Business ethics

One of the most well-known voices in the world of business ethics is Edward Freeman, who explains business ethics and our misconceptions about it in a concise and accessible way in a TEDx talk. I’ll provide my best summary here, but if this topic interests you (I hope it does), you can find the full talk here.

Freeman is on the receiving end of the same kind of jokes I related at the top of this piece, saying that these stem, in part, from a fundamental misunderstanding of the two words comprising business ethics:

  1. Business – We promote a false narrative that businesses exist to make money. That is not true. Businesses exist to create value. They need money to exist. Although our body needs red blood cells to survive, we wouldn’t say the purpose of life is to manufacture red blood cells. You’ve entered the cannabis space for a purpose and although you’ll [hopefully] make money doing it, you likely entered this space because you have a desire to help patients improve their quality of life. 
  2. Ethics – We often talk about ethics as if it is an abstract topic, but we are making ethical decisions all day long, every day. It’s a very practical and applied subject, one that is and should be at the very center of all of our business decisions. When we talk about ethics, people default to thinking that someone did something “bad” or “wrong” and although that can be the case, ethical issues often exist when we build a product or service that does exactly what we designed it to do. These issues often arise from shortsightedness and ignorance, not malice.  

When we talk about business ethics in the Missouri medical marijuana industry, we’re interested in how we (as individuals and organizations) are creating value for Missouri patients. That focus on value and the “how” of its creation is key to an expansive, stakeholder-focused model of corporate social responsibility. This more expansive view is critical to success in a world where consumers are increasingly interested in how companies are behaving. What is great about this, though, is it creates a situation where the right thing to do is often the most profitable. We don’t have to look far for examples of costly ethical blunders in the world of business, but I hope that we’ll have to look further than our own state for those as we move forward. 


An ethical decision-making framework

Often, we make ethical blunders because we fail to recognize the ethical dimensions of a decision. We may have encountered an ethical dilemma and be unaware of it. Any time that we encounter a situation where our alternatives put our values into conflict, we have encountered an ethical dilemma. 


Most of the business decisions that we make have some kind of ethical component to them and so utilizing a framework for thinking through our decisions can increase the likelihood that we’re satisfied with the outcome. These frameworks also help us highlight our metacognitive processes, as we’re not always aware of the historical ethical standards that are influencing our thinking. There are a number of ethical decision-making frameworks available, but one that can help us consider multiple ethical perspectives is provided by the Markkula Center. Consider this framework the next time you’re not sure of the “right” thing to do.

  1. Recognize an ethical issue
    • Could the result of your decision be damaging to someone or to some group? How will patients, employees, and other stakeholders be affected?  
    • Is the issue about more than what is legal or most efficient? If so, how? Given the age of our program, we should expect to encounter ethical dilemmas in those areas where the regulatory framework has not established clear standards for action. 
  2. Get the facts
    • What are the relevant facts of the case? What facts are not known? Do you know enough to make a decision? If not, can you learn more about the situation?
    • Who are the individuals and groups that have a stake in the outcome? Are any concerns more important than others? Are there any systemic characteristics that require we give more weight to the concerns of a given individual or group? 
    • What are our options? Have all of the relevant persons and groups been consulted? Are we exercising creativity in thinking about those options?
  3. Evaluate alternative actions – Each of the following questions explores the actions through the lens of a distinct ethical approach. If you are interested in learning more about the ethical approaches, you can explore an expanded version of this framework here
    • Utilitarian approach: Which option will produce the most good and do the least harm? 
    • Rights-based approach: Which option best respects the rights of all who have a stake? 
    • Justice approach: Which option treats people equally or proportionally?
    • Common good approach: Which option best serves the community as a whole, not just some members?
    • Virtue approach: Which option leads me to act as the sort of person I want to be?
  4. Make a decision and test it
    • Considering each of the approaches, which option best addresses the situation?
    • If this decision was the subject of a cover story in Greenway, how would you feel about it? If you had to tell your parents about the decision, how would that feel? 
  5. Act and reflect on the outcome
    • How can your decision be implemented with the greatest care and attention to the concerns of all stakeholders? How have patient needs been served by your decision? How does your decision affect employees? Management? Financial stakeholders? 
    • Once sufficient time has passed, consider the outcome of your decision. What have you learned?

As an example, let’s say you’re responsible for making purchasing decisions for a concentrate manufacturing company. This requires you to balance issues of patient access, quality, cost, and the organizational goals of profit and sustainability. From my reading of our current regulations (please take nothing in this hypothetical scenario as legal guidance), nothing in our state prevents you from purchasing and using vaporizer cartridges that contain heavy metals such as lead. As there’s typically a significant price difference between higher quality, heavy-metal free cartridges and those that contain heavy metals, there is a market incentive to go with options that have questionable safety profiles. If we were to rely solely on the regulatory framework currently in place and consider profitability alone (prioritizing organizational stakeholders like financial investors), in this situation we end up making a decision that is not in the best interest of patients. 

If we step back and look at this example through the lens of the above questions, we can quickly see how it helps us to take a more expansive view and may lead us to a different decision. In fact, we don’t make it beyond the first step before being asked to consider whether or not the action could harm some group. We’d also note that the issue takes us beyond the scope of legality and so see that we’re in the midst of an ethical decision. In the next step of the process, we’d begin to gather facts, which might start with a review of the publicly available scientific literature and an exploration of regulations in other states. Doing that, we’d see that states like California have specified limits for heavy metals like lead and might note from manufacturer-provided lab testing widely varied levels of heavy metal content in their containers. As we evaluate our alternative actions, we might determine that it is in our company’s best interest to have a policy that reflects a state standard like California’s, which (as we turn to to testing the decision) is the kind of decision we’d be happy to have featured in a publication like Greenway or to talk to our mom about over Thanksgiving (if you’re wondering, yes, my poor mother does have to listen to my rants about heavy metals in vaporizer cartridges – sorry, mom). Over the years that follow the decision, we’d be able to continue to reflect on it as new scientific information becomes available and our company might serve as a model that others attempt to emulate. 

As you can see from this example, the decision-making framework can help us to distill muddier and complex issues down to their component parts, increasing the likelihood that we make decisions that are in our individual, organizational, and societal interests. In our professional lives, this decision-making can be greatly assisted by codifying our organizational values and ethics into statements. In a future article in this series, I’ll explore the role of ethical leadership, codes of ethics, and other policies in creating ethical organizational cultures. I know that it’s wishful thinking to expect that I’ll ever be able to tell people I teach business ethics without them cracking wise back to me, but I strongly believe that we can build a culture in this industry that serves as a model for other medical markets — one that makes us all proud to be involved in ours.

We can and we must go beyond compliance, building a culture of ethical excellence in our state. We owe it to Missouri’s patients.