The Moral Business
July 18, 2012
In “Cat on a Hot Tin Roof”, Big Daddy bellows in exasperation, “Ain’t nothing more powerful than the odour of mendacity.” Recently diagnosed with cancer and fed up with the secrets and lies of family life, he begins to see that there is nothing lost in airing the truth. Perhaps many of us when faced with the finality of a situation in life realise that there was much left unsaid that, had it been expressed, would have been to everyone’s benefit. Had we acknowledged our trepidation and named the elephants in our various rooms, standing up for integrity and truth, we might have cleared the air of the stench of mistrust and enjoyed a much more honest life. In fact, in a recent article, the number one regret of the dying was identified as: ”I wish I’d had the courage to live a life true to myself, not the life others expected of me.”
In light of the many recent revelations of systemic corporate greed and mendacity, I have wavered between despondency, fury and hope. Should I give in and hone my deceptiveness skills: both to myself and others? Should I play the game just because others will be disappointed if I don’t or, at the risk of incurring their wrath, express my misgivings, doubts or hesitation? Should I just give up hope that we will find people worthy of the title “leader”? Should I join those manning the barricades of the Occupy movements? Alternatively, should I remain hopeful that those who fiddle while Rome burns will soon be swept aside in a tide of genuine democracy and that our organisations, businesses, communities will be driven by the people within them rather than some out-of-touch elite? Should I rejoice that, at last, some of those in positions of power are naming corporate greed as systemic and not simply driven by “a few bad apples”. Are people finally getting it? It is a human dilemma: conform or be crushed by a corrupt system.
Furthermore, as Fintan O’Toole suggests, “All the evidence from the many scandals of recent years is that it is not sociopaths who create rotten cultures. It is closed, arrogant, unaccountable cultures that turn ordinary people into sociopaths.” Deming said as much some years ago.
So many times over recent weeks as I read of the fraudulent practices of GlaxoSmithKline, the UK Conservative Party, the New Zealand Immigration Service, Barclays Bank and most recently, HSBC, have I found myself remembering Deming’s comment that 95% of possibilities for improvement sit with the system and only 5% lie with the individual. I also hear myself muttering that a bad system will defeat a good person, every time. EVERY TIME. We are seeing this before our eyes.
I received a subscription email that propounded the notion that we thrive when our ratio of positivity to negativity is high. I have no beef with that notion. However, it went on to link to articles in the press that “demonstrated” how things are looking up and we are back on the road to recovery and everything is alright, if we would only stop feeling negative about things. Made me want to vomit. There is a word for folks like this: Pollyanna. I know people like this, some of them apparently working in the real world of organisational life with a view that if we only just thought lovely things, it would all be OK. The truth is: the world, including the business world, is in a parlous state. No amount of positive thinking can erase the fact that some of the world’s major industries and corporations are systemically sick. No amount of soma will make me blind to the fact that those in positions of power remain inert in the face of corporate malpractice, environmental degradation and growing inequality. No amount of media distraction will divert me from the evidence that our democratically elected “leaders” are in the pay of lobbyists and their corporations who answer to nobody, bar their shareholders. I’m not just having a moan and I’m no Eeyore; I have a good life and count myself exceedingly fortunate that my worries are mostly first world problems. Think you have worries? Enter your annual salary in the global rich list website and see where you place relative to others in the world. If you are reading this, life is probably pretty good for you, on the whole.
However, we are an important juncture in human history. Our institutions have lost the trust of those they purport to serve. Many of our businesses are resorting to gamifying their marketing in an effort to soma-tise potential customers. Many of our workplaces are likewise trying to hypnotise people that their meaningless work is fun fun fun.
I take heart that there are businesses like Morning Star, who base their organisational effectiveness on self-management and not some lumpy hierarchical management structure that insists “it knows best”. I take heart that the Beta Codex Network, of which I’m an associate, is out there, promoting a saner and more humane (and frankly, much more sensible) way of structuring organisations by advocating for radical transformation, rather than tinkering round the edges, to achieve real effectiveness, meaning and joy at work.
I am entirely sure I am not alone in my disdain towards fraudulent business practice. The aptly named Bob Diamond, ex-CEO of Barclays Bank infamously told British Members of Parliament last year, “There was a period of remorse and apology for banks and I think that period needs to be over.” However, as Andrew Rawnsley has written recently, “he was wrong: plenty more remorse and apology would be appropriate, and welcome; but much more importantly, the values, culture and practices of finance, as they have developed since the ‘Big Bang’ reforms of 1986, must be torn down, and a smaller, humbler, simpler world of banking built in their place.”
To be honest, I’m not interested simply in apology and remorse. These things are worthless without some kind of follow up. If someone apologises, I expect an associated change in behaviour and attitude that demonstrates the apology was genuine, heartfelt and indicative of real responsibility-taking. I’m mostly interested in what Rawnsley suggests with regards a tearing down of the values, culture and practice of finance. I’m similarly interested in a transformation of business. I’m interested in businesses selling products and services that are actually worthwhile. I’m interested in businesses that actually provide interesting and meaningful work for people. I’m interested in businesses that run on the premise that people are humans, NOT resources. I’m mostly interested in business that operates with transparency, honesty and humility. Not just a PR job that makes us think these are the values, but that these are the values that are REALLY lived throughout the business; even, if not especially, by those who manage it. Even Bob Diamond, in a BBC lecture last year, said, ”Culture is difficult to define. But for me the evidence of culture is how people behave when no one is watching.” Couldn’t have put it better myself.
Business leaders are not going to changes things simply because they come under fire in the media or are told that it is wrong. They already knew it was wrong and they did it anyway. The structures of how business is managed create the sick cultures in which they operate. Cultures are not transformed by mere criticism nor by symbolic public witch-hunting.
It is clear to me that the fraudulent practices that have recently come to light are systemic. The “few bad apples” defence, as Andrew Rawnsley has written, will not wash. What happened, happened because the system allowed it, condoned it. Those who make the rules not only fell under the thrall of high finance, they were well and truly in its pockets. As he goes on to say, a college student, with no previous convictions, was imprisoned for six months for stealing a £3.50 pack of bottled water during last year’s London riots. Yet there is serious doubt whether it will be possible to prosecute banksters who perpetrated a massive con involving sums which would buy many millions of bottles of water.
Just as “a few bad apples” does not placate those who watch these scandals with disgust, the opposite also does not give comfort. The suggestion that there are individually decent and compassionate people within these rotten systems and that this should give us hope things will change, is just as false. The system is responsible for 95% of what goes on in it. The system must be reformed, transformed, root and branch. Utterly. Totally. Absolutely. It is the system.
Surprised at these revelations of corporate fraud? Not much. The systems which brought the financial crisis and scandalous corporate behaviour to bear have not changed. The same dynamics are in place, the same values intact, the same practices perpetuate. The question that Plato posed in his tale of the Ring of Gyges was whether a moral person would remain moral should they become invisible. To all intents and purposes, the practices of bankers and the nod-and-wink agreements made over lobbyists’ drinkies are invisible and mysterious to most of us. Let loose to do as they please in the 1980′s, what would constrain banksters to behave in a moral fashion? Reliant on corporate donations, what would cause politicians to change the immoral rules which their paymasters rely on?
Public enquiries, the odd sacking, stripping a Fred Goodwin of a public honour or the symbolic prosecution of a Bernard Madoff, while just, are simply public relations band aid solutions to deep seated problems. If the system remains intact, people will continue to act within its rules, treacherous though they may be. Having said that, those who stewarded those rotten cultures must be removed to make way for those who have the nerve to re-boot their systems and establish morality within business and government. Rotten cultures, as Will Hutton has observed, do not emerge from thin air. They emerge from structures which encourage and condone rotten behaviour. Similarly, moral cultures will also not arise out of thin air.
To be truthful, I’m not depressed by recent revelations of this institutionalised fraud and business improprieties. To me, they are the lancing of the boil that needed to happen. It is a wake-up call to actually look at the system and craft new ones for the 21st century. Vince Cable, UK Business Secretary, pointed to the Swedish business bank, Svenska Handelsbanken as a model of how things could be. Like Cable, I am a long-term optimist and a believe that these scandals will eventually lead to better systems.
Trying to apportion responsibility for these scandals on a few rogues ignores the reality that the systems within which these folks operated are broken. News International, Barclays Bank, GlaxoSmithKline, the New Zealand Immigration Service, HSBC. The politicians of all hues whom we elect to represent and stand up for our interests are overly chummy with the financiers, the corporates and the media who are being tagged with the epithets ‘immoral’ and ‘deceitful’. Are we really all in this financial crisis together? I think not.
My hope is that all these dishonest practices will eventually herald the time of the moral business. It is time for the way we do business to be re-booted. It is time to start doing the right things, not the wrong things righter.
What is the moral business?
A moral business orientates itself to its customers, its staff, its environment, its community and its shareholders, not just its shareholders. A moral business orientates itself to doing good, not just for those at the top whose enormous bonuses ensure their collusion with a system that is focussed more on quick profit than innovation-generating benefit for the wider economy. A moral business takes hold of the bigger picture and takes a long-term view of what business success means. In other words, it will see that deifying shareholder return is not how to run an organisation that serves all of its stakeholders, nor contributes to sustainable human development.
I don’t believe that anyone seriously gets into business to do wrong or sets out to be intentionally deceitful or immoral; I have a higher view of humanity. But when we find ourselves in sick systems, we struggle to swim against their tide. If we want our businesses to do the right thing, maybe it’s time we put our foot down and started naming some of those elephants. Let’s also look out for those leaders who have the courage of their convictions to do the ‘hard thing’ and reform capitalism.
Mendacious times, indeed.