The UK is working on new laws to prosecute senior executives if they ‘fail to prevent’ fraud in their organisations, beyond bribery and tax evasion. Not doing enough to stop money laundering or false accounting could get top bosses actually locked up, replacing board meetings with more solitary and less glamorous alternatives.
Rather than questioning the philosophy behind this change, I want to focus on what we can do about it.
Doing the Right things – for the Wrong Reasons
You might be thinking that the solution is to just turn up the volume on Compliance, making it harder for people to take shortcuts. However, every law has a loophole and the stronger the controls, the more uncomfortable it will be for the rest of the organisation to get on with their jobs.
Most people want to do the right things and they will feel controlled (or slowed down) by what will be seen as an increase in ‘bureaucracy’. Customers might experience an erosion in the quality of service they get, as ‘new regulations’ are put in place. You know this story already...
Could whistleblowing discourage bad behaviours in those who might be tempted to take shortcuts? It might, but you don’t want to feed a culture where mistrust replaces collaboration.
Should we put our efforts in finding the ‘right people’ for those sensitive positions? Evidence shows that unethical behaviours can be developed over time influenced by the context.
So how can we create Cultures where people do the right things for the right reasons?
There is a single, powerful thing you can do in your organisation:
MAKE SURE PROFIT IS NOT THE PURPOSE
profit is key to drive business sustainability, but there must be a strong reason for coming to work beyond profitability
(watch this video)