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Professional ethics- Success mantra

August13

Ethics vs ....

In today’s connected world, “countries, governments and companies also have character, and their character is how they do, what they do, how they keep promises, how they make decisions, how things really happen inside, how they connect and collaborate, how they create trust, how they relate to their customers, to the environment and to the communities in which they operate .

In short, how they do is becoming more crucial than what they do.

To a large extent many financial institutions had stopped asking how they were making money, as long as they continued to make more money. How often do we see this manifested in the organizations we worked for and represented? We were so intent on a goal that we lost sight of how we are going to accomplish that goal and the potential destruction we left in the wake of getting there.

This is about the value that developed in the market in recent years. We moved away from the old cliché ‘my word is bond’ to a culture and atmosphere where, I don’t need to think about the underlying right or wrong, suitability or unsuitability. So far there is a market for it.

But the recent economic holocaust seems to have revived the relevance of the old cliché.

The corporate scandals that have rocked Wall Street have shaken the public’s trust in the way companies do business. In midst of these changes, increased connectivity now enables greater access to information that was once private and hidden away from public. The only way for companies to thrive in this new transparent world is to put professional business ethics at the core of how they conduct business, demonstrating that they have nothing to hide.

Just to give an idea of what it means let us look at recent brushes of some leading corporate and its subsequent effects.

Enron – an accounting scandal, leading to destruction of evidence, shredding of important documents whilst keeping shareholders completely in the dark with artificially bloated stock prices and false earnings.

The result: The largest corporate crime of the present era, the company goes bankrupt, thousands lose their savings and the story is still being talked about as an example of what not to do in corporate/business ethics violation.

The Satyam story is already making headlines in the newspaper.

We also have example of Tyco International which became embroiled in a massive scandal in 2002. However it was able to act quickly & rebuilt its corporate reputation. It made a turnaround with specific emphasis on Professional Ethics in 5years.

So let us look at some of the success mantras in Professional ethics:

  • Mentoring and education

In Tycos case, they renewed its focus on “mentoring, teaching and education” of Tyco employees at all levels of the company — especially new hires.

In fact, Companies that want to avoid corruption must develop ongoing programs to train and mentor “high-integrity” employees.

  • Web of accountability

Companies must develop a web of accountability around employees at all levels of management — including the chief executive officer. These systems of checks and balances must include a discipline process to hold people accountable for ethical violations

  • Engaged shareholders

Too many investors simply care about the bottom line, and they don’t pay close attention to issues such as ethics and integrity as long as their stock values are climbing.

This apathy comes with a price. Boards and senior leadership teams that want to protect shareholders must develop and implement sophisticated reviews to evaluate the character of senior management.

Tyco too, after the fallout in the 2002, Tyco established an ombudsman, a senior vice president of corporate governance and an internal auditor who all report directly to committees of the board of directors.

“Those committees had the right to select and remove the people in those three jobs..

Our own Tata is a great example where corporate ethics is written in the form of a rule book adhered to call the famous “TATA code of conduct”. I believe the TATA’s are a respected business family in India for the last 100+ years and their code of conduct is something to cheer for!

Companies – large or small – should conduct themselves in a proper way if they are to succeed and maintain their competitive advantage in today’s hyper competitive world with skills of ‘integrity’, ‘ethics’ and ‘transparency’.

Many corporations are stepping up their efforts to apply these three lessons.

Even individuals must decide before they take any corporate job what their values are?

“I need you to ask yourself one question,” And that question is: What are the principles that you live your life by, that you’re willing to lose your job for? What are those non-negotiables in your life that you would stand for, no matter what?”

The world needs to initiate a fundamental review of its institutions – what a recent gathering of the World Economic Forum’s Global Agenda Councils called a ‘fundamental reboot’. To do this we will need to pass beyond the current ‘long age of forgetting’ – an age in which we have lost sight of the purpose of our core institutions and therefore betray them with blind hypocrisy. That is, we need to return to the ethical roots of society and the economy that is supposed to serve its interests.

This crisis has given an opportunity to rethink if ethics will simply disappear in the battle for survival, or if it will become the foundation on which we build our future.”

“What we now need is not a level playing field, but a loyal playing field,”

“We have thousands of pages of regulations, and countless publications and yet nobody could understand what happened. If you speak of uncertainty, the only solution is trust. And, trust comes from human values” & remember it all eventually comes back to you. More so quickly in todays connected world.

Be the Change You Want to See in the World

posted under FACE OFF.., Professional
One Comment to

“Professional ethics- Success mantra”

  1. On August 13th, 2009 at 4:39 am Randy Nichols Says:

    I found your site on Google and read a few of your other entires. Nice Stuff. I’m looking forward to reading more from you.

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