A Moral Compass
The failure of ethics in business is front line news. In response, regulatory agencies are drafting more integrity rules and most corporate managers I know are scrambling to comply. Managers are looking to strict compliance with rules and regulations, internal and external audits and insurance to reduce the impacts of integrity risks to their corporate bottom-line. Through work in-the-trenches with companies, it is my experience that compliance is not enough to navigate integrity dilemmas. The big rewards are in moving beyond compliance. Before you hire another auditor to comply with ever increasing rules and regulations, why not think about managing integrity beyond compliance. This book will give you the strategic integrity management tools that not only reduce your bottom-line risk; they contribute to your top-line revenues.
All the business tools in this book have been tested through what I call ‘ground-truthing’ processes, and are shared with you the reader through application to real-life scenarios. This book discusses business drivers for integrity in organizations, and then focuses on helping you with the how of operationalizing business integrity practices. This book will guide you through the practical realities of becoming a Moral Compass within your organization. This book is not about making you feel good about corporate ethics; it is about helping you do something about managing integrity so your organization can achieve greater success.
Like you, I have been learning about the complexity of integrity dilemmas since childhood: To be effective, we need to bring our whole person to the task of being a Moral Compass. As a young girl growing up in a multi-ethnic farming community in southwestern Ontario, I learned early to recognize the invisible threads that bound individuals together within a community. Our family farm was embedded in the heart of the tobacco belt of Canada. Migrant workers flowed into our community in the spring when the tobacco seedlings were planted, and left again at the first frost in the autumn. At times, our community struggled to absorb these migrant workers – from Quebec, eastern Canada, eastern Europe, Africa, the Caribbean and Mexico. These migrants challenged the social status quo, impacted our sense of security, and influenced neighborhood youth. But, we were economically dependent on the contribution of these seasonal workers. Like it or not, our lives were interwoven. Those tobacco farmers who recognized the value of respectful relationships with these migrant workers yielded financial and non-financial rewards – their workers were motivated and reliable, and their family life was not threatened.
I also experienced first hand the complex intersection of corporate investment and society when my parent’s farm was expropriated by Ontario Hydro. I witnessed my parents’ helplessness and experienced my own. Others in the community thought that my parents should be thrilled with the financial stability that a corporate buy-out provided. But, these people didn’t understand. Ontario Hydro had the legal right to force my parents to relocate from a family farm. Although the company’s negotiators were well-intended, they did not truly seem to comprehend the enormity of the personal impacts that came with their cheque and a forced relocation.
Even as a teenager, I understood the power of the written media, writing editorials for a local newspaper and running the high school newspaper. My father, my personal integrity hero, took me aside and spoke to me of the work I was doing: “Leadership is being extended to you. There is an accountability that comes with that leadership. You must learn to think beyond ‘me’ to ‘us’.” A blunt message of responsibility that was to become my mantra.
My journalism career took a bit of a detour and I ended up a lawyer. Law was attractive: it gave me a framework in which to examine business integrity and social justice, and offered me insight into the strengths and the limitations of legislative and judicial authority on integrity dilemmas. By some twist of fate, I was hired to work in the oil patch, in international projects, and ultimately in executive roles. From the start, I was thrown into projects in the developing world – Indonesia, Pakistan, Algeria, Colombia, Papua New Guinea, to name but a few – and I loved it.
On-the-ground experience with energy projects in these countries gave me the unique opportunity to explore the interconnectivity of the corporate investor, the host government and the local citizens. Partners in these commercial projects needed each other. Vietnam had oil reserves, but lacked the funds and technical expertise to develop the reserves; Western companies had the dollars and the know-how. Notwithstanding this co-dependency, both the local and foreign partners preferred to build brick walls around investment projects to constrain interaction between foreigners and locals. Just as I had experienced in my childhood, the local community wanted to shield its citizens from outside influences. My history had taught me that this strategy would not work; I knew it had to be about “us”.
Participating at the corporate table in both head-office boardrooms and at operational field sites forced me to act as a bridge between management principles and operational reality. Understanding opportunities and challenges from both a management and an operational perspective enhanced my ability to identify solutions to perceived dilemmas. This bridging role also fostered the ground-truthing of assumptions and logistics. Head-offices have incredible intellectual capital. But, as I learned, if head-office strategies were not applied to projects in a real and meaningful way, the disconnect between the management vision and operational reality compromised everyone’s objectives and credibility. Lawyers in head-office could edict lofty directives about sexual discrimination, but if the personnel in a field office in Egypt did not know how to apply these standards within Islamic communities, the likelihood of corporate management policies being implemented was predictably slim. And, ground-truthing was not just relevant for companies. When international environmental agencies make claims about environmental degradation by corporate investors in the Amazon, I challenged these organizations to ground-truth their claims through direct observation.
Over time, I earned a reputation as someone who asked the tough questions. When my corporate colleagues were uncomfortable talking about the reality of bribery in Ecuador, or were squeamish discussing conflicts of interest in Saskatchewan, I would find a way to get the issue on the table. From personal experience, I know that the barriers to speaking up on specific internal integrity dilemmas can be formidable. Creating an accepted process for managing integrity dilemmas, in any organization, can diffuse some of this personal risk.
Some people claim that they can compartmentalize their work life, their spiritual life, and their personal life. These same people claim that in a project, they can put government in a box, impacted citizens in a box, and corporate investors in a box. Compartmentalization is a very tempting theory. However, I feel our seemingly watertight compartments have long been flooded. When you work as an employee with a company, or work along a corporate supply chain, you are connected to that company and to its impacts on society. When you make decisions about integrity, inside a boardroom or at your family dinner table, your decisions are influenced by your values as a whole person. In the farming community where I spent my childhood, tobacco growers are now converting their farms to grow ginseng and other crops, or selling out. As part of the tobacco supply chain, farmers feel the negative social stigma; they deal with their own inner conflict about their role in an industry that causes cancer. Public furor over the perceived lack of integrity within tobacco manufacturing companies has a direct impact on the lives of tobacco growers, their families and the local community. There is no rational way for us to put Big Tobacco, cancer victims and tobacco growers into individual boxes.
There is another theory that is thrown out routinely in discussions about corporate integrity. People frequently assert that “doing the right thing” can be defined in black and white terms: “You will know the right thing to do.” Others take a very Pollyanna view of the world, declaring “if only companies would behave more responsibly, environmental degradation would end.” Seeing the world in black and white is quite alluring. It condones the blaming of individuals and organizations for enormous wrongs. But, it is a simplistic view that rarely helps individuals or organizations to define or manage the complex integrity dilemmas that we struggle with in the 21st century. There were many bitter lessons that reinforced these learnings, and the business imperative to manage integrity beyond compliance. Let me share a few of these learning experiences from Indonesia, Colombia and Nigeria.
I cut my corporate teeth in Indonesia. My first perception of Indonesia was as a place of boundless lush jungle. In my first visit to a seismic camp in Kalimantan, this perception was abruptly jarred. We flew over clear-cut islands – not just clear-cut forests, but small islands shorn of trees. With enormous gasps, we stared down in shock at the scarred land. Then the finger-pointing began:
“The Indonesian Government is allowing this to happen. They are getting the profits.”
“No, it is a foreign company that is doing the clear-cutting and making the money.”
“I heard that the locals are taking bribes and letting local companies in to clear-cut.”
By inadvertently seeing the issue of clear-cutting in black and white terms, my colleagues struggled to identify a “culprit” to blame. It is more likely that there was no single organization or individual responsible for this outcome. It is also likely that the clear-cutting occurred incrementally. It is not likely that someone recommended: “let’s go clear cut whole islands”. When we look at integrity dilemmas in black and white terms, we fail to recognize the complexity of the issues, or to recognize the imperative for multi-party alignment in the solutions. The good, like the bad, doesn’t happen with one visionary sword carrier, it comes when a whole group of engaged individuals and organizations begin to agree to do something differently.
In the late 1980s and early 1990s, many companies invested in Colombia. The country was largely stable. Over the course of the 1990s, security and governance in Colombia was incrementally undermined by drug lords and guerrillas. Like most investors, the head-office management team that I worked with observed the growing erosion of stability in Colombia with unease. The tipping point came the day that a convoy of 40 trucks carrying oilfield equipment for our project was torched by guerrillas, from end to end. Thankfully, no one was injured, but the enormity of our problem crystallized in the space of about two hours. As champion of an above-ground risking process in the company, I was sent to Colombia to lead an investigation into what happened, and to assess options. I knew that an exit from the country was a preferred option. Withdrawing from Colombia would however have had enormous negative impacts for the Colombian Government, and for company personnel and contractors. Through very tense dialogue, we were lucky to identify an option that was palatable for everyone: we asked the Colombian Government for permission to transfer our drilling commitments from a guerrilla-infested region of the country to safer ground. We had reacted, and it worked. Jobs were preserved and the company maintained its credibility and its commercial opportunity. This response was only possible because the company had a strategy in place for managing integrity dilemmas.
Sometimes, our most powerful learnings are drawn from our greatest integrity challenges. In the mid 1990s, I was a Vice President with an international oil company. A corporate decision to invest in Nigeria necessitated that the company re-evaluate its boundaries, and re-assess its accountabilities. I’ll forever be grateful to my corporate colleagues for their courage in allowing those conversations. At the time of the company’s commitment to drill for oil in Nigeria, Canada’s Foreign Affairs Minister was leading the charge to have Nigeria thrown out of the Commonwealth. Transparency International ranked Nigeria at the VERY bottom of the corruption index. I remember vividly the day that a colleague walked into my office to inform me of this corporate decision to do business in Nigeria. I gasped. Weren’t we aware that Nigeria was a pariah state; that corruption was pervasive; that Abacha was an evil dictator; that Shell’s experiences were horrific; that local communities were bearing the full weight of investment (oil spills, contaminated water, gas flares) yet received little or no allocation of the benefits of development; or that the recent death of Ken Sira-Wiwa was a defining moment in relationships between investors and host communities (and that his brother was residing in Canada)? The litany of questions was unstoppable. I was incredulous.
But, the decision was made. How then to live with this decision, and not compromise the corporation, our personnel, and our stakeholders, in the process? It could easily have turned into a public relations nightmare. Through persistent and credible dialogue, we kept repeating the mantra that we wanted to be part of the solution in Nigeria, not part of the problem. Slowly, we built trust. I traveled to Nigeria, many times, to meet with citizens, local advocacy organizations, other investors, and local governments. I met with the local representative of Transparency International in his offices above a chicken coop in a remote district of Lagos. We asked questions. We listened. We heard their stories, perceptions, goals, fears. We saw their mandate to change Nigeria – Vision 2020 – and became familiar with the steps in their journey. We then reflected on what we could do. How could we really be part of the solution in Nigeria? I endorsed two strategies: the company should be a bold advocate for gas flaring reduction or elimination; and the company should deal with corruption head on through alliances with others.
With these mandates, we marched forward, organizing a gas flaring conference in Abuja and many steps later bringing an international group together in Kananaskis, Canada to talk about how to reduce gas flaring in Nigeria. At that conference, we first heard the news that Sani Abacha had died in the arms of two prostitutes. Under the new leadership of President Obasanjo, companies with a recognized ability to mange integrity issues, including gas flaring and corruption, have been high-graded as investors.
Some people have asked me along this journey: “Why did you become a moral compass for corporations? Why didn’t you instead align with an advocacy organization or a government to promote integrity in companies?” The questions are fair. In fact, over the last few years, much of my work has been focused on bridging relationships between corporations and governments; corporations and advocacy organizations; corporations and host communities. Keeping my focus on corporate integrity is very deliberate. Since the early 1990s, corporations have funded and managed a majority of the world’s development projects. Corporations’ ability to influence citizens and communities is now greater than that of governments. When you are in a position to impact others, you have a choice; you can either demonstrate responsive leadership, or you can fail to be a leader. Governments, advocacy organizations and other corporate stakeholders should not be expected to stand by idly when corporate leaders fail to assume leadership on integrity.
In 2000, I was diagnosed with a tropical virus contracted in Vietnam, and spent 8 months recovering. As my body slowly rejuvenated, I discovered I was no longer content to work with companies to punch through the ceiling on corporate integrity; I also wanted to raise the corporate integrity floor. Alliances with other individuals sharing similar objectives were critical. To gain a better understanding of how companies could be motivated to contribute to human development within host communities, either independently or in partnership with humanitarian organizations, I participated in several missions to Vietnam and Yemen. Ultimately, I founded Bridges Social Development as a not-for-profit vehicle to foster these alliances (www.canadabridges.com). I came to realize that the tools and practices that I had been applying in for-profit corporations were equally relevant to non-profit organizations. You will discover that the simple, practical tools in this book can be used to help any organization, community, business, or family live in integrity.
Until relatively recently, proponents of corporate social responsibility have been somewhat skeptically received by leaders in the public, private and voluntary sectors. Through my work with companies, and key corporate stakeholders, it was becoming glaringly obvious that many external stakeholders were dismissing corporate responsibility as “fluffy” public relations rhetoric. Even within corporations, there was a great deal of confusion, even disillusionment, as compliance with rules became equated with corporate integrity.
I believed that it was time for a book on business integrity management practices that would help those willing to overcome their apathy. I consulted with Bob Schulz. Bob has been a teacher of management practices for three decades. His students have thanked Bob by honoring him with countless teaching awards. Bob has recognized, and nourished, the deep hunger in young people to rationalize the need to find a kinder way to treat the world while earning a good living. Bob believed that the corporate community was ready for this message. I invited him to become my coauthor.
As we worked through this book, the question we kept asking ourselves was – “When organizations manage everything else so well, why do they fail to strategically manage integrity?” All too often, company managers attempt to put integrity in a box, usually an unwieldy box labeled “ethics”.
Here are the business tools you need to take corporate integrity out of its box and become a Moral Compass capable of directing your own organization to integrity and greater upside potential.
