What you permit you promote

Like most business professionals I spend my time working with decent people who are well intentioned, honourable and care about the world.

Unfortunately, these good people, trying to do good things often appear to outsiders to be part of a ruthless and amoral world where anything will be done in the name of profit. How can we resolve this apparent contradiction? The paradox of values-led people appearing to lack them comes to the fore during the depressingly regular stream of corporate scandals that fill our papers. Whether it be emissions scandals in the motor industry, worker treatment in clothing or money laundering in financial services I am sure that within all of those organisations the vast majority of people were as shocked by events as outsiders were.

It’s easy to oversimplify these scandals. Either by portraying them as deliberate strategies employed by unethical leadership or by scapegoating “rogue” middle managers. The truth is more complex. In a former role, I was once lucky enough to spend time listening in at a customer service call desk and heard first-hand what may be one of the explanations. A customer was calling to complain about being overcharged. The issue was soon resolved, as it appeared that their discount as a key worker had expired given that they had to prove their status once a year. When the call was over, I asked the customer service operator why they didn’t just remind clients to reconfirm status once a year and she replied, “I guess our senior managers hope they don’t notice”. I asked if she had ever told them this was happening, to which she said that she assumed they must know, so it wasn’t worth the bother. As an outside consultant, I was able to take a risk and asked the question. It became clear that this wasn’t deliberate, and a better policy was soon put in place.

But how did this happen in the first place? Well, I’m sure that somewhere along the line there was an incentive to let customers pay too much. Middle managers were measured on revenue, so proactively instigating something which would cost money was always unlikely. Junior people assumed that those above either actively wanted to take advantage of customers or didn’t want to know what is really going on so that they can have plausible deniability. For some leaders that may have been true, but not all, and hopefully not even the majority. Most want to lead an open, honest and ethical business. A profitable one of course, but still an ethical one. Why was it so hard to do so?

In 2020, research conducted by The Yale Center for Emotional Intelligence, in collaboration with the Faas Foundation, found that of 14,500 U.S. employees surveyed, nearly 1 in 4 people (23%) felt pressured to do things at work that they knew was wrong. With 80% agreeing that they felt they weren’t able to voice their views against such behaviour. The problem is clearly a large one and while we are less tolerant of bad corporate behaviour than ever before, it doesn’t seem to be going away quickly enough.

As with many changes in organizations the behaviour of leaders is key and two things in particular are pivotal: what they know about and what they do about what they know. First, let’s consider what they know. If their knowledge of what is really happening on the front line only comes through the chain of command or corporate reports, it always runs the risk of being filtered, either intentionally or not. Leaders must find some way of seeing for themselves what actually happens. They could do as I did and listen in on calls, or more simply just spending time in conversation with staff and customers, the more informal the better.

Secondly, how do they act? I learned once the importance of not walking past something which is wrong. I used to coach a COO who lived by the mantra, “What you permit, you promote”. He explained that he learned if he walked past a blocked door, he was promoting poor fire safety, if he walked past a dirty product display, he was promoting poor hygiene and if he walked past a mis-priced product he was promoting cheating customers, so he never just walked past. In our busy lives this can be hard, because first and foremost it requires you to stop, maybe change direction and take a new path to explore why the thing you have noticed is wrong and then see remediation through to completion. You won’t solve every issue, but others will note your response to the ones you see and hopefully realise that this is the correct response.

So, the cartoon corporate villains we read about in the media are not what they seem. Poor behaviour is rarely the result of a single person’s agenda but rather an unintended failure in communication and collaboration between everyone involved. Recognising this is important. Unless we understand how and why poor business practices evolve, we can’t prevent them from happening in the future. But this does not mean that leaders can shirk accountability. On the contrary, it shows just how important those hard to measure leadership skills are. The ability to articulate a social purpose beyond profit, to shape culture, to listen and most importantly to not walk past the small infractions. These are the skills which can help prevent the next corporate scandal.