The Wall Street Journal reported Mark Hurd, Hewlett Packard CEO, resigned for improper conduct with a female contractor. The company was quick to explain that he didn’t violate the company’s policy regarding sexual-harassment but rather submitted inaccurate expense reports that were intended to conceal what the company said was a “close personal relationship” with the contractor. There were cries for review of the policies and procedures to see if future such incidents can be prevented. It is as though people really believed that the policies themselves, if framed well enough, could prevent errors in judgment.
The problem is not that such policies and procedures are absent from the executive’s mind at the time. This executive clearly tried to protect himself from appearance of violation of the policies with misreporting. The problem is not one of forgetting the policies or not having made them tight enough to avoid loopholes. The policies were forefront in his mind. The real challenge is to have the executive hold enough in his or her mind to consider the impacts on the world around them and therefore temper one’s choices. Hurd was only thinking about himself. As long as any of us has only the implications for ourselves as the primary standard, there will be “gaming the system”—no matter the rigor of the policy. There will never be enough refinement in wording to protect him from himself and his bad choices, much less the fallout to the business, the families involved and the workers who trusted them as leaders. So, how can a company protect against such behavior?
The better question is, “how can an executive be developed to better manage their own behavior?” It is a matter not only of conscience but consciousness. By consciousness I mean, how many levels of affected systems and the ripple effects pop to mind when making choices. What are we conscious of? In our culture consciousness is not something we develop as a part of growing up or building values. We may have attended religious services and engaged in religious practice; even learned what the Bible or Koran says. But even then, the papers are filled with downfallen ministers and religious leaders. The “word,” whether in the scripture or the policy manual, will never met the challenge.
Responsibility in The Responsible Corporation® has moved deeply into developing consciousness as part of its practice. It is not a gratuitous act for the good of the employees—although it is an act of responsibility. It also offers an important capability necessary to run a successful business and create an enduring culture of responsibility. Consciousness is a capability that must be developed rather than a rule of behavior that comes with our mental wiring and we gain as children. Or can be instilled by policy.
A suggested alternative or at least addition to policy:
Businesses that spend time in development of human thinking capacity routinely, along with self and team reflection on the systemic effect of actions—toward consumers, suppliers and workers, the Earth and communities, and investors (including beyond just returns) have a better chance of opening up executives and everyone in the company to self-managed and self-correcting behavior.
DuPont Corporation, under Chad Holliday’s leadership, developed a culture of reflection on systemic effects beyond the company itself—a quintuple bottom line (customers, co-creators, the Earth, communities and investors). It certainly did not achieve the status of “beyond reproach” during his ten years, but it imbedded a way of working that educated people routinely, as a part of work practice, on consciousness and the importance of spending time reflecting in meetings and every day functional work. Chad sought to build responsibility as an intrinsic motivation capability, rather than the carrot and stick of the policy world. Chad grew a group of leaders who are now engaging in attempting to imbed such practice.
This is very rare in corporate America, but a capability needed to create The Responsible Corporation®, such that it permeates all aspects of the company and all its tentacles out into the world.