The moral chaos of the financial services industry is throwing up some interesting cultural findings. Among these is a recent report by corporate governance experts, Labaton Sucharow, showing that a quarter of the financial services executives they polled believed that unethical or illegal conduct might be required for professional success.
Some 26% said that they had observed of had firsthand knowledge of such activity and 30% said that the remuneration structure put pressure on them to break the law or to compromise ethical standards.
Most worrying of all was the finding that 16% said that they would commit a crime if they could be confident they'd get away with it. That finding is particularly interesting in light of the fad for ethics training, suggesting as it does that knowing the difference between right and wrong may not be the problem since some people simply don't care.
The report also focused on a profound theme that has run throughout the financial crisis: many more people know about wrongdoing than are prepared to speak up about it. What silences them is fear of retaliation - from their co-workers. The pressure to conform, not to rock the boat but to stick together, is immense. And this is not unique to financial services. We've seen the same behaviour in the NHS where doctors and nurses stuck together, refusing to blow the whistle when they saw incompetent or cruel behaviour. We've seen the same behaviour among MPs, many of whom knew that expenses claims were out of control. We've seen the same behaviour among large pharmaceutical firms promoting drugs for unapproved treatments.
In all of these instances, the problem is not information that is secret or hidden; it is the fearful silence of the workforce which invariably knows what is going wrong but is afraid to speak up. The hallmark of effective organizations in the future must surely be how easily and how often its employees are prepared to ask awkward questions and how skilled they are at conducting critical conversations.
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