The question was recently asked, “Why are so many great business leaders found guilty of corruption?”
I believe the premise of the question is factually flawed. There are not “so many” corporate officers (a.k.a. leaders) found guilty in a court of law if you look at the statistics – the number convicted is a very small fractional percent of the total who are in those positions. I don’t agree with the modifier of “great”, or better I don’t understand how great is defined and measured. A leader who takes their company to disgrace and ruin is not “great” by any number of different definitions of greatness. “Corruption” is a broad term whose meanings range from immorality and perversion to unintentional alteration of data. I prefer the definition of “corruption” in this context as “using a position of trust for personal gain”; and “guilt” not restricted to a court of law.
So the question might better be “Why do business people put in positions of trust use their authority for dishonest gain?” This expands the scope of leadership beyond corporate officers to anyone with authority given to them by the company they work for. Corruption would then include anyone fudging a timecard or expense report to a decision maker accepting a “gratuity”, to a CEO manipulating a quarterly report data to make the “numbers” for a bonus to kick in.
Corporate culture is the culmination of the habitual behavior of its people. If fudging an expense report is an accepted “wink-wink” habit, and the list of “wink-winks” grows from there, the cumulative effect of these habits as people move up an organization to positions of more authority and trust to committing more serious and egregious dishonesty is easy to see – there is never a big step, just the next step in a long series of steps.
So when we see a corporate officer convicted and we say “How stupid was that” or “What were they thinking” – I think the answer to the question is that this outcome is a result and indicator of a systemic corporate culture of dishonesty. In crime they say follow the money trail – in the instance of corruption, follow the trail of dishonesty up through the company to the top.
And who is really “guilty”? Isn’t it the corporate Board of Directors for allowing a culture of dishonesty to grow and persist? The directors are the stewards and guardians. They have a fiduciary duty of care and a duty of loyalty. “Loyalty” equates to “No self-dealing” and “Care” equates to “Business Judgment”. And if the directors are guilty, who is it that puts them there? – the stockholders. Maybe the old saying that if you point a finger at someone, there are three pointing back at you is true. Maybe the indictment of “corruption” is one of our societal culture as well.
