Let’s be clear about something. Corruption is not confined to the public sector.
It is alive and well in the private sector too, as evidenced by recent revelations. And more revelations will follow…
First it was KPMG, McKinsey, SAP and Multichoice. Then Steinhoff’s CEO, Markus Jooste, announced that he had made some bad mistakes and resigned, causing the company’s share price to implode, wiping billions from investment portfolios of pension funds and the like.
Wiping out billions of a company’s value could be termed a disaster in most people’s book. And disasters are known for the fact that they are never caused by one isolated incident or event alone. Investigations into a wide variety of disasters ranging from the Titanic’s sinking in 1912 to the Space Shuttle Challenger’s disastrous disintegration shortly after launch in 1986 (not to mention the Space Shuttle Columbia which disintegrated in 2003), have revealed that many warning signs which led up to each disaster were for some or other reason either ignored or underestimated.
Which begs two questions. The first is: What warning signs should have been picked up before the Steinhoff revelations? And the second is: Who should have spotted those warning signs or signs that something was not right?
In no particular order, let’s consider some of the possibilities. First up we have the obvious option – Steinhoff’s CFO, Ben le Grange, who has also subsequently resigned, although resignation doesn’t absolve one from any alleged culpability.
Then one has to look at the scores of accountants, internal auditors (one would think they’d all been made redundant) and other employees who had access to financial transactions and reports. Were they just incompetent, so financially illiterate that they couldn’t understand the significance of what they were managing, were they intentionally or unintentionally turning a blind eye, disengaged, corrupt or so afraid that they never once spotted something amiss nor spoke out about it?
What about board members? Did they not ask any pertinent questions, ask for confirmation, verification and the like? And what about the company’s external auditors? How did things slip through their fingers?
Clearly, a lot of people turned a lot of blind eyes for a lot of the time… or a lot of people were keeping quiet.
It would be interesting to establish if anyone did try to alert the necessary authorities about something amiss.
If not, this also points to a possible failure regarding the company’s HR function. The HR Director is responsible for ensuring there is an appropriate culture in the company. It would appear there has been a culture of secrecy or fear in the company. That would have ensured that everyone kept quiet. Was this just accepted as normal?
It’s time for business leaders to collectively turn their backs on the so-called “wonder boys” who pretend to be leading their companies to success while ruling by fear and flouting generally accepted business and ethical principles in order to amass fortunes for themselves.
It’s also time for us to start making honesty cool and fashionable again. And we do that by accepting that there are no degrees of honesty like “fairly honest” or “very honest”. I’ve said it before – honesty is not the best policy. It should be the ONLY policy. If you’re not honest, you’re dishonest and have no place in a position of responsibility in the public or private sector.
Chances are there are a whole bunch of Markus Joostes out there who need to be exposed before they wreck other people’s futures. Hopefully, our legal, regulatory and professional bodies will take the necessary appropriate action to send a very clear message to all business leaders and their employees that dishonesty will not be tolerated nor overlooked.
If you happen to know of things that are being done in your company by someone, no matter how senior they are, be brave enough to alert the appropriate authorities to what you are aware of. You will be acting in the interests of hundreds, if not thousands or millions, of other people. The old saying is still just as true today as it was when it was first written – evil prospers when good men and women do nothing.