There is a Millennial wave sweeping the globe in this decade and it’s bringing with it a whole new focus on ethical behaviour, not only socially, but culturally and in business.
Globalisation has thrust people and communities together and in so doing has created a mixture of diverse principles of behaviour and social etiquette. Consider Westerners having to undergo socialisation workshops in order to do business in other countries, and having for example to learn the social behaviour rules for women in the Middle-East and Asia.
What then are the rules of business that are globally accepted? Global and local events in the past decade and in particularly the past two years has exposed the fragility of our own personal norms within the global stage. Enron, Lehman Brothers and others are just the tip of the iceberg. Since then to mention a few, we have had Wikileaks, the Panama Papers, Donald Trump vs Hilary Clinton and the confusion of Brexit.
In South Africa, like most countries bribery and corruption has always been an issue but since 1994 it has developed into a frightening socially accepted practice that has delivered this nation, its people and its economy into the hands of Global Organised Crime. But let us not dwell on what is already well documented and obvious.
We live in a changing world where our own survival will depend on the values we personally apply to the way in which we conduct business and thankfully, although the war is only just begun, the battle lines are being drawn between what is ethical and what is criminal -what is acceptable and what is not.
The threat to ethical communities of non-ethical behaviour is being talked about and being acted upon by those agencies and regulators that still have a voice. Take the recent penalties and tainting of brands such as Rolls Royce, Samsung, and others who have been charged with bribery. Closer to home, the scandal of the South African Arms Deal and the reputational damage of those persons and organisations implicated rightly or wrongly will not just go away.
The questions business leaders must ask are: “What is my brand and reputation worth and how will my organisation be impacted if we do business with someone whose ethics are being challenged in the public forum? Can I afford to do business with the someone with a reputation for unethical dealing (the “Guptas”), because sooner or later such an association will be revealed?”
There is a notion in some large organisations that if a financial provision is made for the penalties that may arise, then the threat can be mitigated -rather like being self-insured against the occurrence of bribery or unethical behaviour.
This strategy will no longer work in the new battlefield, because the shock troops of enraged citizens who are now able to build and share public opinion cannot be silenced any more. Social Media has seen to that.
The only strategy is to actively promote your organisation and its reputation as being actively engaged in preventing corruption and fraud, not merely promoting good behaviour.
That means looking inwards and outwards to identify this rising threat and developing a corporate culture that truly embraces good governance and ethical behaviour. Codes of conduct on their own cannot do this. They must be seen to be instilled in the workplace. With the possible exception of professional bodies that demand compliance to the codes, there may only be local or regional regulations that will be often be challenged in courts of law, thereby placing the judiciary in the same position as the biblical King Solomon having to dispense the ultimate judgement.
In 2016 however, ISO published ISO37001, the framework for implementing and managing an Anti-Bribery Management Standard. That in itself was interesting because it revealed that there is a global business case for such a standard. What is way more surprising however is that it has been seized by many large and small organisations around the world, and organisations are actively applying the principles therein.
This has happened in less than 12 months and for the first time ever in over 3 decades of consulting, I was confronted by a potential customer, not with a demand for our BBEEE credentials or our Tax Clearance but with a copy of their Anti-Bribery Policy! Needless to say this was not a South African organisation.
So what is ISO? ISO standards are not a mandatory or legal requirement in themselves, but business communities have made them so in their own domain by insisting that their suppliers are certified in one or more ISO standards. When ‘quality’ was the only buzzword 30 or more years ago, it was fashionable to insist that your supplier was ISO9001 certified. Now suppliers are required by their customers to have a Business Continuity Management System (ISO22301) or an Information Security Management System (ISO27001) and other standards relating to their specific Industry.
Now there is the new buzzword and its called ‘Bribery’. More and more organisations will be insisting that their suppliers adopt an Anti-Bribery stance and it seems that ISO have set the first global benchmark.
ISO37001 is a fully certifiable standard and aiming to be “ISO37001 Certified” should be a goal for all organisations that are serious about ethical practices. As we know however, possessing the certificate only implies compliance and this must be backed up by the Check-Act stages of the Deming wheel. The Management System must undergo regular internal Audits and Management Reviews and annual Surveillance Audits by the Certification Body. Even with a fully effective and efficient ABMS (Anti-Bribery Management System) in place there is no guarantee that bribery will be prevented, but consider the conversation in the media and in front of the Judge:
Judge: Have you implemented recognised audited measures to prevent Bribery?
Judge: You and the Board of Directors are therefore found guilty and I must therefore impose the relevant penalties and payment of the costs incurred.
It would far better to be able to say:
‘Yes, and we have identified the controls that failed and taken additional measures to ensure that the situation does not recur’