There are many corporations that fail to understand the damage that arrogance does to the culture of the company. A little humility goes a long way to building trust with stakeholders, which is required if an entity wishes to become more resilient. Community members and other stakeholders switch off when they perceive arrogance.
In his 2012 New York Times OP-ED, Greg stated the following: “culture was always a vital part of Goldman Sachs’s success. It revolved around teamwork, integrity, a spirit of humility, and always doing right by our clients. The culture was the secret sauce that made this place great and allowed us to earn our clients’ trust for 143 years.”
Greg Smith left Goldman Sachs in early 2012 because, as he said, he looked around and could “see virtually no trace of the culture that made me love working for this firm for many years.”
I have personally worked for a company where arrogance was a substantial part of how they did business. I remember an executive walking into a morning briefing in our London office and claiming that our company was the largest in the world by market capitalization. Moreover, he stated that “governments do what we tell them to do, not the other way around”.
Silence fell over the conference room where the executive made his claim. Employees left the presentation with a sense that they were working for the wrong organization, not with a sense of pride. It was at this moment that I realized I should look for another job.
The arrogance of my former employer pervaded every part of the business. As reported elsewhere, there was a high-level of tension in the organization and every interaction was “fraught with conflict.” It felt like I was working in an environment where survival of the fittest was paramount.
In an article titled What Do Corrupt Firms Have in Common? (a must read), it is stated that arrogance, complacency and opacity are leadership skills that encourage corruption. So, in order to prevent ongoing ethical lapses, companies need to stamp out these leadership traits.
Organizations spend an exorbitant amount of shareholder money on compliance systems, without realizing where their highest risks lie and not seeing that corporate culture is an integral part of the solution. In addition, many companies don’t understand that corporate culture is something that is nurtured over time.
Preventing corruption and bribery won’t be achieved through an effort to development a world-class compliance system, alone.
As reported in the Harvard Business Review “The root cause of the problem isn’t ineffective regulations and compliance systems, however. It’s weak leadership and flawed corporate culture.”