Search

Editors

Richard L. Cassin Publisher and Editor

Andy Spalding Senior Editor

Jessica Tillipman Senior Editor

Elizabeth K. Spahn Editor Emeritus

Cody Worthington Contributing Editor

Julie DiMauro Contributing Editor

Thomas Fox Contributing Editor

Marc Alain Bohn Contributing Editor

Bill Waite Contributing Editor

Shruti J. Shah Contributing Editor

Russell A. Stamets Contributing Editor

Richard Bistrong Contributing Editor 

Eric Carlson Contributing Editor

Bill Steinman Contributing Editor

Aarti Maharaj Contributing Editor


FCPA Blog Daily News

« Job: Compliance Officer (Bilfinger SE - Mannheim, Germany) | Main | Private jet owner, two others, plead guilty in New York-to-Panama money laundering sting »
Monday
Jan252016

Boehme and Kimmel: What Rahm Emanuel can teach us about trust (we're serious)

Rahm Emanuel, besieged by angry crowds clamoring for his resignation or recall, now admits, “We have a trust problem.” Well, Duh. 

We think both Chicago and its mayor have some strong and graphic lessons in trust to share with CEOs, boards, C-suites, CCOs, government officials, and even some of the political candidates for our nation’s highest office.

We have a particular interest in trust and culture development, and have carefully followed Chicago’s protests for this reason. In any organization (corporation, government agency, city or nation), trust is a precious and highly valued commodity. Trust, like all other elements comprising an organization’s culture, can’t be bought or “delegated” by its leaders, but evolves organically in direct proportion to individuals’ perception of transparency, honesty, fair play and organizational justice.

Trust Across America-Trust Around the World (TAA-TAW) has offered some guidance for community leaders seeking to build a culture of trust and transparency that provides a good starting point.

Senior leadership of companies would be well advised to think of their organization’s level of trust as the fluctuating result of the ripple effect of leadership’s words and actions at any given time. When leadership’s actions match its words, positive ripples of trust occur. Similarly, when leadership’s actions do not match its words, or do not reflect consistent values or transparency, negative ripples result. 

It’s human nature for employees, voters, and other constituencies to have a natural, basic hunger for organizational justice -- the sense that the rules of the organization are fully transparent and apply equally to everyone. Every police force needs its citizenry to feel that its actions are moderated by protocols and rules (consistently applied), and every community hungers for leaders who act with transparency, trustworthiness and a sense of organizational justice.

For example, despite the effects of lay offs on both those employees that are laid off and the remaining survivors, fairness and consistency in the procedure to carry out the layoff program has a notable and positive effect on both parties and the organization. Former RAND expert on organizational justice, Jerald Greenberg, says that such lay offs go well where:

  • Management is clear and truthful on the reasons for, and process to be used to implement, the layoff program
  • The terms of the program are explained accurately in employee communications in advance of the event, and
  • Employees have confidence that the rules have been fairly applied to all.

The layoff case studies confirm one enduring principle of organizational justice: Companies can’t guarantee fair results, but they can guarantee that the process will be fairly applied to everyone. This principle of procedural fairness is Exhibit A for the value of truth and candor in employee communications -- a key element of any successful culture of trust and ethical leadership.

And here are the lessons we think companies and their leadership can take from Chicago and its embattled mayor:

  • Leaders who match words to action (“walk the talk”) build trust as ethical leaders and role models.
  • Transparency drives trust and an ethical culture.
  • The cover-up is always worse than the original problem.
  • If there’s a problem, tell it early, tell it all, and tell it yourself.

But let’s be real here. The time it takes to build trust is directly proportional to the frequency and number of positive trust–building interactions combined with attributes like character, competence and consistency. 

TAA-TAW calls this the VIP Leadership Model (Values, Integrity and Promises kept).

There is no doubt that Chicago has a trust problem, and from all accounts the roots are deeply embedded in the culture, in both the mayor’s administration and the police department. In a perfect world all mayors and their respective administrations would choose to act, visibly and transparently, in a way that encourages trust, but the world is far from perfect. 

The Windy City is simply the latest example of misdirected leadership and  politically driven decision-making. There is a better way forward for all organizations, but first, leaders must acknowledge when a problem exists.

If Chicago and Rahm Emanuel want to move forward and heal the wounds of the recent controversies, he and his administration must actively work to rebuild trust and credibility as a foundation of an ethical culture and organizational justice.

______

Donna Boehme is the Principal of Compliance Strategists LLC. She has advised a wide spectrum of private, public, governmental, academic and non-profit entities on organizational compliance and ethics. @DonnaCBoehme

Barbara Brooks Kimmel is the CEO of Trust Across America – Trust Around the World whose mission is simply to help organizations build trust. @BarbaraKimmel

Reader Comments (1)

That is the point in a Corporate Culture and Compliance' objectives. Honesty "can't be bought" and it is the Value again after being in a shadow of timidity. Excellent article.
January 25, 2016 | Unregistered CommenterAndrey Philippov
Comments for this entry have been disabled. Additional comments may not be added to this entry at this time.