MANAGING in the

NEW WORLD

Inadequacies in corporate culture can result in poor ethical standards leading to possible wrongdoing. Corporate Strategy should envision a culture which is strongly compliance driven while also encouraging a truly open culture which allows all employees to voice their ethical concerns. During scandal investigations, investigators look for explicit knowledge about wrongdoing possessed by senior officers to incriminate them. Thus, senior managers avoid making detailed inquiries into the operations of the rank and file because of the fear that they would be compromised during an investigation. This behavior came to light during the investigation in the banking scandal where the term accountability firewall was coined. The senior officers knew they could not be persecuted for things they did not see, so they donned blindfolds! What has been witnessed is that senior officers set high targets for their employees and then distance themselves from their efforts to meet these targets, thus, insulating themselves from the repercussions of employees using unfair means to achieve them. However, US & UK Governments have asked for gradual removal of these firewalls. When the senior managers know that they cannot hide behind a wall, they will encourage openness as otherwise their positions will become untenable. 

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