Image courtesy Rae Allen
You’ve heard the quote: “Anonymity dilutes accountability.” In cities, people are disgustingly rude in a way they would never act in their small hometowns. On the highway, people flip the bird with no hesitation. The dark web is a cesspool of illegal activity. In the same way, corporations are home to humans who can get away with murder. A prime example is the case of HSBC Mexico and its bankers who covertly functioned as the financiers of Mexican drug cartels. For years, London leaders looked the other way despite being fully aware of the activity. Once the illegal activity was brought to light, not a single person was held accountable and the bank received a $2B fine (annual profits are over $40B). This is sickening.
Personally, I’m one of those ‘the glass is filled with 6 ounces of water” type of people. To me, people are not just inherently good or bad; they are both. The most important factors that determines behavior are contextual ones. I motorbiked across the same bridges to Diamond Island just weeks before Cambodians stampeded their fellow citizens to death. They did it because they were scared for their own lives and oblivious to anything other than survival. Some organizations are the same way, provoking similar survival mentalities through culture and incentives programs. However, others benefit from more thoughtfully designed systems which encourage behavior that puts a premium on the welfare of others.
In the 2015 New York Times article “Justice Department Sets Sights on Wall Street Executives”, Apuzzo and Protess explained a powerful shift in the approach the Justice Department is taking on corporate crime. Loretta Lynch announced new policies which target executives by incentivizing corporations to ‘cough up’ leaders in exchange for billions, potentially, in savings for doing so. This move was one of the first significant attempts made to improve accountability.
While this was big step, many more are needed next. Major companies such as HSBC are unquestionably muddied with politics and with that comes two major challenges. First, there’s potential for executive framing with these new policies, in other words coughing up the wrong people. One potential solution would be creating shared fines between groups of executives based on a percentage of their compensation. In Finland, speeding ticket fines are proportional to a driver’s annual income so wealthy people don’t get away with a mere slap on the wrist. It’s highly effective. The second challenge related to politics is getting organizations to actually name names. To avoid a hushed response, the justice department might develop a tip line or other anonymous format to gain leads.
Good for the Justice Department for taking responsibility to hold others to their responsibilities and now let’s hope they strengthen their approach.