Missing the Point: Lessons From Novartis: Shareholders Win the Compensation Revolt but Lose the Ethics Revolution

The actions and commentary surrounding the recent shareholder revolt over the proposed $78 million payment to departing Novartis Chairman Daniel Vasella offer a range of ethics and governance lessons. These are critical across all sectors from corporate to non-profit to governmental. My purpose is never to attack an individual leader, an organization, or commentators. My intent here is learning, especially as it seems inconceivable that this kind of situation could continue to occur following the relentless say on pay and other ethics events of 2012. Read more →

The Test of Time Part I: Proactive Ethics Oversight

I have been obsessed with time as an intellectual matter (Proust and Einstein…), a cultural matter (orchestra conductors, Big Ben, the Great Wall building process), an organizational matter (school bells, oven timers, day light savings time, airport schedule boards, time zones…), and a social matter (fashionably but annoyingly late). Time is perhaps the biggest challenge of ethics oversight for all organizations, whether for-profit, non-profit, academic, or governmental. The ethics of time is indeed intellectual, cultural, organizational, and societal for most organizations. Above all time also underlies the challenge of managing unpredictability that underlies all of my ethics work. The key is to use time proactively – that is, put time on your side. Read more →

It Isn’t Personal

Introductory phrases such as “in our case….” or “given our board’s history…” or “in light of the expertise and dedication on our board…or “the culture of our organization prevents….” increasingly invade discussions of governance, accountability, transparency, and ethics (what I call “GATE”). For example, some boards consider that because they rarely have conflicts of interest, a meticulous conflicts procedure may not be necessary. Others believe that the board Chair is so competent that he or she should have a more extensive role in governance decisions (committee structure and assignments, succession planning, CEO evaluation and remuneration analysis….) than GATE suggests – a sort of efficiently benevolent and competent dictatorship. Other boards rule out certain GATE policies or mechanisms as inconsistent with the organization’s “culture”.

Read more →

Role Playing

Three scenarios:

I recently had the great privilege of attending a dinner with a number of high level participants in the climate change issue. The attendees represented a diverse group from academia, government, business, philanthropy, non-profit advising, and international conferences – leaving only the multilateral organizations unrepresented. As is usual, and indeed interesting, every participant spoke from his or her experience. However, there was not a single comment during the evening that considered the most effective role for, or the most effective working relationship amongst, each of these actors in addressing the climate change issue.

Read more →

First in Class Governance, Accountability, Transparency, and Ethics: The Law is the Lowest Common Denominator Not the Highest Form of Excuse: Part I

I recently received two Google Alert e-mails:

The first was an article about the Red Cross scandal in China (explaining the impact on the organization’s reputation from a young woman making false claims of management responsibility within a division of the Red Cross (that the Red Cross claimed did not exist) photographed perched bejewelled on a luxury car). The second explained a new donor transparency regulation in China (requiring disclosure on a range of matters relating to the donation, fund-raising practices, and use of funds).

Read more →