Business scandals like the one now involving Walmart and alleged bribery and corruption cause all of us to shake our heads and wonder how something like that can happen – or be allowed to occur – when we as individuals and corporations alike profess to wanting an ethical culture. At first glance, it would seem that companies are talking out of both sides of their mouths. To employees they say, “Do what we say and follow our policies,” but for the corporation at large, the cynical view leads one to believe that it’s all talk and no action.
It’s not always easy to do the right thing. Sometimes it’s not a simple matter to even know what the right thing is. That’s what policies are for, of course. Ethics is often an uphill battle. Corporations leverage programs and awareness campaigns to make clear the position of the company on matters such as bribery, so that employees have the tools to recognize malfeasance and know how anonymous reporting works. At the front-line level, these methods work well and are usually well-received. When an issue arises locally, compliance teams can investigate and roll up corrective action plans to prevent future occurrences.
The problem comes when issues occur at the executive level or in areas outside of “routine scrutiny,” such as Walmart de Mexico allegedly bribery Mexican officials to grease the wheels of business expansion. As FCPA pundits have pointed out over the past few days, Walmart’s apparent actions show a disregard for global legislation as well as proper procedure for handling such allegations at the point of origin or working to prevent future issues. It’s the age-old quandary of escalation and follow-up.
Granted, according to a Compliance Week article and a statement issues by Walmart, the retailer is taking “a number of actions to establish stronger FCPA compliance” which include “issue escalation and remediation protocols.” Perhaps the US Department of Justice will show leniency toward Walmart should the company come clean on all matters related to the allegations and prove that they have learned their lesson. The bad news in this is that the ethics ball has only rolled further down the hill.
At some point, business leaders will get it – ethical practice means ethical action, and that the drive to succeed must be balanced against the ethical principle of not stepping over that line. Solid compliance initiatives can go far toward winning the ethics battle, but all of us, and most especially business leaders at the very top, must learn to push the ball up the hill.