By William K. Black
August 22, 2016 Kansas City, MO
The New York Times has a columnist who interviews business leaders. He interviewed, Bracken Darrell, Logitech’s CEO in a column entitled “Be Sure to Tell the Boss What’s Wrong.” When we, the co-founders of Bank Whistleblowers United, here a phrase like that our ears perk up. It is exactly the right message the CEO should send. The people who most obviously take that message to heart, in the most difficult circumstances for the employee and where following the CEO’s advice is most vital to the firm, are whistleblowers. Despite the title of the article, and the famous role that whistleblowers played in disclosing the frauds that drove the most recent financial crisis, however, the CEO never mentioned whistleblowers. The entirety of the discussion of basis for the title of the article is shown below.
What changes did you make when you joined Logitech in 2013?
Early on, we defined several values in the culture that I didn’t think were there enough. One of them was speaking up, and that’s the most important one. When people go through a tough time, as Logitech had for about four years, everybody’s talking about problems. But if nobody listens to them they stop talking about problems, so you don’t know what they are.
The most dangerous thing is to be sitting in an office and nobody’s telling you what’s wrong. So I immediately started talking about speaking up and moving fast.
In addition to the CEO failing to mention whistleblowers, two things stand out about the passage. While the writer chose this passage to provide the title and apparent theme for his article, he asked no follow-up questions. Even if the CEO failed to bring up whistleblowers, the author of the article should have asked about them and should have asked additional questions to flesh out the value of speaking truth to power in a firm.
Second, the CEO’s experience at Logitech appears to be that he never had an employee willing to blow the whistle. The CEO observed that “if nobody listens to them [those “talking about problems”], they stop talking about problems.” He notes that “don’t know that [the problems] are.” He correctly calls that condition the “most dangerous” for a CEO. But my co-founders Richard Bowen and Michael Winston, who held senior positions at corporations and blew the whistle did not “stop talking about problems” that they warned their bosses about when those bosses failed to “listen to” those warnings.
The CEO’s language has another “tell” that he does not even think about whistleblowers. Whistleblowers’ warnings are rarely simply ignored. When whistleblowers expose deliberate misconduct by their superiors, as both Richard and Michael did, the reaction of senior managers is not indifference, but hostility. Reprisals against whistleblowers occur because the warnings are accurate and the senior leadership is unwilling to prevent the deliberate misconduct because that is the conduct that is making them wealthy, though it often harms the firm.
The reader can see how much stronger the NYT article could have been had it developed the theme that framed its title. It is true that the refusal of employees and officers to speak truth to the CEO is among the “most dangerous” dysfunctions from the standpoint of an honest CEO. That indices that when the reaction of senior managers to a whistleblower’s warnings is hostile it is one of the clearest possible signals that the senior management is dishonest and setting a criminal “tone at the top” of the firm.
If any CEO wishes to signal a bona fide commitment to establishing and maintain a culture based on encouraging employees to “speak up” about “problems” there is a simple means of doing so that would also create immediate substantive benefits. Hire Richard or Michael as senior managers. They have been through the crucible and proved their exceptional value. They were correct, ethical, loyal to the interests of the firm’s stakeholders, and they were courageous. Talk by CEOs is cheap. Who you hire and promote defines your firm.
If the CEO wants to build the bona fide culture of speaking up he or she should formally train ALL employees in what to look for and emphasize the message that blowing the whistle is the right thing to do
«Talk by CEOs is cheap. Who you hire and promote defines your firm.»
Talk in favour of honesty (and by jimini crickets :->) is also cheap.
CEOs know very well that persecuting whistleblowers has no downside as there is no conceivable risk of enforcement of rather weak laws.
So CEOs don’t want to hear cheap talk, they need compelling arguments why rewarding instead of persecuting whistleblowers can boost the market value of their stock options.
Because that’s how it works in Real America :-(.
LOL, CEOs want employees to speak up. That must be why most of them surround themselves with Yes men and women, make certain to kill every bearer of bad news, and then talk to the NYT about how important it is for employees to speak up. There are a lot of Dilbert cartoon pointy haired bosses around, discussing empowerment, speaking up etc.