Siemans Effective in Ethics Scandal Prevention?

In an article in this month’s CFO.com on Sieman’s much-discussed bribes-for-contracts scandal, an IT solution is described that has been designed to prevent the possibility of payments being generated absent a clear identification of the recipient. Sounds like a terrific, if belated system to help account for where their money is going (i.e. not for bribes…). When asked about how an ethics problem came to have an IT solution, Joseph Kaeser (CEO) is quoted as saying, “enforcement is key. It’s not enough to fire people after something is detected; we must prevent it.”

Now I’m well aware that this quote may be missing some significant context so I don’t want to make too much out of it, but can this really be considered a radical concept these days? First of all, who’s been asleep at the wheel so long that they’re just now figuring out that the prevention of ethics problems, rather than merely cleaning up after them, might be a good or even cost-effective idea? Secondly – and, admittedly, this is where a lack of context may have given me the wrong impression – how successful will an IT solution be in the absence of a corporation-wide focus on both developing and maintaining a culture of ethics? No matter how effective the IT solution might be, there will always be folks able to either work around it or simply come up with other ways to act unethically for their profit, convenience, or both. 

To be clear, I’m not suggesting that such technical approaches are a bad idea. Far from it, actually. I think the more thorough and effective our automated checks and balances can be, the better. Rather, I’m saying that developing those oversight systems – whether automated or human – can never begin to substitute for thorough and effective initiatives to build and maintain cultures of ethics in businesses of all types and sizes.

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>