South Africa is once again making the headlines for all the wrong reasons: corruption in high places and the looting of national assets by local and foreign interests – “state capture”.
Long regarded as a domestic political issue, recent developments in business are quickly dispelling that notion. In a stunning turn of events, the Johannesburg-based global audit and advisory firm, KPMG, retracted a report which implicated the former South African finance minister, Pravin Gordhan, in illegal actions which took place in his organisation under his watch. His subsequent dismissal is widely seen as an orchestrated move to remove him from office because of his stubborn resistance to corruption.
A further astonishing development was the allegation that the international consultancy, McKinsey, facilitated deals between the Gupta family (accused of being one of the king-pins behind corruption) and state-owned entities.
The public and some businesses have reacted with outrage. Trade unions and civic groups have taken to the streets in protest. And one of the parliamentary agencies has declined to renew KPMG as its auditors.
However it is the response by the audit and accounting fraternity that is really very revealing.
In a debate held at the University of the Witwatersrand last week, Nkululeko Gobodo, the first black women to establish an audit practice in South Africa, repeatedly alluded to the fact that the remedy was to attend to the culture within the country. In my view, few were listening as voices were clamouring for revising the codes of conduct, rules of audit practices and punitive actions for breeches.
So when it comes to the thinking and behaviour of consultants, technical advisors and management specialists; unless these groups recognise that even advice and not only action, is subject to ethical scrutiny, we will remain transfixed on the horns of a dilemma. Do we create a rigid set of rules for ethical behaviour and punish the frailties of human nature or do we set up a clear framework and appeal to the morality that exists in people to play it according to the rules?
I don’t believe that it is a case of either/or but both/and; a clear framework of acceptable behaviour and a community that ensures its compliance.
There are many elements to establish these conditions and the one that stands out for me and one that everyone seems to avoid is the cultural element; “a community that ensures compliance”. Cultural change is undoubtedly most challenging and “tampering” with it poses a perceived threat to many organisational leaders.
However, unless leaders subject themselves to the process of examining their own values and beliefs and personally committing to a new set of values, the likelihood is very remote of coming up with a culture that has an “immune system” to reject the influence of corrupt and distorted thinking and behaviour.
In the end, it is sometimes easier to change the leader than it is to change the leader.