A MESSAGE FROM THE AUTHORS
Hello, and welcome to the first issue of our Trust and
Leadership newsletter. We plan to publish issues every
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this first issue we examine the Sarbanes-Oxley Act as
it approaches its first anniversary. This is an op-ed
piece that appeared in the Boston Globe on Sunday, March
2. What are your thoughts on Sarbanes-Oxley? Let
In future issues we'll discuss
creating communities of trusted leaders, fostering vitality
in your organization, appropriate personal attributes
and behaviors, and a series of articles that a certain
food fanatic who shall remain nameless has dubbed "A
Leadership Dim Sum.'
Please forward this newsletter
to your colleagues and friends who are interested in
organizational and leadership issues.
-Rob and Anne-
TRUSTED LEADER IN THE NEWS
Chief Executive Magazine: Build Trust within Your
Entrepreneur Magazine: Trust Me?
- Rob Galford
- Anne Drapeau
Annual Awards Dinner
Keynote Address by Robert Galford
May 15, 2003, Waltham, MA
It will take courage to restore
Robert Galford and Anne Seibold Drapeau, published in the Boston
Would a universal code of
ethics make any difference in the behavior of our corporate
leaders? Would placing employee representatives on corporate
board audit committees make financial information more honest
and accurate? These are some of the latest recommendations
for addressing our crisis of trust in corporations. But will
they work? In the first instance, forcing executives to pledge
good behavior is not likely to protect us from evil-doers.
In the second case, mandating employee representation on board
audit committees won't do much more than add a layer of bureaucracy
to a reporting process that is newly burdened by the provisions
of the Sarbanes-Oxley Act.
mandates that companies put in place a new level of auditing
and boardroom assurance procedures. The intended result is
to provide greater confidence in the validity of the financial
reporting that these companies provide, and thus protect and
reassure investors and the investing public. It's not a bad
in focusing so much of the time and energy of corporate executives
on solving the problem of ''making Wall Street investments
safe for Main Street investors,'' it significantly distracts
these executives from the time and energy required to work
on something even more critical to their survival. That something
is the building or restoration of trust in their leadership
-- in the marketplace, with customers, and among their employees.
Employees wonder whether their leaders are giving them the
straight scoop, and if their organizations are telling them
the straight story.
while the legislation is designed to restore trust in accounting,
what we really need is an effort to restore trust in leadership.
The Sarbanes-Oxley remedy merely addresses the symptoms of
trust destruction (that is, bad reporting, or bad acting),
rather than its causes. What is required of chief executives
is not committee members or codes, but courage. So where does
starts with the courage to talk about trust explicitly and
to make it part of one's vocabulary, not just for investors
but for customers and employees. It comes from the actions
of CEOs such as Procter & Gamble's Alan Lafley, who walks
around the company talking to everyone from assistants to
managers, and inspires descriptions such as ''a leader that
many of us would walk across hot coals for.''
means the courage to take clear stands when behavior might
look dodgy to those on the outside, and to look closely at
what they as organizational leaders must do to defend trust.
Look at Diebold chairman and CEO Walden O'Dell, who opened
what would have been a routine quarterly earnings conference
call by offering to lay bare Diebold's policies on disclosure,
generally accepted accounting principles procedures, corporate
governance policies, and ethical standards. There had been
no accusations or dissent. It was simply a proactive gesture
to instill trust.
organizational managers and leaders, we must be explicit about
trust. We have to talk about it more, ask our people about
it, make it a stated value and not just assume it. Give people
ways to ask about it or question it, know how to repair it
when it is damaged or lost, work on building it when it is
missing. It may mean lots more listening than we'd rather
do, and lots more apologizing, affirming, or acknowledging
than we might feel is necessary. Our job is not to reward
it when we see it, but to expect it, to build it in, to make
it the default.
courage, not more regulation, that will give trust a better
You may have seen some of our references to the following
two reports from Watson Wyatt and Mercer. Both legitimize
the argument for the importance of organizational trust. We
thought you might want to see them.
workers feel pride in jobs, organizations, but dont
Watson Wyatt: WorkUSA®
2002 - Weathering the Storm: A Study of Employee Attitudes
Do you know of an article or report that would be of interest
to our readers? Please let
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