JIM FINNEGAN, Editor, Financial Engineering:
Perhaps as if on cue, this past month of May also offered me a unique opportunity to read an advance copy of a new book by our “Ethics in Finance” columnist, Marianne M. Jennings. The Seven Signs of Ethical Collapse How to Spot Moral Meltdowns in Companies Before It’s Too Late will be published by St. Martin’s Press in August. It is a superb book that I recommend highly to all our readers (and no, FEN has no pecuniary interest in the success of the book). Some of Professor Jennings’s seven signs of ethical collapse are straightforward (e.g., Weak Board of Directors). But one in particular caught my attention: “It’s All About the Numbers”(sign and chapter #1).
With her inimitable writing style, she points out how corporate cultures and management that become obsessed with numbers and meeting numbers targets for sales, profit and stock price are at the greatest risk for that oldest of corporate ethical lapses: Cooking the books. (At one company she uses for an example, she notes the practice went beyond “cooking”to London-broiling the books). And, it is often that confusion of personal net worth as the metric of self-esteem and achievement- either directly or through the economic, political and social power and status money conveys- that motivates people to do things they can later regret.
In the final analysis, the most important number for each of us to keep in mind is unknowable: The date of our own passing. And that date itself is much less important than the fact it represents: There is an end to our time here on Earth, and it’s not all about the numbers (unless you are planning to have a graph of the growth in your lifetime net worth on your tombstone). Those of us who work in or comment on the financial industry may be at greater risk of this confusion. Finance is a highly quantitative, numbers-oriented profession where markets provide a near continuous flow of updated data. And unlike the numbers that other professions serve up as their metrics of success (conviction rates for district attorneys, student graduation rates for teachers, OSHA injury rates for plant managers), our numbers are typically preceded by a currency sign giving them additional gravitas in our consumption-oriented (and status-obsessed) popular culture.
Oh, don’t think that I’m tossing out that elaborate spreadsheet with my past, current and forecast future net worth. In the same amount of time it took me to go from 35 to 50 (a mere blink of an eye in retrospect), I’m hoping to retire; so I need to continue planning for that day if I make it. But unlike my focus at 35 years old, at the half-century mark I’m less concerned with maximizing the size of my net worth and more concerned about how people will remember me and what I accomplish in my working career and life. And I’ll let each of you draw your own conclusions as to whether this change of thinking represents the onset of wisdom or senility.
Foreword by Dr. Laura C. Schlessinger Author and internationally syndicated radio talk-show host
I’ve been as frustrated as the next person with the reality that life and people just aren’t always fair, the good guys don’t always win, goodness doesn’t always win out, the best (wo)man doesn’t always get the job, honesty isn’t always the winning policy, and noble convictions don’t always pay off; nor does doing the right thing guarantee success, accolades, or even appreciation, much less a brass ring.
In fact, “doing the right thing” will often put you in a risky position. You could lose position, power, material success or your very life. Why? Because in the real world there is a constant battle between good and evil and evil has no shame, no limits, no rules, and largely, no fear. Against that formula many people crumble, acquiesce, and even abdicate their values. After all, there are profits to be made, children to be sent to private school, job opportunities too good to lose, connections to be made, perks to enjoy, an ego to satisfy, competitions to be won, vacations and lovely homes to be had and it seems that bending ethical rules or points of law is what everybody has to do if they want to be competitive.
Whew! Difficult choices. Why would you ever choose to buck the system and do the right thing, the ethical thing, when it’s so clear that you could pay a real and depressing price? Why would you choose to sacrifice profits, opportunities, and power for some noble ideal of personal and professional ethics and morality that clearly isn’t shared by those in your sphere? What’s really wrong with not speaking up for what or who is right if it’s going to hurt you? What’s really wrong with doing things you don’t believe in to keep and grow your job? What’s really wrong with sucking up or selling out when you’re only doing so to get yourself in a better position? What’s really wrong with making quality and service secondary to profit when there are supervisors to please and stockholders to satisfy?
These are good questions. These are questions you’ll face in one form or other just about every day of your personal and professional life. When the noble, idealistic convictions you were taught as a child come into conflict with your career goals, opportunities, and unforeseen circumstances, one very important thing happens: you come face-to-face with the truth of who you really are.
When you were a child you had dreams of what you’d do when you grew up. Don’t dismiss these dreams as silly, unrealistic fantasies. In your childhood dreams you were idealistic and altruistic. Your childhood dreams were directed toward a noble goal representing your special gift. Is the world ever better off when these dreams are set aside as naive, impractical, unrealistic, or foolishly innocent? Is it worth it to sacrifice being a good person in order to “do well”? Does “what” you are matter more to you than “who” you are?
Too many people answer “yes” to these questions. Many are willing to sacrifice the “good person” role for that of the most powerful, most known, most rich, most liked, most feared, or most (superficially) beloved. There is a tremendous amount of societal pressure to do just that, and currently there is also a paucity of societal shame, rejection, or punishment of wrongdoers.
Why then would any reasonable, sane person refrain from cutting that corner if they could get away with it? For many, the answer is in their upbringing: They just can’t make themselves break the rules and disappoint or shame their parents. For others, the answer is that they believe it would be an affront to God. For still others it is as simple as that they find that success without integrity brings no joy.
Success and possessions without integrity frankly are just a big letdown. To avoid that letdown feeling, many people compulsively grab for more and more and more only to feel let down time after time. That’s when some turn to drugs, alcohol, or compulsive sex in order to push away that letdown feeling.
The letdown is due to your soul and psyche not being satisfied. Those elements of your being can be ignored but ultimately not denied. When your goals or motivations are not worthy, when your tactics are not worthy of your goals, when your end result has no true nobility involved, your soul and psyche are starved of pride and true satisfaction. In addition, you will not be a happy person.
There is no happiness in a life scraped clean of integrity, morality, and ethics; life eventually feels meaningless.
As I prefaced my book How Could You Do That?! The Abdication of Character, Courage, and Conscience: “I don’t wonder that so many people search blindly for the ‘meaning of life.’ What they don’t seem to understand is that life does not have meaning through mere existence or acquisition or fun. The meaning of life is inherent in the connections we make to others through honor and obligation.”
I’ll leave you with this “gimmick” I use with callers on my radio program who are struggling with a moral/ethical dilemma after they’ve rummaged unsatisfyingly through their lists of pros and cons in order to formulate a decision. It involves a Dickens moment in which I become the Ghost of Christmas Future. I tell them that, “By the power vested in me because of this radio program I can project you twenty years into your own future and you can view yourself in live action as you are today. You get to watch yourself as you make this choice today. What do you want to see that will make you proud?”
Then, as the Nike commercial says, “Just do it.”
Well, I’ll always be proud of writing the foreword for Professor Marianne Jennings’s wonderful book about business ethics. Considering recent scandals of corporate greed and corruption, polls showing that high-school honors seniors believe cheating is one of many acceptable tools, and a general societal decline in valuing sacrifice, spirituality, and integrity (voting instead for acquisition, power, and self-actualization) this book ought to be considered a must-read in every classroom, every office, and every home.
Venture Literary Press Release:
The relationship between Greg Dinkin and Marianne Jennings goes back to the spring of 1997. Dinkin, an Arizona State MBA student at the time, was breezing through the final exam for his ethics class, when he came to a question that stumped him. Having developed a great rapport with professor Jennings, he figured that if he couldn’t get it right, he could at least make her laugh.
Jennings is so passionate about teaching ethics that she tends to get alarmed when her students don’t see the severity of a company’s ethical transgressions. She’s constantly trying to convince revenue-minded students not only that there’s more to business than the bottom line, but also that good ethics leads to the bottom line. When her students don’t show the concern that she does when presenting one of many case studies on poor ethics, her signature reaction is to scream, “Where’s the outrage?”
So when Dinkin couldn’t come up with an answer to the question on the final exam, rather than leaving it blank, he simply wrote, “I can’t remember the company’s name, but I remember feeling outrage.”
Jennings has another distinct memory of Dinkin. One day after class, Dinkin challenged her with a hypothetical question. “If one of your family members was about to die and you didn’t have the money to pay for an operation, but you were offered a bribe to cook the books at your company that would give you enough money to pay for the operation, would you do it?” When Jennings said no, Dinkin responded by saying, “You’re a heartless wench.”
Equal parts sarcasm and mutual respect, a friendship was born and the seeds for a fruitful business relationship were planted. Four years later, Dinkin, who is also the author of two books, cofounded a literary agency. During a meeting with a business book publisher, an editor told him that she was looking for writers who are Top 5 in their fieldÃ¢â‚¬â€not such an easy find. It then dawned on Dinkin that he didn’t have to go very far to find a business writer who was number one in her field. He called Jennings, who not only expressed interest in writing a book for a trade audience (she’s the author of six textbooks), but also had already started writing one.
That was the good news. The bad news was that when Dinkin called the editor back, she told him that books on ethics don’t sell. Other publishers didn’t have any better news, and one editor summed it up best by saying, “The word ‘ethics’ on a business book is the kiss of death.”
Frustrated, Dinkin brainstormed with his business partner, Frank Scatoni, who had worked for eight years at New York firms Doubleday and Simon & Schuster. Having been on the publishing side of the business, Scatoni has a knack for knowing how publishers think. He also knows that they love to copy a successful formula. “How about a fable?” he asked. “If it worked for Who Moved My Cheese?, Fish, and The One Minute Manager, why couldn’t it work for a book on ethics?”
Dinkin called Jennings with the idea, and to his surprise, Jennings had never read those books. All of a sudden, the roles had reversed, and Dinkin assigned homework to his former professor. “Go read Who Moved My Cheese?, Fish, and The One Minute Manager and then let’s talk.” Since all three books were runaway bestsellers, were less than 115 pages, and used a “fable” to teach important business lessons, Jennings agreed.
After reading all three in less than an hour each, Jennings was unimpressed. “There’s nothing to these books,” she said. “I can’t see why they were so successful.” But after giving it some thought, she came to a simple understanding. Good writers show rather than tell, and since biblical days, writers have used stories as a way to teach lessons.
Inspired by the mythical pooka character in the Pulitzer Prize-winning play Harvey (and award-winning movie starring Jimmy Stewart), Jennings began working on a proposal. The book, still untitled, focuses on Edgar and Ari, a pooka who follows Edgar around with the words, “Wouldn’t be honest. Wouldn’t be right,” whenever Edgar is tempted to follow his richer and more successful friends up the corporate ladder by bending the rules. The book not only weaves a page-turning fable, but also provides a ten-step action plan for applying ethics in order to build and maintain.
With Enron, Tyco, and Worldcom making front-page news, ethics has jumped to the forefront of business news and put Jennings, America’s leading expert on business ethics, into the media spotlight. She has appeared on CBS This Morning, the Today Show, and CBS Evening News. Her weekly columns are syndicated around the country, and her work has appeared in The Wall Street Journal, the Chicago Tribune, The New York Times, and Reader’s Digest. She was also given an Arizona Press Club award for her work as a feature columnist and has been a commentator on business ethics on All Things Considered for National Public Radio.
When Ellen Kadin, a senior editor at AMACOM in New York, read the proposal, it struck a chord. Her best friend was an attorney at Arthur Andersen, and ethics had dominated their conversations for months. After a conference call with Jennings and Dinkin, Kadin offered an advance on the book, which will be published in the spring of 2003. “Compromising ethics isn’t the ‘no harm, no foul’ violation so many people may have imagined where living with one’s own guilt was the only price to pay,” said Kadin. “All that Andersen and Enron did, and what Jennings’ book will do, is demonstrate that good ethics leads to greater success in the long run.”
When the next corporate scandal breaks, you’ll likely see Marianne Jennings in the news. And if her media appearances aren’t enough, her book not only has a chance to become a bestseller, but also will have Americans nationwide screaming, “Where’s the outrage?”