The Amazing Age of the Outraged Leader Who Knew Nothing

Jon Corzine, the former chairman and CEO of the collapsed MF Global Holdings, is in court battling with the Commodities Futures Trading Commission over liability as the person in charge when the brokerage firm hijacked customers’ account to support its bets on solid investments like Greek bonds. Mr. Corzine’s lawyers have argued that “no principle of law or logic” supports the CFTC position that Mr. Corzine should be held accountable for the losses. His lawyers have argued that Mr. Corzine did not control the accounts because transfers had to be approved by finance, treasury, and operations personnel.

Funny how leaders command and demand salaries, perks, attention, and obedience as their firms clip along. However, when something goes wrong, they knew nothing, they are outraged, and they did not wield the power to stop their staff of rogues. At VW, the CEO knew nothing about the trickery in the emissions software ginned up by dastardly engineers. At GM, no leader knew anything about the “switches from hell” that were scaring GM employees and causing suppliers to raise questions. The former head of the Secret Service knew nothing about the raucous behavior of agents that seemed to be legendary in the ranks and well known around DC and parts of the underworld in South America and Europe. Intelligence reports are whitewashed to make threats less ominous and leaders who receive those reports are outraged at the behavior of CENTCOM employees. IRS agents target taxpayers by name and purpose and leaders are angry about their behavior. The leaders vow to “get to the bottom of all of this” with a full investigation. Sadly, the leaders are already at the bottom, on so many layers.

A leader who demands results, repeats mantras, and uses fear to bring out the worst in decent employees is indeed the controlling person. Assigning physical control of accounts, operations, or products to others is a coward’s way of placing distance between self and action. The distance is not there except on paper because employees in respond in an autocratic and driven culture when the worst behaviors are recognized and rewarded even as those who throw down flags are cast out. Mr. Corzine got rid of a risk officer who challenged the firm’s exposure. How more hands-on can a leader be than signaling that he brooks no dissent? The authority to transfer to and from accounts is not the issue. The authority to drive employees to engage in wrongful transfers is. Under today’s leadership principles, cowards step up to claim technical innocence and escape accountability for behaviors on their watch — a watch in which they poisoned minds and culture, driving others to do their dirty deeds.

About mmjdiary

Professor Marianne Jennings is an emeritus professor of legal and ethical studies from the W.P. Carey School of Business at Arizona State University, retiring in 2011 after 35 years of teaching undergraduate and graduate courses in ethics and the legal environment of business. During her tenure at ASU, she served as director of the Joan and David Lincoln Center for Applied Ethics from 1995-1999. In 2006, she was appointed faculty director for the W.P. Carey Executive MBA Program. She has done consulting work for businesses and professional groups including AICPA, Boeing, Dial Corporation, Edward Jones, Mattel, Motorola, CFA Institute, Southern California Edison, the Institute of Internal Auditors, AIMR, DuPont, AES, Blue Cross Blue Shield, Motorola, Hy-Vee Foods, IBM, Bell Helicopter, Amgen, Raytheon, and VIAD. The sixth edition of her textbook, Case Studies in Business Ethics, was published in February 2011. The ninth edition of her textbook, Business: lts Legal, Ethical and Global Environment was published in January 2011. The 23rd edition of her book, Business Law: Principles and Cases, will be published in January 2013. The tenth edition of her book, Real Estate Law, will also be published in January 2013. Her book, A Business Tale: A Story of Ethics, Choices, Success, and a Very Large Rabbit, a fable about business ethics, was chosen by Library Journal in 2004 as its business book of the year. A Business Tale was also a finalist for two other literary awards for 2004. In 2000 her book on corporate governance was published by the New York Times MBA Pocket Series. Her book on long-term success, Building a Business Through Good Times and Bad: Lessons from Fifteen Companies, Each With a Century of Dividends, was published in October 2002 and has been used by Booz, Allen, Hamilton for its work on business longevity. Her latest book, The Seven Signs of Ethical Collapse was published by St. Martin’s Press in July 2006 and has been a finalist for two book awards. 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, Washington Post, and the Reader's Digest. A collection of her essays, Nobody Fixes Real Carrot Sticks Anymore, first published in 1994 is still being published. She has been a commentator on business issues on All Things Considered for National Public Radio. She has served on four boards of directors, including Arizona Public Service (1987-2000), Zealous Capital Corporation, and the Center for Children with Chronic Illness and Disability at the University of Minnesota. She was appointed to the board of advisors for the Institute of Nuclear Power Operators in 2004 and served on the board of trustees for Think Arizona, a public policy think tank. She has appeared on CNBC, CBS This Morning, the Today Show, and CBS Evening News. In 2010 she was named one of the Top 100 Thought Leaders in Business Ethics by Trust Across America. Her books have been translated into four different languages. She received the British Emerald award for authoring one of their top 50 articles in management publications, chosen from over 15,000 articles. Personal: Married since 1976 to Terry H. Jennings, Maricopa County Attorney’s Office Deputy County Attorney; five children: Sarah, Sam, and John, and the late Claire and Hannah Jennings.
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