I was in Ottawa earlier this week to participate in a roundtable discussion about ways in which Canada’s institutions (including its corporations) can restore the public’s trust in them. Hosted by the Conference Board of Canada, the roundtable had inputs from a wide range of what the Board’s Prem Benimadhu characterized as “intermediaries” between institutions and the public. There were reps from NGOs (Oxfam and the YMCA, among several others), the Canadian Human Rights Commission and the Auditor General’s office, and the media, which explains what I was doing there with so many people smarter than I.
Lots of interesting discussion, which focused in large part on the need to measure levels of public trust–something most Canadian boards of directors, it was generally agreed, do a pretty poor job of. My own major point was that such measurements of trust and reputation should also be taken internally, within the corporation, as a way to gauge not only attitudes but to get a handle on practices among employees that carry the potential for reputational damage. Transparency, in other words, should not just be directed towards the public, but used within an organization.
Another, unrelated thought on these lines: if indeed public trust in our companies is below where it should be, then maybe our legal system can bear some of the blame as an important intermediary between corporations and the hoi polloi.
After all, people might not feel so distrustful of corporate Canada if they actually believed that when a corporate officer did something criminal, like fraud or securities offences, he or she might be caught by the police, tried in a court of law within five years, and once in a great while found guilty and sentenced to a meaningful prison sentence. In other words, it might be helpful for the reputation of Corporate Canada if white-collar criminals actually paid for the damage that they do.
This is a not so humble suggestion, because it so rarely happens this way. As we noted in a recent issue of Canadian Business, the efforts of the RCMP’s Integrated Market Enforcement Teams, set up several years ago to combat financial crime, have resulted in all of two convictions–both against the same person, and a pretty small fry at that. In the United States, the record of the president’s special task force on corporate fraud is a little more impressive: 1200-plus convictions in the past five years, including Canada’s own (for most of his life, anyway) Conrad Black.
Given the laxity of this country’s enforcement of corporate fraud, it’s a wonder the public has any trust at all in its businesses. Then again, how would the general public know what’s really going on?