The relationship between advisers and their clients has come under scrutiny on a number of levels. The golden rule of business states that he who has the gold makes the rule but, as Dr Trevor J Bentley asks, what if this threatens your own moral or ethical standards?
Professional services whether legal, accounting, consulting or PR constantly face the decision of to what extent they place the needs and/or demands of the client over their own needs to operate ethically and morally. The pressure to "go along" and not challenge a client can be enormous – and not just in relation to the threat of losing business. The type of pressure professional advisers can feel over challenging client actions can be seen in ASIC's civil action against the NRMA's Nick Whitlam. ASIC has alleged Whitlam improperly dealt with proxy votes, with some 4000 votes that did not support a pay rise for directors ending up as invalid. In his evidence the returning officer, a senior partner at Deloitte Touche Tohmatsu, said it was made clear to him that anyone saying Whitlam acted deliberately by failing to cast 4000 proxy votes "should be prepared to put their house on it". This dichotomy of collude or collide with the client is an ever present issue when the pressure is to "put the client's needs first". Successful service delivery is often judged on the basis of client satisfaction. So when the client isn't satisfied does the service provider back off and collude with the client, or collide and resign? One partner in a large professional organisation responded to my question by saying, "It is often quite a close call and we have to see how far we can go to meet the client's needs before we reach a boundary that we wouldn't cross".
Of course clients, if they don't get the advice that fits their needs, can always get a second, or even a third opinion and select the one that allows them the flexibility they are looking for. Unfortunately it is only too easy for a client to walk away and find someone less scrupulous who will collude with the client and pocket the high fees from doing so. Faced with this dilemma few professional service organisations have the guts to walk away and stick to their own values. In fact what we find in our work is that corporate values can be very flexible and can be all too easily massaged to fit with most client demands. Is this the acceptable or the unacceptable face of corporate capitalism where just about anything goes as long as it adds to the bottom line (at least for a time until the bubble bursts)? There have been a number of high-profile examples of organisations with low or no ethical values going to the wall, often supported by their professional advisers, Enron and Andersens being the leading example.
Of course, in Australia we've had our own share of corporate collapses where questionable business practices have played a part in the collapse, e.g. FAI and HIH. Even when a corporation doesn't come undone, they or the people involved can suffer serious adverse publicity if they're seen to be operating in questionable ways. Recently, of course, serious questions were raised about BAT's actions and the advice they received from their legal advisers at Clayton Utz. It is a greatly misunderstood or unrecognised truth that high personal and corporate values lead to vastly increased performance, particularly when personal and corporate values are aligned. In such instances, unfortunately all too rare, people enjoy their work, put more of themselves into it and perform at higher levels when their personal values are respected by the organisations that they work for. Organisations also benefit by retaining highly qualified people for longer and developing enviable reputations for being honest, reliable and straight in their advice and in the values that they espouse. Such businesses can sustain growth over long periods of time and keep their people costs, a major factor in professional service organisations, within reasonable bounds through lower staff turnover and maintaining a highly-skilled workforce. There is a need for all organisations to produce their core operating values, not as pompous vision or mission statements that sit around on walls, but as clearly laid out values of what they will and will not do in furtherance of their business aims. These values need to be embedded within the organisation, driving decisions and actions at every level, especially in the boardroom. There is also a need for organisations to make clear value statements about what they expect of their clients in holding to these declared values.
For us there is only one clear rule: when clients make any request that compromises our values we refuse – and if needs be resign. With large well-known brands such action will create unwanted PR, for them, and they will probably back down. The important first step is for the professional service organisation to stick to its guns and to refuse to collude, and in the process collide head on. Of course, this take a courage that's not always easy to find because of the pressures to get and keep clients and to make a buck. It also takes a longer-term view that's been clearly lacking in many professional services firms. And, from our work with professional services firms, we know it is possible to find both the courage and broader perspective required. Collusion or collision? There's really no question to answer: It has to always be collision. Interestingly there are very few examples of widely reported collisions.
* Dr Trevor J Bentley is founding partner of the space between, a consulting firm which believes that embodying human values leads to creating business value, forging the way for long-term survival
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