In our previous blogs, we introduced you to THE CONCEPT OF CORPORATE GOVERNANCE
and ETHICAL LEADERSHIP BY THE GOVERNING BODY. In the next two blogs, we will be
discussing organisational ethics, and we will be interviewing an expert in this field, Dr
Janette Minnaar-van Veijeren, founding director of ProEthics (Pty) Ltd. During my corporate
career as the company secretary to the social and ethics committee and the chairperson of
the ethics task team, I had the privilege of working closely with Dr Minnaar-van Veijeren as a
corporate consultant and can highly recommend the services of ProEthics.
Janette obtained her LLD, LLB and BLC degrees from the University of Pretoria, where she
was admitted as an advocate of the South African High Court in 1991. Her social
contributions include serving as a director on the board of the Ethics Institute, serving on
the SA National Anti-Corruption Forum (NACF), mentoring young professionals, and many
more. As a true expert in her field, Janette has had the privilege to train the boards of some
of the most successful companies in South Africa.
I hope that you will enjoy this interview and gain some valuable insight.
Why did you start ProEthics?
I started ProEthics because I am passionate about ethical behaviour. As a lawyer, I
realised that policies and rules do not always encourage the right type of ethical
conduct and that there was a gap. Many companies with good intentions, who want
to do the right thing, do not know how to do so. We can assist with practical advice
and real-life know-how to implement ethical imperatives and initiatives.
How important is it for today’s boards to demonstrate their commitment to
corporate governance and ethics?
I believe that it is more important than ever, especially facing the economic pressure
that we are experiencing. If we are not seen to be ethical leaders, we are at risk of
staff doing whatever suits them, and we end up with companies that are not
profitable. There is ample research that shows that it pays to be ethical. It
contributes to sustainability, profit, good work relationships, a sound reputation, etc.
These companies can attract good talent and retain it because good people will leave
What are the most common ethical issues in corporate companies??
When companies are under financial strain, it is very tempting to bend the rules. This
can apply to contracts or tenders or even go as far as committing corporate crimes
such as corruption. There is, however, no right way of doing the wrong thing.
Something else we come across quite often is the abuse of power. People who are in
positions of authority can easily use that to either promote their personal agendas to
enrich themselves or to intimidate staff. When a staff member challenges this
behaviour by a leader, they are often threatened and victimised. In worse case
scenarios, they could get physically hurt or dismissed. A typical issue is disrespectful
behaviour, communication, or language. Another is discrimination in terms of not
valuing different opinions and views and not treating staff or stakeholders with
dignity. The moment this happens, employees become disloyal and disengaged, and
the organisation will not be as successful as it could be.
What is the relationship between corporate governance and ethics??
A straightforward way to look at this is to see the law, corporate governance, and
ethics as a three-legged chair. They are interlinked, and we need each of these three
pillars to establish a healthy organisation or for that matter, a broader society.
Corporate governance is how we direct and control the affairs of an organisation –
the structures, procedures that we put in place to ensure long-term success, and
profit. The law tells an organisation what it is allowed or not allowed to do.
Corporate governance or the policies and procedures that we implement in an
organisation help us to achieve that. The best set of organisational rules and
government policies will not support an organisation to be successful if the culture is
not ethical. Ethics sets the highest standards for organisations to attain or strive for.
In simple terms, being ethical means that the company, its leadership and its staff
must do what is right, do what is good and do what is fair, be responsible in their
behaviour, and consider others.
What are the likely consequences for an organisation that routinely sidelines or
completely ignores the importance of effective governance and ethics policies?
In worst-case scenarios it can lead to dishonesty: crimes such as corruption, bribery,
fraud, price-fixing, etc. are all against The Prevention and Combating of Corrupt
Activities Act or the Competition Act. A company found guilty in terms of offences or
transgressions of these acts may be fined, and if it is a criminal offence, the leaders
and managers could be incarcerated. Another consequence is the reputational
damage that an organisation could incur. It is very hard to restore trust in the
company among the community and stakeholders. We have seen some high-profile
cases where dishonest acts virtually destroyed companies. Having effective
governance in an organisation and properly implemented ethics policies helps
organisations to prevent these failures. Leaders and employees are held to task, kept
accountable and must live by the values of the organisation. These values include
being responsible, accountable, honest, having integrity, striving for excellence, and
treating others with fairness and as equals.
What are the benefits of having a good ethical culture?
A good ethical culture ensures that people get along. There is often better teamwork,
more tolerance and better communication, which leads to more transparency, honest
actions, feeling valued and appreciated, and being more respectful to one another.
This often improves service delivery and, quite often, profit. When things do go
wrong, occasionally, when there is an ethical culture, we can recover and be able to
protect our good name better.
If you want to build an ethical culture, ProEthics can assist you with ethics training, ethics
surveys, ethics investigations, implementation of ethics policies and frameworks and so on.
Okina can assist with setting up a social and ethics committee, relevant task teams, the
drafting of agendas, checklists, terms of reference, and committee administration. For more
information, you can contact ProEthics on www.proethics.co.za and Okina Company
Secretarial Services on www.okinacosec.co.za or email@example.com.
I hope that you are inspired to embrace and implement ethics in your organisation. Join us
next week for PART II of our blog on organisational ethics.