“Conscience and Corporate Culture”

by Kenneth E Goodpaster (Blackwell 2008)

This book discovers a new disease and goes to great lengths to develop its antidote. “Teleopathy” is defined as “the unbalanced pursuit of purpose”. Its principal symptoms are fixation, rationalisation and detachment. Its mindset involves fixation on tangible goals or purposes without moderation; it tends to rationalise away any responsibilities or realities which may impede the accomplishment of the goals or purposes and separates those goals or purposes from the ethics of everyday life, leading to emotional detachment from the implications and consequences of those goals and purposes. Examples quoted are the two NASA space disasters, the Wall Street banker Martin Siegel and Andrew Fastow of Enron. The NASA disasters were due to key technical concerns about flight safety being over-ruled to meet political priorities. Martin Siegel fell under the spell of Ivan Bresley and gave him inside information. Andrew Fastow was mentored by Jeffrey Skilling and impelled to do anything to achieve power and riches. Teleopather – “telos” = end (Greek); “pathos” = suffering (Greek) is seen by Goodpaster as a medical condition the result of which, individually or in a group, leads to decisions which lack balance and ethical scrutiny. The context of the book implies that the events of 9/11/01 were driven by teleopathy; he might have cited Hitler’s “Last Solution” or the Spanish Inquisition but the whole book is US orientated.

Having defined “teleopathy” Goodpaster addresses “conscience”, defined as “inner awareness of right and wrong, good and evil” (Blackwell Encyclopedic Dictionary of Business Ethics”). Conscience is seen as a moral insight to counter teleopathy. Its basic yardstick is the “Golden Rule”, which can be traced back over 25 centuries, and in all religions to “treat others as you would be treated yourself”. From this point three polarities are developed – the “I” is extended to the “we” and then to include all others. “The Moral Agenda of Leadership” shows how the wider group can be motivated and how ethics can be taught. Three imperatives are explored – “orienting”, “institutionalising” and “sustaining”.

“Orienting” involves giving direction to the organisation, clarifying mission and values and giving motivation. The Caux Round Table principles of business behaviour serve as a model. “Institutionalising corporate conscience requires a balanced model to aid the process. Goodpaster explores the use of McKinsey’s “Seven S Framework” but reminds himself that McKinsey fostered the “star” system at Enron. He settles for a “Self Assessment and Improvement Process” to shape a framework. “Sustaining” Corporate Conscience involves both imparting the ethical values of the organisation to the next generation of leaders, and confirming those values to the economic and social environment outside the organisation. This involves “microfit” and “macrofit”.

Sustaining corporate conscience involves “Three academies”, modern business and professional schools, corporate development programmes and an association of business leaders to reinforce corporate ethical values. The first academy will require a significant adjustment to focus on ethics; the third academy does not yet exist, except in sketchy form (Caux Round Table, Aspen Institute, ISBEE and CEBC [both ethics bodies]).

This book is a “call to arms” for more rounded and altruistic business leadership. It is aimed at both educators and practising business executives. It is effective in challenging “teleopathy” in business, but success in its mission to change business ethics requires a whole societal approach to values, reinforcing families as well as organisations and bringing obligations into play to balance the excessive focus on rights which has undermined our humanity and opened the door to “teleopathy”.

Adrian Davies

7th May 2008