iGate’s Failures in Risk Management

iGate fired its CEO Phaneesh Murthy for sexual misconduct after Araceli Roiz; an American employee accused him of sexual harassment. As per media reports she has claimed that the relationship started soon after she joined the organization in 2010 and is pregnant with his child.

Mr Phaneesh Murthy has the dubious honor of facing two similar charges while working as a senior manager in Infosys in 2002. Reka Maximovitch and Jennifer Griffith had both received huge out of court settlements previously. Now he faces the similar charges from Araceli Roiz. Mr Murthy has acknowledged that he had sexual relationships with Ms Roiz. However, it was with her consent. He has alleged he is being defamed and this is an attempt at extortion.

With the limited information available in the media, one cannot comment on the details of the personal relationship.

However, this disaster teaches a few lessons. iGate could have prevented this reputation damage and legal risks if it would have taken a few timely steps.  iGate board and senior managers failed to take due care of the following risks.

1.     Pre-employment Background Screening

Mr Murthy has an excellent academic and professional achievement record. He was credited for taking Infosys turnover from $ 2 million to $ 700 million. However, when he was hired by iGate in 2003 he was in the news for all the wrong reasons. The sexual harassment cases were all over the media.

iGate needed a CEO who could deliver results. My guess is the board looked the other way or considered Mr Murthy’s infidelities small or insignificant. However, if a junior or middle manager had the same reputation, his career would have been over. No organization would have hired him.

Hence, when generally senior managers background screening is more stringent  than junior or middle managers, iGate board took the opposite stance.  It appears that the same yardstick isn’t being applied for background screening or it is being given lip service.

2.     Failure to Monitor & Control CEO Behavioural Risks

iGate board and senior managers chose to ignore the CEO behavior  As per media reports, the relationship was known to the staff. However, it appears no action was taken to guide or coach Mr Murthy.

Read these statements of Mr Murthy from prior interviews at the time of Patni takeover.

The National – “Everyone says that M&As are about ego. I’ve been a salesperson for 10 years. For every 100 doors that you knock on, 98 get shut in your face. That has knocked away most of my ego. I have two teenage boys who whip my butt in every game. They have gone from wanting to be on my team to not wanting to be on the loser’s team. Because of that, I have no ego left.”

Livemint – “Not at all. I am basically a conservative, middle-class south Indian Brahmin. As it is, we don’t like debt, and I am very uncomfortable with a $700 million (around Rs 3,180 crore) debt.”

Ms Araceli Roiz is 31 years old and Mr Phaneesh Murthy is 53 years old. In conservative South-Indian Brahmin families “divorce” is taboo. With two teen aged boys at home, he started an affair, if Mr Roiz version is true, when she was in her late twenties.

From a psychological perspective, it is a classic case of a talented man unable to deal with his own fallibility and mortality. Mr Murthy is a competitive man and the yearly success in his career may have made him feel invincible and powerful.  He is raised on Indian middle class values that look down on promiscuous behavior  He competes with his own children in games. He was heading an Indian IT organization where the average age of employees is 25-26 years. Does it look like he was suffering from mid-life crises?

The board members and other senior managers could have identified the emotional baggage he was carrying around and addressed the issue. The question arises, when the board knew about his weakness and character problem, was he provided any coaching or mentoring? Or did the board take the view, that as long as he is delivering the numbers, everything will be tolerated.

3.     Lack of attention to work culture

The board and management knew that Mr Murthy had a marked reputation in respect to female employees. Secondly, it appears that is relationship with Ms Roiz was an open secret. From his own words, it doesn’t seem that he took sexual harassment or company policies seriously. In the interview, he stated:

“It was a personal relationship. The company policy states that any two employees having a relationship have to inform the superiors. It is a small note in an employee handbook. I did inform the company about the relationship. Though it was a question of timing from my side as I disclosed this only a few weeks ago, only after the relationship was over.”

According to him, “it is a small note” in the company handbook.  He didn’t believe in walking the talk in personal ethics or corporate code of conduct. Hence, the question arises, what attention iGate paid to maintain the corporate culture.

With previous cases of sexual harassment against the CEO and an on-going affair, did iGate management ensure that the sexual harassment policies were implemented in spirit? If a woman, as per Roiz’s claim, was forced into a sexual relationship by the CEO, what effect did it have on other female employees and work culture? Did it not set the stage for the hostile work culture where women would feel insecure to report cases of sexual harassment? Let us say, another female employee was harassed by a male senior manager, what options does she have when she knows that the CEO is doing something similar? How seriously was sexually offensive behavior taken by the management?

 The organizations pay a heavy price in respect to sexually harassing culture. The direct costs are of course legal penalties and cases, however, the indirect costs are absenteeism, disengagement, high turnover and lower productivity. The iGate management appears to have ignored these aspects while hiring Mr Murthy and during his tenure.

4.     Ineffective Crises Management

iGate public relations team issued the statement – “The investigation, which is on-going, has reached the finding that Murthy’s failure to report this relationship violated iGATE’s policy, as well as Murthy’s employment contract. The investigation has not uncovered any violation of iGATE’s harassment policy.”

It gave information on the interim CEO and search for the new CEO, to rest fears of the investors.

This appears more of an attempt to limit legal risks. According to US laws the company is responsible for sexual misconduct by its employees. Subsequent to the above news, the company has not made any statement or explanation on what it did to prevent such incidents.

According to media reports, the Indian employees received an explanation from the senior managers on the incident and were instructed not to talk to people outside and within the organization. An instruction not to communicate with the media or put comments in social media is sound. However, not to communicate with fellow employees sounds like an attempt to silence. Can management stop the discussion outside office hours between the employees?

In such instances, various stakeholder expectations need to be addressed. It is a sensitive issue that gets the attention of public, bloggers, activists, women lobbies etc. Even the employees psychological stress levels increase and they need to be managed. However, from the information available in the media, there isn’t much effort being done to manage the crises.

Closing Thoughts

Sexual harassment cases cause huge reputation damage and legal risks. I am not sure whether after Mr Murthy’s previous cases, iGate got proper insurance coverage for directors and senior manager liabilities. Implementing sexual harassment policies and holding everyone to high standards of conduct is something organizations need to concentrate on. The issue was taken lightly previously, but now women workforce is increasing and so are the cases of harassment. Unless companies wish to have their name tarnished, they need to take the right steps.

References:

1. Read more: http://www.thenational.ae/business/technology/rise-and-fall-and-rise-again-of-it-star-phaneesh-murthy#ixzz2UBKIGikk
2. http://www.financialexpress.com/news/phaneesh-murthy-i-will-fight-sexual-harassment-charges-vigorously/1118857/1
3. http://timesofindia.indiatimes.com/tech/careers/job-trends/Murthy-scandal-iGate-staff-gets-social-media-code/articleshow/20222185.cms

Risk Managers – Tone Down That Report!

This week three renowned figures – Angelina Jolie, Larry Page and Christine Quinn – disclosed their medical problems to the world. They discussed battle with breast cancer, paralysis of vocal cords, and struggles with bulimia and alcoholism. Jolie, a woman famous for her beauty bared her mastectomy details. They talked about fear of death and handicap, and frailty of human character. They risked high-profile careers by being candid. One word describes their actions – Courage.

However, the corporate world wants to hide behind lies and window dress their weaknesses. The corporate leaders sometimes threaten risk managers and auditors to tone down their reports. The messengers of bad news get shot. Risk managers face bullying, retaliation and threat to their jobs for showing courage to speak the truth. If they refuse to bow down to pressure, the business teams label them as politically dumb or difficult to deal with. Question is – should risk managers tone down their reports to please the business teams?

I want to discuss a couple of scenarios here and you decide the course of action.

Scenario 1- Don’t report correct facts to avoid giving bad news

Let us say, you are a CXO of an organization. You have a heart problem and visit a doctor who is a good friend of yours.

The doctor realizes your heart condition is bad. You require a heart surgery for four bypasses. The doctor doesn’t want to deliver the bad news to you, because he doesn’t wish to hurt your feelings.

The doctor tells you  – “You just have too much stress. You need a vacation to relax and have some fun.” He prescribes you some vitamins and discharges you.

You follow your doctor’s advice, take a vacation. You swim and jog for a couple of days and have a heart attack. You arrive at the hospital with a survival chance of 5%.

Did the doctor do the right thing by not telling you the truth?

Scenario 2 : Don’t report correctly to protect a friend

A civil engineer responsible for doing quality and inspection checks of a bridge notices that sub-standard quality of material is used. There is a high risk of bridge collapsing. However, he issues a clean report to his seniors because the engineer-in-charge of the bridge is a friend of his.

An organisation’s senior managers drive daily across the bridge to reach their office. One day all of them are on the bridge and it collapses. All die.

Would the families of the senior managers be happy with the quality control engineer’s for not disclosing the risks?

My guess is most of the corporate readers would have answered no. You would have preferred the truth when it is a question of your own life being at risk.

Corporate Scenario

So why don’t corporate citizens hesitate when they put other people’s life at risk. See the Bangladesh factory fire, Japan’s nuclear disaster or US banks home foreclosure and mortgage mess. Employees, customers and public lives or life savings were put at risk.

Wouldn’t a few honest risk management reports helped in fixing the problem in time to prevent the disasters?

The corporate world maintains double standards on reporting risks. They want full disclosure of the risks to them but not to others. Before setting these expectations, corporate citizens should answer these questions:

1) Isn’t it a risk manager’s job to identify the health problems of the organization, prescribe a cure, suggest amputation where required and nurse the organization back to health?

2) Is it right to compromise professional ethics and code of conduct to keep a few people happy?

3) Aren’t risk managers responsible for calculating the direct and indirect cost to others for non-disclosure of risks?

4) Shouldn’t risk managers hold their ground and stick to their independent advise as you will benefit from it in the long-run?

Closing Thoughts

Moral courage is one of the most difficult qualities to acquire. Larry Page, as CEO of Google fulfilled his responsibility to the investors by publicly disclosing his medical problems. Now the investors can make an informed decision. One has to admire Page for taking such a difficult call. It takes guts. Disclosing personal weakness makes one feel vulnerable, exposed and fallible. He has shown the path for corporate leaders to follow.

Justin Bieber’s Lesson For Risk Managers

Surfing through Twitter one gets deep insight of human behavior. I am sharing a couple of tweets that got me thinking on our (risk managers) approach. The hat tip goes to Justin Bieber and Mark Robinson for the post.

 1. Get a tribe

 Justin Bieber tweeted the message below and it got 119,562 retweets and 62,959 favorites at the last count.

“Live life full”

— Justin Bieber (@justinbieber) May 10, 2013

Now you might say, what is so original in this message. Nothing remarkable, except that Bieber has 39,087,920 followers.

The message for risk managers is that if we want business team to listen to us, then we need to get a tribe of followers. Sitting in a corner or a cabin, writing reports isn’t going to help us. We need to be on the floor  interacting with the business teams daily.

2. Connect with a popular leader

Then Mark Robinson tweeted this message:

“Justin Bieber got 100,000 retweets for tweeting “Live life full”. That’s just 3 random words. I’m going to try now.

Nipple squirrel ham”

— Mark Robinson (@robboma3) May 11, 2013

The message was retweeted 26,972 times and favorited 4379 times. Mark has 23,694 followers. While Bieber’s message was tweeted by just 0.3% of his followers, Mark’s message was tweeted more than the number of his followers. Isn’t that fascinating.

This is a trick which risk managers need to learn. Even the most mundane message of a popular leader will be followed more ardently than their sanest advise. People don’t follow bosses, they follow leaders whom they like. Hence, risk managers need to identify the popular figures in office, ask them to give their message or link up their own version to the popular person’s message. Risk management advise is going to spread faster then, rather than with all the technical stuff.

I am dedicating Justin’s song to all of you. We need to believe it too – “I got that power”.

Leadership of Dead Bodies, Stones and Flowers

In April, two Air India pilots handed over the controls in auto-pilot mode to two female cabin attendants to take a short nap. They decided that their sleep was more important at 33,000 feet while flying the 160-passenger flight from Bangkok to Delhi. They returned to the cockpit after 40 minutes when one of the cabin attendants accidently knocked off the auto-pilot mode.

The angry Twitterate asked for pilot’s license suspension, removal from job and legal charges for culpable homicide. Everyone questioned their work ethics and shock at their irresponsible behavior. Air India investigated the incident, suspended the pilots and sated that passengers’ safety was never compromised. Unbelievable, how can passengers be safe without any pilots at the helm?

1.     Double Standards in Evaluating Corporate Leaders

 The pilots were crucified for risking the lives of passengers. However, surprisingly the pilots of the corporate world do not suffer the same fate. The wizards and titans of the banking industry crash landed the world economy, but they didn’t lose their CXO seats.

Look from another lens. Did any senior in Supplier Company or the multinationals lose their job in the Bangladesh factory fire? In Foxconn, the Apple contractor, 11 employees committed suicide, four died in an accident and one collapsed after continuously working for 36 hours. However, Steve Jobs was rated as the second most popular leader by the CEOs in a survey conducted by Price Waterhouse Coopers. The first and third were Winston Churchill and Mahatma Gandhi respectively.

Now this is going to rattle my readers but let me say it. Steve Jobs was a great inventor, designer, strategist and marketer. However, when it came to people, his employees considered him rude and manipulative, and his competitors found him uncivil. Though Apple achieved great heights, he paid low salaries to the employees in the Apple stores, paid no dividends to the shareholders, pushed down suppliers to manufacture at lowest possible rate and didn’t believe in charity or corporate social responsibility. His behavior and actions weren’t people centric or humanity oriented. So my question is – do we consider him a great leader because he managed to put Apple on top? That makes him a great CEO, not necessarily a great leader.

2.     Misconceptions of Leadership

 The problem arises due to the definition of leadership. Read the dictionary meaning:

Leadership is “organizing a group of people to achieve a common goal”.

- We don’t focus on how the group of people were gathered; by inspiring them or arm-twisting them.

-  We don’t focus on the nobility of the goal; was it to exploit others or liberate them.

-  We don’t focus on the method adopted to achieve the goal; was it by breaking the rules or a journey of virtue.

In the present world we see leaders leaving dead bodies in their path, walking over people as if they were stones and sucking the life out of them. Great leaders create leaders not followers, they make others blossom like flowers.

Be it a corporate leader or political leader, we don’t wish to question the leadership methods. Our thinking is, how it matters to us, we have nothing to lose. We have everything to lose, and Martin-Niemöller-Foundation words at Hitler’s time still resonate:  

“First they came for the communists,
and I didn’t speak out because I wasn’t a communist.

Then they came for the socialists,
and I didn’t speak out because I wasn’t a socialist.

Then they came for the trade unionists,
and I didn’t speak out because I wasn’t a trade unionist.

Then they came for me,
and there was no one left to speak for me.”

Our own silence will kill us and the society we live in. When humanity is at stake, can we close our eyes and say nothing is at stake.

3.     Leadership Training

The Institute of Strategic Change reported that – “the stock price of ‘well-led‘ companies grew by over 900% over 10 years, compared with 74% for poorly led companies”. Warren Bennis in 1998 said – “The Truth is that no one factor makes a company admirable. But if you were forced to pick the one that makes the most difference, you’d pick leadership.” However, how many companies train on leadership or do a performance evaluation on leadership qualities?

Quite a few would be saying we do it. So let me clarify. In organizations bosses tell the juniors what to do and how to do it. They give rave reviews to the employee who completes the task as they had stated. They promote that employee and now he becomes a boss. At best, he will be a good manager, not a leader.

Corporate world determines success rate by title and salary.  Neither guarantees leadership skills. Employees aim to become a boss, not a leader. The terms are not synonyms.

According to Malcolm Gladwell,  all outliers practiced their talent for over 10,000 hours to achieve greatness.  In the corporate world, how many hours are dedicated by each employee to learn leadership? Learning leadership is a by-product of the main job, till CEO level. Then isn’t it surprising that we do not have many great leaders in the corporate world.

 Closing Thoughts

Maximum damage in the world was caused by people who got powerful positions without good leadership qualities, be it Hitler, Jeff Skilling, Bernie Madoff or Lance Armstrong. The biggest risks in the corporate world are leadership risks. It is the leaders who make the decisions, so unless we have a system of putting the right people in leadership positions we will continue to have these disasters. Hence, our job is to develop good leaders, select good leaders and continuously monitor the leaders.

 Wishing my readers a Happy Mother’s Day. Being parents is the toughest job in the world,. They are responsible for raising the next generation of leaders.

References:

1. Air India Pilots Story  
2. Deaths in Foxconn
3. Price Waterhouse Coopers report on best leaders

 

Role of Positivity in Risk Management Communication

Can something as simple as appreciation make business teams more willing to accept a risk manager’s viewpoint?

———————————————————————————————–

The Conflict

Proverbially risk managers are locking horns with business managers. Of course business managers out number risk managers, hence more often than not risk managers are licking wounds and complaining that business managers don’t listen to them. Business managers claim that they are running the show, so an interfering risk manager who is perpetually criticizing their hard work  should be shown the door.

Then risk manages lament that it is their job to high light risks which means negatives, so why go after them for being messengers of bad news. The conflict brews and sometimes reaches boiling point. No one wishes to see eye to eye because they wish to get eye for an eye. End result, the business suffers in this battle.

What is the cause of the stormy relationship? Criticism and negative feedback! No one likes it, so why blame the business managers.

What if risk managers change the approach? With the criticism they give a lot of positive reinforcement? Will the behavior of business managers change?

Research on Role of Positivity in Performance

Marcial Losada and Emily Heaphy conducted a research titled – “The Role of Positivity and Connectivity in the Performance of Business Teams – A Nonlinear Dynamics Model”. They studied the dynamics of team interaction in relation to approving and disapproving verbal feedback statements. Researchers coded the verbal communication among team members along three bipolar dimensions, positivity/negativity, inquiry/advocacy, and other/self. Sixty teams developing annual business strategy were analysed.

The results of the study have extremely important implications  from business performance aspect and for risk managers. The table below defines the ratios of various dimensions.

The positivity/ negativity ratios indicate that high performing teams give 5.6 positive comments to 1 negative comment. In contrast the low performing team give three negative comments to one positive comment. The medium performing teams give approximately two positive comments to one negative comment.

Similarly, under inquiry/advocacy ratios, the high performance teams are more balanced in their approach towards inquiry and advocacy. The team members question in an exploratory way. On the other hand, low performance teams are highly unbalanced and members advocate their own viewpoint. The medium performance teams are little bit tilted in favor of advocacy.

Again, high performance maintained a balance in discussing internal and external aspects. Whereas, low performance teams focus on internal inquiry. The medium performance are slightly more focused on internal than external aspects.

Thus, the high performance team have higher levels of connectivity, which results in better performance.

Overall, high performing teams show buoyancy throughout the meeting. They appreciate, compliment and encourage their team members. This expands the emotional space for team to function. In contrast, in low performance teams sarcasm and cynicism rules which restricts the emotional space. There is lack of mutual support, enthusiasm and a high degree of distrust.  The medium performance team don’t show distrust or cynicism but neither are they openly supportive and enthusiastic about their team members.

Implications for Risk Managers

The results are very important from a risk manager’s perspective. As the author states – “to do powerful inquiry, we need to put ourselves sympathetically in the place of the person to whom we are asking the question. There has to be as much interest in the question we are asking as in the answer we are receiving. If not, inquiry can be motivated by a desire to show off or to embarrass the other person, in which case it will not create a nexus with that team member.”

Hence, from the time we approach the business team, we need to ensure that we are inquiring about the business. We should not be advocating any quick recommendations based on high-level interactions.

Another point to note is that the questions should cover both the internal and external environment of the business. This would motivate the business team into a more open discussion.

The most important point is about positive feedback. In our verbal communication and written reports we focus on highlighting the negatives.

The research showed that positive comments (that is a terrific idea) create emotional space within the listener, hence the listener is more willing to take the feedback. The emotional space created by positive comments in high performing teams is twice the size of medium performing teams and three times that of low performing teams.

Negative reporting restricts the emotional space of the business team. To build a positive environment for acceptance of our views, recommendations and report, we need to give 6 positive comments for each negative comment.

The researchers have given equations to assess the emotional space based on various dimensions. It might be a good idea to calculate the same before issuing a report.

Closing thoughts

One of the incorrect assumptions that risk managers make is that there is a linear relationship between the observations and recommendations in the report. However, the study showed the impact of non-linear relationships on functioning of teams. Hence, the fault may lie in the straight forward cause and effect attitude taken by risk managers to get buy-in from business managers.

We generally discuss that in reports we should highlight the positives first to balance out the negatives. This research clearly points out the importance of doing so and the reasons why we are failing. We have to change our approach to be effective. We need to be part of the business team, develop a positive feedback system before giving any negative observations

References:

The Role of Positivity and Connectivity in the Performance of Business Teams: A Nonlinear Dynamics Model - Marcial Losada and Emily Heaphy

Indian Attitude Towards Time – A Strength In Future

We Indians jokingly refer arriving late for a meeting as arriving ISD (Indian Standard Time). However, if you, my reader, are an Indian, you would have heard a question from a western colleague – “Why are Indians late for meetings?” If you are a westerner, you desperately want to know the answer to bring your stress down and figure out whether the Indians actually want to do business with you. However, whether you are an Indian or a westerner, have you ever thought of Indian attitude to time as a strength in the future chaotic world?

Let me delve into a little bit of detail before I answer that. The attitude towards time divides people into two cultures – monochronic people and polychronic people. According to Wikipedia the definitions are:

Monochronic – A monochronic time system, people do things one at a time and segment time into precise, small units. Under this system, time is scheduled, arranged and managed.

Polychronic – In polychronic time system, people do several things simultaneously, and take a more fluid approach to scheduling time.

Indians follow the polychronic time system whereas most of the western countries believe in monochronic time systems. The general perception is that people following monochronic time system are better organized. Hence, monochronic system is superior.

1. Attributes of the two cultures

Below is a table of attributes the people of two cultures show with the current business buzzwords and applicability to Indians. Check it out and tell me whether Indians attitude towards time is going to be strength in future?

No	Monochronic People	Polychronic People	Buzzwords	Applicability to Indians
1	Do one thing at a time	Do many things at once	Single task v/s Multitasking	Multitasking
2	Concentrate on the job	Can be easily distracted and manage interruptions well	Single task v/s Multitasking	Multitasking
3	Take time commitments seriously	Consider an objective to be achieved, if possible	Task oriented v/s goal oriented	Goal oriented
4	Are low context and need information	Are high context and already have information	Direct orders V/s Subtle communication	Subtle communication
5	Are committed to the job	Are committed to people and human relationships	Task oriented v/s people oriented,	People oriented
6	Adhere religiously to plans	Change plans often and easily	Predicted & scheduled v/s Chaotic & complex(Fixed project schedules v/s Flexible planning)	Chaotic & complex
7	Are concerned about not disturbing others; follow rules of privacy and consideration	Are more concerned with those who are closely related than privacy	Individual V/s social communities(Privacy and security v/s social networks and internet)	Social communities
8	Show great respect for private property; seldom borrow or lend	Borrow and lend things often and easily	Ownership v/s credit lending	Credit lending
9	Emphasize promptness	Base promptness on the relationship	Time v/s relationship	Relationship
10	Are accustomed to short-term relationships	Have strong tendency to build lifetime relationships	Transactional relationships v/s Long-term relationships	Long-tern relationship

2. Link with current management trends

Now let us discuss the latest management mantras:

a)    Impact of  technology

Advancement in technology and telecommunications has globally connected the world with little segregation possible in work and home life. Managers do multiple tasks now and Gen Y are mentally geared to do so from childhood.

Advantage – India: Indians traditionally do multiple tasks and have a huge population of Gen Y.

b)    Effect of  globalization

Globalization and outsourcing has ensured that managers are not physically available on site to monitor tasks. Secondly, work-life balance is encouraging more people to work from home. Hence, success depends on delivering results and not on completing tasks.

Advantage – India: Indians do not have mindset for process adherence and adopt flexible approaches to achieve targets.

3)    Influence of social networking

In the age of social networking, communication is taking center stage.  Senior managers face the challenge of communicating with a global workforce of different cultures.

Advantage - India: Indian communication style is subtle, layered and non-aggressive.

4)    Demands due to complexity of business 

The space of change in the world has increased due to technology and globalization. The business environment has become complex and chaotic. The long-term planning is not possible because parameters change in a short time.

Advantage – India: Indians managers are used to dealing with adversity and chaos. They are comfortable working delivering results with minimum infrastructure and support.

5)    Finding meaning in relationships

The western organizations have realized that in the long run transactional relationships result in dysfunctional organization culture and reduce customer loyalty.

Advantage – India: Indians believe in long-term relationships even in business. They conduct business after establishing trust and respect in the relationship.

Closing thoughts

I do not know whether I am on the right track. Nevertheless, in my opinion we definitely need to relook, as the risks are high. For instance, presently the western organizations are developing their organization structure, processes and framework according to monochronic thinking. On the other hand, as the business environment requires polychronic behaviour, there is going to be clash in the system. Employees will be confused and unnecessary conflicts will occur. That results only in one thing – lower profits and higher risks.

In Indian organizations, we need to be clear that we do not adopt behavior patterns and change the culture according to our perceptions. We need data and analysis to assess the culture that will be suitable in future. It is possible, that a polychronic culture is better.

Justice Verma’s Report – A Respite for Indian Women

Justice Verma’s report besides covering sexual harassment at workplace also covers other crimes committed on women. Most of these questions were never raised or those who raised them were unheard. Nevertheless, for a civilized democratic nation, the existing social attitudes need to be challenged. India cannot become a global super power when it is the fourth unsafe country in the world for women, nearly 50% of its population. It is our duty to question existing archetypes, advocate change and bring about new thinking.

India was among the few countries that gave equal rights to women on Independence in its Constitution. Mahatma Gandhi thoughts reflected his open thinking in the following words. Let us make them a reality in this century.

“Woman is the companion of man, gifted with equal mental capacities. She has the right to participate in the minutest details in the activities of man, and she has an equal right of freedom and liberty with him. She is entitled to a supreme place in her own sphere of activity as man is in his. This ought to be the natural condition of things and not as a result only of learning to read and write. By sheer force of a vicious custom, even the most ignorant and worthless men have been enjoying a superiority over woman which they do not deserve and ought not to have. Many of our movements stop half way because of the condition of our women.”

The issue is at the heart of Indian society and below are few points from the report that I wish to bring to your attention.

1.     Rape and Sexual Assault

The Indian Penal Code defines rape as:

“A man is said to commit “rape” who, except in the case hereinafter excepted, has sexual intercourse with a woman under circumstances falling under any of the six following descriptions:—

First.—Against her will.

Secondly.—Without her consent.

Thirdly.—With her consent, when her consent has been obtained by putting her or any person in whom she is interested in fear of death or of hurt.

Fourthly.—With her consent, when the man knows that he is not her husband, and that her consent is given because she believes that he is another man to whom she is or believes herself to be lawfully married.

Fifthly.—With her consent, when, at the time of giving such consent, by reason of unsoundness of mind or intoxication or the administration by him personally or through another of any stupefying or unwholesome substance, she is unable to understand the nature and consequences of that to which she gives consent.

Sixth.—With or without her consent, when she is under sixteen years of age.”

In Indian society, few women are able to exercise their right to object or say no. Men obtain consent through psychological, emotional, financial and physical coercion and threat. The popular concept is that rich men do not rape, it is only poor men who rape women. If a rich man obtains consent through coercion, the women agreed. The standard should be clear. Any man who forces himself on a woman when she has said no is attempting rape. Sex with a woman when she is opposing or resisting is rape. Consent given out of fear or criminal intimidation is rape. Period.

The situation of an Indian wife is the worst possible in the world. Every woman in the world has a right to say no, except an Indian wife. She is duty bound to have sex with her husband. For the first time Justice Verma has included marital rape. Wife is not a property of the husband and has the right to revoke her consent to sex during the course of her marriage. The report states- “A rapist remains a rapist irrespective of the relationship with the victim.” In mordern context, marriage is a relationship of equals and consent cannot be assumed as implied.

Secondly, rape victims face extreme humiliation in courts when their past personal life is dragged for discussion. The defense lawyers ruin the reputation of the victim by bringing past love affairs. In Indian society, if a woman has sex outside of her marriage she becomes characterless. The whole attitude adds insult to injury. Justice Verma has recommended that a woman’s past life cannot be a subject matter for debate in court in a rape case.

It requires extreme courage in India for a woman to report rape and most of the cases go unreported due to the social stigma a raped woman faces. She is ostracized and alienated by the society and her reputation is ruined. The abusive men proudly boast about their power and accomplishments in brow beating women into submission. This attitude needs complete revamping as it distorts the justice system. Society should view rape as a crime and not evaluate it on a shame-honor paradigm as it puts the victimized woman on trial instead of the rapist.

Sohaila Abdulali, a rape victim had succinctly put it – “Rape is horrible. But it is not horrible for all the reasons that have been drilled into the heads of Indian women. It is horrible because you are violated, you are scared, someone else takes control of your body and hurts you in the most intimate way. It is not horrible because you lose your “virtue.” It is not horrible because your father and your brother are dishonored. I reject the notion that my virtue is located in my vagina, just as I reject the notion that men’s brains are in their genitals.” This brave heart has the courage to break the rigid thinking and fight against atrocities.

2.     Eve Teasing and Stalking

The Indian Journal of Criminology and Criminalistics (January- June 1995 Edn.) has categorized eve teasing into five heads viz. (1) verbal eve teasing; (2) physical eve teasing; (3) psychological harassment; (4) sexual harassment; and (5) harassment through some objects. In India the safety of women is at risk in all public places and not just the workplace. Women are sexually harassed in public spaces by men making unwarranted comments. In some cases, the obscene words and gestures seriously impact the dignity of women.

A minor girl in India from the time of achieving puberty becomes a target of eve teasing. As India is a conservative society, she learns to suffer the indignities quietly. As such with the parental attitude that girls are a liability, Indian girls have a low self-esteem. They are trained to behave according to “what will people say”. Hence, the young unsure girl suffers psychologically and emotionally without an outlet since she cannot share her “shame”. If she does so, she will be shunned.

For men it is just an entertaining pastime to demonstrate their machismo. They generally go unpunished due to the lax implementation of criminal action in these cases. Women hardly report the cases to police though eve-teasing is a criminal offence

Justice Verma’s report gives recommendations to curtail eve-teasing. He has suggested  deputation of female police officers at public places, installation of CCTV cameras in public places, filing of police complaints by public transport and public place operators etc. These are steps in the right direction.

If a man wishes to talk to a woman, he can do so in a graceful and dignified manner without offending the sensibilities of the woman. He does not need to stalk a woman, behave in an uncouth and uncivilized manner to get attention. Moreover, if a woman has rejected his advances, he should accept that gracefully. His interest and her rejection do not give a right to harass and abuse her. The women should not adopt a defeatist attitude or try to convince themselves that the man is showing affection and liking. He is blatantly saying that he does not respect you or your wishes. Thankfully, Justice Verma’s report has included stalking as a criminal offense.

Closing Thoughts

Courage is not the absence of fear. Courage is about fighting fear tooth and nail in every step we take to define a new path. The educated women and men of India need to fight this battle for their less privileged counterparts. When Indian women could fight shoulder to shoulder in the non-violent struggle for Indian Independence, they can fight now too. In life, always the crazies have brought about change. Don’t be scared to be marked as quirky or non-conformist, you are in good company. Before Independence, British thought Mahatma Gandhi as a fruitcake. The point is, no one will fight your battle for you. We need to do it for ourselves. Progress of Indian women serves India’s national interest. Hence, let us move forward with courage and conviction to redefine the status of women in Indian society

References:

Report of the Committee on Amendments to Criminal Law – Justice Verma,

Justice Verma’s Report – Views on Sexual Harassment at Workplace

Justice Verma’s report covers sexual harassment at the workplace. While in September Lok Sabha cleared the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Bill, 2012, it is pending with the Rajya Sabha. The Supreme Court ruling of the Vishakha case in 1998 hasn’t improved the condition of women in the workplace. It looks like things are finally changing for the better with Justice Verma’s report as he covers some critical issues about the topic. Here is a brief overview of the issues Indian working women face and the relevant aspects of the act. The Indian organizations will now have to address these human resource risks properly.

1.     Background  

The Indian Constitution grants equal rights to women. It states that women have the fundamental rights to life with human dignity, to equality, and to work in ones chosen profession or trade inherently include protection from sexual harassment. Article 42 emphasis that – “The State shall make provision for securing just and humane conditions of work and for maternity relief”. The Constitution guarantees certain fundamental freedom to women as it considers that as a bedrock for democracy. However, Indian society even after over 60 years of independence considers women a subservient gender. Sexual harassment is rampant in society including the workplace.

Finally, the 2012 Sexual Harassment Act will provide some protection to women. According to the act, sexual harassment constitutes of the following unwelcome acts or behavior (whether directly or by implication) namely:

(i)              physical contact and advances; or

(ii)             a demand or request for sexual favors; or

(iii)            making sexually colored remarks; or

(iv)           showing pornography; or

(v)            any other unwelcome physical, verbal or non-verbal conduct of sexual nature.

Further on, the act states that the following circumstances, along other circumstances, if they occur or are in relation to or connected with any act or behavior of sexual harassment may amount to sexual harassment:-

(i)              implied or explicit promise of preferential treatment in her employment.

(ii)             implied or explicit threat of detrimental treatment in her employment

(iii)            implied or explicit threat about her present or future employment

(iv)           interferes with her work or creating an intimidating or offensive work environment for her; or

(v)            humiliating treatment likely to affect her health or safety

2.     Formation of Employment Tribunal

The act mentions formation of Internal Complaints Committee by the organization and a Local Complaints Committee at district or local level. The logic is that the employee should first address the complaint internally and if the employer is involved then the aggrieved women should approach the Local Complaints Committee. However, as we have seen in the ten years after the Vishaka case, these are not effective when senior managers are involved in sexual harassment. The woman generally loses her job if she files a complaint as the Internal Committee driven by Human Resource department supports the senior management.

Justice Verma report suggests formation of Employment Tribunal. He suggests that Internal Complaints Committee and Local Complaints Committee are not required as this process dissuades the women from complaining. I completely agree with Justice Verma. The senior managers will have lessor influence on external parties.

3.     Punishment on Filing False Complaint

The act states that if the Internal Committee or Local Committee determines that the allegation made by the woman was malicious or false, the woman can be punished for filing a false complaint

Justice Verma’s report recommends that a woman should not be punished for filing a false complaint.

Though, overall I am against the view of filing false cases and consider that these should be punishable. However, in case of sexual harassment, my view is that the women should not be punished. In all probability, there will be a few false cases filed by some crooked women. But in India due to society’s attitude, very few women have the courage to fight sexual harassment publicly  Secondly, if they file a case against senior managers, with the corruption level existing in the country, most cases can be made into false complaints. Hence, in these cases women should not be penalized if the case is proven false.

4.     Time Period for Filing Complaint

The act states that a woman should file the sexual harassment complaint within three months of the incident or the last incident.

Justice Verma states that there should be no time limit for filing the complaint.

I agree with Justice Verma’s suggestion. Indian women are geared to think that humiliating and sexually harassing behavior is acceptable. The kind of thinking is “men will be men”. Very few women have the courage to point blankly tell a man that sexually harassing behavior is unacceptable in civilized society. Hence, women generally file a complaint after repeated harassment. Problem further is intensified for married women, since the husbands tend to blame the wife for inappropriate behavior  There is a high-level social stigma attached to it, and sometimes marriage breaks up. Lastly, sexual harassers threaten a woman by spreading rumors and doing various acts to ruin her reputation. Hence, in Indian context there should not be a time limit for filing the complaint.

5.     Transfer of the Complainant

The act specifies that the Internal Committee or the Local Committee can transfer the aggrieved woman or grant leave to her.

Justice Verma’s report states that this should be done with the consent of the woman.

I agree with the logic of Justice Verma. Sometimes if a woman files a case in one city, she will be transferred to a remote place from where travelling expense will be significant or unaffordable. Hence, the woman will be unable to fight her case.

Moreover, sometimes she is forced to take leave and then rumours are spread. When she comes back, her job is given to another person. After waiting for a couple of months in the hostile climate, she automatically quits. Hence, in all these cases a woman’s consent should be mandatory before any action is taken

6.     Conciliation

The act states that the Internal Committee or the Local Committee at request of the aggrieved woman takes steps to settle the matter between her and the respondent through conciliation. The settlement so arrived should be recorded.

Justice Verma contends that conciliation is against the dignity of the woman and adds further to the humiliation. Hence, the section should be deleted.

In my view, the act states that conciliation process should start at the request of the woman. Hence, it is her practical choice and she should be allowed that. In Indian society, a woman may not have the means to continue a case for long and her reputation is perpetually at risk.

However, the act should specify the level and magnitude up to which conciliation should be attempted. If a woman is being threatened or the case is serious, she should be advised against conciliation and provided adequate protection from retaliation.

7.     Compensation and Employer Liability

The act states that an appropriate amount should be deducted from the salary and wages of the respondent and paid to the aggrieved women. If the employer is unable to deduct, for instance, the employee leaves the organization, and respondent fails to pay, the same will be forwarded to the District Officer.

In my view, the organization is liable for compensation as it failed to provide a secure and dignified working environment to the woman. Justice Verma has also mentioned that employer should be liable to pay for all losses incurred by the women due to sexual harassment.

The act only specifies a fine up to fifty thousand rupees is the employer fails to constitute an Internal Committee or contravenes any of the sections of the act. This amount is peanuts for large organizations and they shall blatantly ignore the act. Justice Verma has rightly recommended a prison sentence in case there is a systemic flaw and discrimination is encouraged. In India in some organizations, sexual harassment by senior managers is considered a right. They can choose any women and she is required to comply.

Closing Thoughts

Justice Verma has done a commendable job in highlighting the problems women face in Indian society and in giving solutions. For once, the report isn’t a white wash to cover some political agenda and shares strong opinions. We have to hope that the government takes the required steps with the same speed the report was issued. More than 25% women in India face sexual harassment at workplace and they have no effective redressal system to file their complaints. For a civilized democratic society, this is an unacceptable situation. The Indian organizations would find the rules tough to follow. However,  25-30% of employee strength constitutes of women. Hence, they must ensure secure and dignified working environment. Finally, after a woman lost her life in a gang rape, we are moving in the right direction. May her sacrifice be worth it.

Wish my Indian readers a Happy Republic Day. Especially the women, hope you get the freedom denied to you even after independence. 

 

References:

1. Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Bill, 2012
2. Report of the Committee on Amendments to Criminal Law – Justice Verma,

Barclays War on Culture Change

Barclays is again in the limelight due to a damaging report on the deviant culture existing in the Investment division. After LIBOR rate fixing scandal and quick departures of senior managers, trouble is again brewing in Barclays. The COO of Investment banking division, Andrew Tinney quit when it was discovered that he shredded the only copy of a report that clearly stated the bullying culture of the organization. Then the new CEO, Anthony Jenkins discovered when an internal whistle blower mentioned it to him. He sent out a message to staff on culture change. Here are some insights into the story.

1. The Damaging Report on Dysfunctional Culture

Daily Mail story states that the report prepared by Genesis Ventures - “paints a devastating picture of incompetence and arrogance at the bank, showing that executives:

• Pursued a ‘revenue at all costs’ strategy.
• Fostered a culture of fear and intimidation.
• Were ‘actively hostile’ to the idea of compliance with banking rules.
• Presided over a ‘broken culture’ where problems were ignored or buried.
• Allowed the business to spin ‘out of control.”

The senior management intentionally understaffed support functions, was hostile to compliance and attacked those who spoke contrary to senior management views. A senior manager threw the risk management report publically saying – “this is a piece of s***” showing utter contempt and disregard for the same.

The summarization of the report states – ‘The senior team portray themselves as all-powerful and all-knowing… and people chose to disagree with them at their own peril. It is a mentality of superiority which, when combined with other deficiencies, stops the team from tackling their blind spots. When those deficiencies are in compliance, this results in serious issues that no one else has the power to address.’

The bank’s culture has become completely deviant, and it will be a long road ahead for significant change to occur. The problem is that this issue is prevailing in other banks also. They depict the same culture and attitude. Unless we understand why it is occurring and senior managers take sincere steps, nothing positive will happen.

 2. The Psychological Explanation

Western banks are known for their arrogant and aggressive culture. Some view arrogance as a positive trait and humility as a negative trait, while the opposite is true. Stanley Silverman developed Workplace Arrogance Scale to measure arrogance level in the organizations. He stated the arrogant people demean others to prove superiority and competence. However, as per his results arrogant people showed lower intelligence and self-esteem in comparison to their peers. He identified four red flags to identify arrogant behaviour:

• Does your boss put his/her personal agenda ahead of the organization’s agenda?
• Does the boss discredit others’ ideas during meetings and often make them look bad?
• Does your boss reject constructive feedback?
• Does the boss exaggerate his/her superiority and make others feel inferior?

If you link back to the damaging report, the senior management at Barclays showed these traits in abundance. Even during the financial crises, the bankers didn’t feel apologetic and showed no humility. Now, being in such senior positions one cannot say they lack intelligence, however, questioning their self-esteem is definitely a valid path.

In another psychological study conducted by Angela Y. Lee, a professor of marketing at the Kellogg School of Management, it was determined that people with low self-esteem defend the brands more when their favourite brands are attacked. This explains why bankers refused to change and continued their behaviour when under attack during the financial crises.

3. The CEO Message for Culture Change

Deal Book reported that Anthony Jenkins, the CEO of Barclays sent a mail out to the staff with a clear message – “change or leave”. He categorically stated the values – Respect, Integrity, Service, Excellence and Stewardship – to be adopted by Barclays employees. He further added that those who do not change their behavior are free to leave. His words were – “My message to those people is simple: Barclays is not the place for you. The rules have changed. You won’t feel comfortable at Barclays and, to be frank, we won’t feel comfortable with you as colleagues.”

He highlighted that in the last two decades financial institutions pursued profits and compromised integrity and reputation of the organization. He said there is no choice between values and profits. Employees must pursue profits while maintaining values. Evaluation of ethical behaviour will be incorporated in performance appraisal process.

That is a very strong message from the CEO of the organization to transform the culture of the organization. Two questions in everyone’s minds are – will they succeed and how long will it take.

Closing thoughts

Bill Gates had famously said – “The world won’t care about your self-esteem. The world will expect you to accomplish something BEFORE you feel good about yourself.” Maybe organizations should care about the self-esteem of their employees and their senior management team. Studies have shown that people with higher self-esteem show more ethical behaviour and are less likely to get involved in wrongful acts. The present trend of pursuing material gains at the expense of personal values destroys self-esteem in the long run. Bankers have shown extreme tendencies to flaunt expensive toys to feel good and build a superior image. In all probability, they are caught in a catch-22 situation at a psychological level. It might not be possible to change the culture without addressing the core issues faced by the staff.

References:

1. Exposed: The regime of fear inside Barclays – and how the boss lied and shredded the evidence
2. Identifying the arrogant boss
3. Leave My Brand Alone – Kellogg School of Management
4. New Barclays Chief Tells Staff to Accept Changes or Leave

 

 

Development of Moral Authority and Responsibility

Mahatma Gandhi epitomizes moral authority in leadership. In every aspect of his life, when he witnessed injustice, he felt morally responsible to correct the situation. His following lines on the seven deadly sins effectively capture the root cause of the ills prevailing in the society in the 21^st century

Seven Deadly Sins

“Wealth without work
Pleasure without conscience
Science without humanity
Knowledge without character
Politics without principle
Commerce without morality
Worship without sacrifice.”

In the business sphere, the issues relating to financial crises, sexual harassment cases, oil spills, nuclear power station disasters, money laundering, bribes and corny capitalism – all arose because of the seven points.

It is not that moral responsibility has disappeared from Indian society. Anna Hazare’s fight against corruption, Arvind Kejriwal’s exposes and the candle light march for the Delhi gang rape victim, all show that leadership based on moral authority flourishes and forms the foundation of humanity.

The challenge is that the percentage of people showing moral responsibility is small. It is disheartening that India, a country thought as the heartland of spiritual awakening world over, is finding a shortfall in moral leadership. The difference between Gandhi and Hitler was only about conscience leadership. They both had vision, passion, communication and people management skills. Now we are seeing more leaders without a conscience.

So what changed over the centuries? If we see, a human body has physical quotient (PQ), intelligence quotient (IQ), emotional quotient (EQ) and spiritual quotient (SQ). In the 20^th century, the focus suddenly shifted to IQ and PQ. In the age of industrialization and development, people ignored EQ and SQ.

In the 18^th century, most of the literate people would have read their religious text. Though religion does not ensure ethical behaviour, it still lays down some parameters for virtues. In this century, just small percentages of literate people have read religious text and are capable of discussing the finer points. Therefore, the solution is to bring back focus on EQ and SQ. People with higher EQ and SQ are more ethical and morally responsible. Punishing people after they have conducted a crime isn’t the solution; we need to build the character.

The onus of responsibility rests with all the adults in the society. It may sound like a tall order, but there are a few things that each adult can do without much effort. Here are my three suggestions, share with me your ideas on the same.

1.     Use Gamification  

With technology, kids and adults are addicted to playing games on computers. It is unlikely, that kids now will sacrifice their computer to listen to grandma stories of old times. The stories had messages, which taught kids the difference between right and wrong. The schools had moral science classes, doing the same. In the current setup of nuclear families and education system, the kids lack it. Parents therefore can buy computer games dealing with ethical dilemmas, moral lessons and spiritual ideas instead of Angry Birds. It would be a step forward to see kids addicted to such games and not those showing violence and abuse.

Even in the business world, ethics can’t be taught in a day. If gamification is used to issue one ethical dilemma every day which staff participates in, the awareness level of the staff will be much higher.

2.     Take Speaking and Writing Engagements

Indians have vast access to knowledge on spirituality and ethics. The number of Indians speaking and writing about morals, ethics, spirituality etc. needs to increase. We can use blogs to give our messages, write in newspapers and journals, become guest lecturers in schools and colleges and take speaking engagements in business seminars.  The gap in EQ and SQ is huge. We need to build awareness by communicating the stories and building the skills.

Do the same in business environment. Have a business ethics blog on the intranet, make videos on ethical dilemmas and have classroom training on the same.

3.     Build Communities

In US there are huge number of societies and communities focused on addressing various problems. For instance, they have anti-bullying communities that propagate no bullying in schools. However, in India most of the societies are focused on religious aspects or charity. We need to build communities, whose members are brand ambassadors for personal and business morals. As we have seen from the past events, collective strength matters enough to force government and various authorities to take the right steps. We can then ensure better ethical education for the children and young adults.

In business too, it is easier to build an ethical culture when champions are appointed to propagate business ethics. Members of operation teams besides ethics officers are required to enhance the ethical values of the organization.

Closing thoughts

We have a choice, to ignore the ills of the society, complain about them or do our two bits to help improve it. From my experience, it is far more satisfying to contribute positively. Even guest lectures to college students on business ethics sow the seeds for morally conscious business. India has a huge Gen Y, and Gen X has to address this problem. Otherwise we will continue to see the increasing crime rate and see our own children become part of a racket.