Solving the democratic crisis through leadership and integrity

Jack Welch College of Business & Technology - Sacred Heart University Luxembourg

28 Mar 2019

Solving the democratic crisis through leadership and integrity

“Leading with integrity is paramount to address the challenges society faces with financial crises, the political landscape, climate change, and societal movements led by younger generations.” – Eros Sharma, Adjunct Instructor of Leadership and Management, Jack Welch College of Business & Technology, Sacred Heart University, Luxembourg

We see corruption in politics and business on a near daily basis. Whether it’s embezzlement, bribery, or even legal forms of misconduct like lobbying, corruption has been part and parcel of human society for centuries.

In a world where public trust in official entities is sharply declining and corruption is increasing at a rate rapid enough to spark a democratic crisis, instilling integrity in future leaders and executives is vital.

This was the keynote topic at the Leading with Integrity Conference and Panel in Luxembourg on 13 March 2019.

Panel leader and key speaker Eros Sharma, from Sacred Heart University’s (SHU) Jack Welch College of Business & Technology, outlined the precursors of corruption and the steps needed to “break icecaps of corruption”. As the figurehead of SHU’s Leading and Influencing with Integrity MBA course, Sharma is certainly a respected authority in the subject.

Teaching future leaders to act with integrity

SHU’s MBA programme also uniquely instils leadership competencies in students through a combination of advanced business education and hands-on work experience opportunities with local and international firms.

The school helps its global student population “evolve into the leader[s] they want to become” through internship opportunities, international study trips, and part-time offerings, allowing working students to complete the course at their own pace.

Breaking corrupt habits

“It is easier to act corruptly if there are many other individuals who think it is fine to be corrupt.” – Our World in Data

This type of unethical groupthink can permeate entire organisations, Sharma acknowledges: “When we have examples of senior leaders exercising lack of integrity, this may have a direct impact on the behaviors and existence of the entire organization.”

How, then, do we prevent corrupt acts like bribery and embezzlement? How do we prepare politicians, CEOs, executives and entire corporations to act with integrity?

Expectations, rewards and consequences

According to the framework outlined in The Future of Trust and Integrity, a white paper published by the World Economic Forum, the first step in solving the corruption crisis is to establish clear expectations regarding conduct.

These expectations – coupled with anti-corruption legislation and corporate liability tools, such as regulatory bodies – must be implemented at all levels of higher education and industry.

The second, and perhaps most important, step is to reward those who lead with integrity to inspire trust:

“Anti-corruption initiatives need to transition away from “naming and shaming” models and begin to celebrate and support honest government officials through “naming and faming”. This creates a system in which role models can inspire a new generation and form the basis of a network to push accountability from the ground up.”

That doesn’t mean that unethical behaviours should go unpunished. Indeed, if anti-corruption legislation is unenforced, trust in the system will diminish and imbue corrupt leaders with a sense of impunity.

This leads to the third step, which involves utilising collective action to establish liability mechanisms within the corporation. This will essentially revert dishonest groupthink, preventing exploitation of loopholes and other misconduct.

In theory, the third step is simple: if all employees within a corporation firmly oppose corrupt practices and work together to create a level playing field, anyone who acts dishonestly will be ostracised.

Technology’s place in solving the democratic crisis

Blockchain, open data and analytics are effective technological tools for preventing corruption and providing greater transparency.

However, the World Economic Forum notes that, while open data is a useful tool for combating corruption, technology alone is insufficient for solving the crisis of democracy. In fact, these technologies are, by nature, vulnerable to cyber attacks and data leaks.

Despite that, open data, when combined with trust-building activities, can restore trust in organisations affected by corruption.

Unfortunately, it’s a problem that continues to grow. In 2018, more than 60 percent of the world’s nations scored less than 50 on the Corruption Perceptions Index:

“[This] reveals that the continued failure of most countries to significantly control corruption is contributing to a crisis in democracy around the world.”

Corruption often feels so commonplace in our society that it’s affecting our overall trust in government, business and media. The 2018 Edelman Trust Barometer found that the USA’s ranking fell 23 points from the ‘Truster’ category into the ‘Distruster’ category.

There is some good news, though: today’s CEOs are increasingly held to a higher ethical standard than those in the past. And when they engage in corrupt behaviors, they’re forced to face the consequences; the number of CEOs dismissed for unethical business practices increased by 36 percent from 2007 to 2016.

Click here to learn more about how this AACSB-accredited business school places integrity, character and empathy at the forefront of its educational philosophy.

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