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Breeding A Culture Of Ethics And Good Governance In Business

Neil Cook is the CEO of the Fiji Roads Authority. This is his regular column which will be published by the Fiji Sun on Saturdays.   Innovation “Constantly thinking about
15 Aug 2015 08:34
Breeding A Culture Of Ethics And Good Governance In Business

Neil Cook is the CEO of the Fiji Roads Authority. This is his regular column which will be published by the Fiji Sun on Saturdays.

 

Innovation “Constantly thinking about how to do better” is one of Fiji Roads Authority’s core values.  Innovation is about challenging the norm.

In part, it is about challenging whether things are done for the purpose of a greater outcome and improvement or simply for the sake of ticking a box.

On the August 3, over 130 participants from the public and private sector attended a symposium on Legal Challenges, Good ethics and Governance in Public infrastructure Projects in the Building and Construction Industry.

The organising committee from SPEA and FRA, was led by a true stalwart of the Fiji Engineering Sector, Pratarp Singh.

It was kindly facilitated by Nazhat Shameem Khan and it was indeed empowering for all involved.

The need for more of this type of event is highlighted by the fact that as organisers even after almost doubling available spaces we still had to turn many people away because we were over-subscribed.

In light of the feedback I had on the day and afterwards, for this week I will share with you some of the observations and commentary I made in my opening address on that day.

 

Why was this forum so important for Fiji Roads Authority?

I believe that we need to develop here in Fiji an environment where various industries, the commercial sector, the professions take ownership of ourselves to advance best practice.

Much of best practice cannot be effectively regulated – it needs to be embraced by each of us individually, collectively as groups of professionals, within our companies, and as groupings of companies or agencies within a sector.

I say that best practice cannot be effectively regulated and I stand by that.

For Fiji, or any country, to develop an environment of good ethical conduct at all levels it needs to be done substantially in a self-policing way if it is to be sustainable in the long term.

Regulation is important in certain sectors and it is important in aspects of what all of us do – but it cannot, and never will, replace the collective effects of individuals of integrity holding each other to account.

Because as soon as we regulate we are setting an environment that requires monitoring, oversight and enforcement – and all of that takes resources – both in human terms and monetary terms.

 

Emphasis

The question that must be answered is whether the ‘ideal state’ the regulation is intended to produce warrants the resources applied to produce it.

In many instances that will not be the case.

My personal opinion is that there is too much resource put into ‘monitoring’ that is not particularly effective and doesn’t add a great deal of value.

If processes are in place that do nothing to advance Fiji as a nation what purpose are they serving?

Too often the process of oversight can become an end in itself – the reason for the process being put in place long forgotten. So we end up with people filling out check sheets – ticking boxes.

This is not a criticism of those individuals and is not to be taken as such.

It is comment on the way systems can end up with more people than really necessary checking and monitoring rather than engaging in the productive business of building the nation.

And as a recent court case has shown, with all the oversight, all the processes, all the forms being filled out correctly – we still saw $3 million of fraud go undetected by ‘the system’.

This wrong doing that occurred within DNR/FRA was not identified by audit or oversight within the system.

It was not detected through the numerous reporting lines that exist.

It was identified through investigations by the people who were establishing FRA and observed ‘patterns’ in payments that seemed a little odd and warranted a bit more scrutiny.

This massive fraud was uncovered IN SPITE of the system put in place to prevent – not because of it.

In any case where process becomes the end rather that the means the system will fail and in this case it has been shown to have failed.

 

So what is the alternative?

The alternative is an environment where good governance, ethical behaviour and sound leadership is the norm.

The environment will be self-regulating to a much greater extent than we see at the moment and the level of audit and oversight required will be more balanced and risk based.

To use Fiji Roads Authority as an example that I am intimately familiar with. It was established by Government on modern principles of accountability for a corporate statutory authority of this nature.

It is answerable to a Minister through a governance entity that is essentially a Board of Directors; and I am pleased that we now have the governance Board properly constituted as required by our founding legislation.

In terms of reporting and accountability FRA is required by statute to deliver a mid-year report to the Minister as well as an Annual Report.

It is audited by the central auditing agency for Government on an annual basis. Those audits are tabled in parliament and subject to public scrutiny.

With good governance as a core principle, FRA has established an Audit and Risk Committee and it conducts a range of internal audits across the organisation and into our suppliers.

 

FRA operations

Now – bear in mind that with deliberate consideration Government established the statutory basis for FRA to operate in this way just four years ago.

Government’s clear intention was an entity that DID NOT operate ‘the way we’ve always done it’.

Which is why many of you readers would have witnessed my frustration whenever FRA is required to put resources into unproductive effort to satisfy processes.

That in my observation add no value to what we do and are of extremely questionable value to anyone else.

So why was the symposium so necessary? It is because FRA is not an isolated case.

These sorts of issues affect the productivity of the entire nation.

And if we are to move forward as a nation at some point the dialogue needs to happen openly, and objectively – and it has to become completely unacceptable for anyone, at any level, to consider “that’s the way we’ve always done it” as an adequate answer.

 

Taking Fiji forward

I recall the Attorney-General speaking at the CPA congress in 2013 where he exhorted the professions to become more visible and vocal in their critique and commentary on matters of public interest.

I fully agree with these sentiments. The professions, all of them, must take ownership of forming the modern system of governance across public sector and civil society that will take Fiji forward to the bright future that awaits.

For good governance to become the norm we need forums like our recent symposium where people can share good practice.

We need directors to have access to training that shows them their role is policy, management of risk, monitoring for performance and so on.

We need to develop an environment where people of integrity are rewarded and ethical behaviour is honoured – so that over time ‘natural selection’ will favour those who act in the public interest rather than self-interest.

 

And what is ‘integrity’?

The best definition I’ve come across is that integrity is doing the right thing even when no one is watching.

When doing the right thing is part of who you are as an individual, and what you are as a company or a profession, then the level of external regulation, audit, oversight or policing needs to be much less.

Integrity and ethics cannot be just another statement we put on the wall beside our mission, vision and values.

Ethics has to be individual and collective. Ethics is holding true to those values we espouse even when the going gets tough.

It is very easy to be ethical and have integrity when things are going well. But when things aren’t going well the temptation to compromise our values increases.

Blacktop Construction had operated in Fiji for a number of years. They had a nice corporate Vision, Mission and Values statement.

As a company they hit some tough times – it happens.

And while I am not saying that the executives in that company did anything illegal, it is my honest opinion that the pressure of a failing company led some of them to indulge in very unethical behaviour.

 

Importance of leadership

And this is why leadership is so important as part of the discussion. When the pressure is on and our values are tested it is imperative that we have people around us that we can rely on to provide some objectivity.

If we do not empower our people to be leaders in their own right we run the risk that they will not speak up.

Ultimately we will be worse off because of that. We need to take the opportunity to develop the leaders around us during the good times so they can support us in the tough times.

And when it comes down to it, integrity and ethics is really little more than individuals exercising leadership of themselves.

Feedback: rachnal@fijisun.com.fj

 

 



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