Leaders play an outsize role in integrity

By David Donaldson

Wednesday February 7, 2018

You don’t need a massive corruption scandal to build an ethical leadership culture, says Gill Callister, secretary of the Victorian Department of Education and Training — but it certainly helps.

Callister assumed the job at a time when several of the department’s old guard leadership had been accused of corruption, and has worked to reform how the organisation runs.

Leaders act as a kind of lynchpin when it comes to integrity, Callister points out.

“Research tells us that most people, rather than relying on their own moral compass, will look to others when dealing with ethical dilemmas. They particularly look to leaders, which means that good conduct can be an inspiration.

“But it also means — and this was certainly the experience a number of years ago in our department — that unethical conduct can rub off on staff and rub off on culture. We all know the phrase ‘this is how things happen around here’. Unethical actions by leaders are often copied much more readily than ethical ones, which makes our job harder, but also more important.”

But it isn’t just their ability to influence others that presents a corruption risk — the discretion afforded those in positions of power makes it easier to do the wrong thing.

“According to Ethics Unwrapped, which is a research project by the University of Texas, most people unsurprisingly like to think of themselves as ethical,” says Callister.

“The research found that leaders are particularly overconfident, despite being the most vulnerable to ethical breaches. After all, leaders hold the purse strings, employ the staff, purchase the goods and services, and often make a number of the decisions with government that affect our community.”

And while big corruption cases make the loudest headlines, integrity is about more than whether you have your hand in the till.

“You don’t need a massive fraud and corruption scandal to help build a stronger, ethical leadership culture that combines and connects the systems and controls and compliance processes with your behaviour and practices and culture in your organisation. It isn’t enough for leaders to think that they’re ethical just because they don’t commit fraud or pocket the petty cash. Ethical leadership is a much higher bar than that, and it’s not always easy and it’s fraught with dilemmas.”

A bad environment can change a good person

Now the Victorian Public Sector hopes to reform how its leaders behave, with the launch of IPAA Victoria’s integrity and ethical leadership program on Monday.

The syllabus will include mentoring, case studies and a focus on responses to ‘integrity moments’, to be delivered across six days over the next several months. The course’s first cohort will include 21 of the state’s top public sector leaders, who will help test and refine the approach.

Adam Canwell, a partner at consulting firm EY who helped put together the program, looked at some of the key drivers of bad behaviour in the public sector.

“All the evidence shows that you can put a good person into a bad environment and the majority of people will start to behave in a bad way,” he said at the launch. “The system and the culture drive behaviour as much as individual preference.”

Leaders who had dealt with such problems in the past told him that oversight was a key factor. “It’s the places where there are gaps where issues happen. The gaps could be a lack of respect between parts of the organisation, or a black hole where there’s no data coming out.”

Catching the ‘frequent flyers’

Tony Bates, deputy secretary governance policy and coordination at the Department of Premier and Cabinet, noted the role judgement plays. The Integrity and Corporate Deputy Secretaries Committee, which he chairs, had spent a “breathtaking” amount of time discussing gifts and benefits policies over the last 12 months, he said — but for good reason.

“These answers are not obvious. We’ve got intelligent, well-meaning people and you can still have quite different opinions on a lot of these things.”

It’s clear that not everyone is on the same page at the moment — or as well-meaning.

The committee has been doing some work on what he refers to as “frequent flyers” — people who resign just as an investigative process is complete and then pop up again in another department some time later.

It can also be a slippery slope, even with good intentions. This makes shared understandings of the meaning of integrity important.

In the current environment of stretched public service organisations and ministers anxious to get quick results, the temptation to ignore the red tape proves too strong for some. These “can-do coconuts”, as Bates calls them, can present a risk for the public sector in the long term.

“The IBAC lessons show us that it’s often the ‘can-do coconuts’ who can go off-reservation,” says Bates.

“It’s the people who get things done, but get things done by sometimes working around the system, and it often starts with good intentions. What we saw at PTV and Education is that they learn tricks, often originally with an intention that was good, they learn methods that create risk and danger for them.”

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