Monthly Archives: March 2014

How to Enhance the Performance and Continuity of Family Businesses

familybusinesses

  • How to manage family businesses effectively in a professional and result oriented way.
  • How to enhance the competitiveness of family businesses in a sustainable way by putting employees first, customers second and shareholders third.
  • How to create a climate of trust, harmony, peace, love, passion, integrity and performance within family companies. 
  • How to transfer leadership of a family business from one generation to the next effectively.
  • How to prevent a crisis of succession.
  • How to empower the next generation effectively to carry things forward successfully.
  • How to draft a successful family charter which sets out the family’s vision, mission, core values, and ethics and align this with the family business’s vision, mission, core values, and corporate governance code of ethics.

For example; Research shows that there are billions usd frozen in family businesses in the Middle East because of disputes between the siblings of the families after the death of the founders of the company. These disputes also cause the family-owned companies  to collapse or failure. About 98 percent of the companies operating in the Gulf Cooperation Council (GCC) are family-owned firms. About 33% of these companies are run by the second generation of the family, 15% are managed by the third generation of the family and only 4% of the companies are operated by the fourth generation of the family. There is a need for continuity of family businesses because these companies’ contribution  to the GDP is about 22-30% percent. Family businesses should therefore be managed in a more professional, innovative and humanized way and by strengthening the entrepreneurial leadership skills of the next generations. Prof.Dr. Hubert Rampersad’s worldwide recognized transformational entrepreneurial leadership and change management program –TOTAL PERFORMANCE SCORECARD & AUTHENTIC GOVERNANCE – provide a holistic and authentic framework and specific tools to enable family businesses to effectively create a high performance corporate culture, directly aligned with desired business strategy and results in a sustainable way. This very practical and highly interactive training is designed to enhance the performance and continuity of family businesses. 

employee first

This innovative and unique system will help enhance the competitiveness of family businesses by putting employees first, customers second and shareholders third. It will also help create a climate trust, harmony, peace, love, passion, integrity and performance within family companies. The transfer of leadership of a family business from one generation to the next will be much smoother based on this new approach. This system also focuses on the development of the self-awareness and help manage the emotions of the next generations, by coaching them to understand themselves and develop their self-responsibility, providing them the tools to manage themselves effectively and introducing ways to  enhance the performance of their organization organically, based on effective teamwork. They will get in touch with themselves in a deep and meaningful way that will strengthen their authenticity and enhance their effectiveness. This unique approach also creates harmony, peace and trust between the siblings of the families and a stable basis for the continuity of family businesses. Until recently, a family business would follow the law of primogeniture – that is, it would be passed down to the oldest son. Nowadays, succession is possible via daughters, as well. This program “Female Entrepreneurial Leadership Branding” is specially designed for daughters. The current generation is not necessarily following in the footsteps of the previous one, instead choosing to follow their own career paths (which may not involve working in the family business). This training will help them to make the right choices in their life, based on their dreams and align these with their passion. It will also focus on empowering the next generation effectively to carry things forward successfully and passing on the torch correctly to enable a smooth transition. We will also help you draft a successful family charter which sets out the family’s vision, mission, core values, and ethics and align this with the family business’s vision, mission, core values, and corporate governance code of ethics. This is based on Dr. Rampersad unique Authentic Governance system, which has just been published globally. Check this article: “Why Traditional Corporate Governance Implementations Fail and Lack Sustainability”. ———————————————————————————- “It is easy to love the people far away. It is not always easy to love those close to us. It is easier to give a cup of rice to relieve hunger than to relieve the loneliness and pain of someone unloved in our own home. Bring love into your home for this is where our love for each other must start”.—Mother Teresa “Family is the root of all that is good in our lives”.-– Ivana Trump ——————————————————————————- h During this 2 or 3-day in-house  Training Prof.Dr. Hubert Rampersad will also help you to utilize his unique TOTAL PERFORMANCE SCORECARD & AUTHENTIC GOVERNANCE method to realize the best fit between family members and organization that will result in increased engagement and retention. You will also learn how your company will develop a high performance ethical culture and enhance workforce productivity to meet world class standards. Dr. Rampersad’s change management system energizes people and stimulates engagement, commitment, integrity, and passion within the organization. They work smarter and focus on activities that create value for clients.  He is frequently being asked globally to act as a neutral and trusted family business consultant who can help you ease the transfer from one generation to the next successfully. This training is designed to accomplish several key objectives:

  • Manage family businesses in a professional, result oriented way.
  • Enhance the competitiveness of family businesses in a sustainable way by putting employees first, customers second and shareholders third.
  • Create a climate of trust, harmony, peace, love, passion, integrity and performance within family companies.
  • Transfer of leadership of a family business from one generation to the next effectively.
  • Prevent a crisis of succession.
  • Empower the next generation effectively to carry things forward successfully.
  • Draft a successful family charter which sets out the family’s vision, mission, core values, and ethics and align this with the family business’s vision, mission, core values, and corporate governance code of ethics.
  • Develop entrepreneurial leadership skills.
  • Develop an ethical business culture and strengthen corporate governance.
  • Managing conflicts effectively.
  • Aligning the family corporate goals with the goals of the siblings.
  • Implement and manage family organizational change effectively.
  • Practice change leadership and personal skills that make it easier to foster buy-in to change across the family company.

Who should attend This unique and highly practical and interactive in-house training has been specially designed and customized for founders/owners, senior executives and managing directors and family members of family businesses. and dimensions indicate the organization’s maturity compared with that needed for management excellence.

Duration of the program: 1 day, 2 days or 3 days

Training Fee: Email us at info@iusv.university for information about fee, dates and location. Fee includes seminar documentation, signed copy of Dr. Rampersad’s book and certificate of attendance from the Innovation University of Silicon Valley in California.

In-house: This practical workshop can be conducted in-house. We tailor the training according to your needs and requirements.

Follow up: This master class entails 3 CREDITS POINTS for enrollment in our MBA/PhD degree program.

This training is based on the bestselling management books by Dr. Hubert Rampersad 
9783319031125

                                                                                                                           

Total Performance Scorecard; Redefining Management to Achieve Performance with Integrity .   With a Foreword by Professor Dorothy Leonard, Harvard Business School Endorsements: “Hubert Rampersad has amassed and synthesized a huge amount of material . . . The book serves as a practical guide, in that there are numerous exercises and business illustrations.”—From the Foreword by Dorothy A. Leonard, The William J. Abernathy Professor of Business Administration, Harvard Business School.  

“Hubert Rampersad takes the balanced scorecard and other management ideas and puts them in a framework of personal integrity. By unifying organizational change strategies with individual ethics he has written an outstanding synthesis, which is addressed to the corporate challenges of managing in the 21st century.”—Paul Bracken, Professor of Management, Yale School of Management

“Hubert Rampersad’s Total Performance Scorecard is management technology for the enlightened age. Rampersad beautifully explains how anyone can apply principles of motivational alignment and individualistic scorecard techniques to engineer an organization for continuous learning.”—Dr. James O’Toole, Massachusetts Institute of Technology

Peter Senge broke the mindset barrier and showed how systems thinking and system change are essential to support individual development. The strength of TPS, however, is that it measures personal development in the context of organizational development. This highly interactive process creates the foundation for dynamic change where everyone can benefit from constant learning and improvement. Dr. Rampersad’s brilliance lies in bringing Peter Senge’s ideas of system symbiosis into alignment with ideas of personal ambition, vision and mission. When leaders can accurately measure true performance – low, average or outstanding – it is possible for the ideal to become a reality. ”.–George A. Kohlrieser, Professor of Leadership & Organizational Behavior IMD, Switzerland

“The United States Air Force is trying to become more accountable for performance using the Balanced Scorecard method, but I like the way Dr. Hubert Rampersad has tied the BSC to a Personal Balanced Scorecard. It’s almost like Kaplan & Norton meet Stephen Covey”-  Bob Marx, United States Air Force

“Total Performance Scorecard is a thorough, systematic, and integrated approach to individual and organization success. It synthesizes and extends personal, leadership, and organization theories of change and success. It offers managers tools to do a complete physical for their organization and it offers individuals an encyclopedia of knowledge about personal success.”—Dave Ulrich, Professor of Business, University of Michigan, ranked as #1 management educator and guru by Business Week, #2 among management thinkers by Executive Excellence, and listed by Forbes as one of the “world’s top five” business coaches.

“Hubert Rampersad is one of the great thought leaders that is both helping organizations increase effectiveness and helping people have better lives. He is helping make the world a better place, and is one of the few consultants who look at the entire picture – not just a small part.”  —Marshall Goldsmith, recently recognized as the #1 leadership thinker in the world at the bi-annual Thinkers 50 ceremony sponsored by the Harvard Business Review.

 Outcomes When Implementing

Please fill out the registration form below.

Innovation University of Silicon Valley

Innovation University12 S. First St., San Jose, CA 95113, USA

Tel: +1-786-537-7580 | info@iusv.university | http://www.iusv.university

Female Entrepreneurial Leadership Branding

Female Entrepreneurial Leadership Branding
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Most buying decisions are based on trust, confidence, and the feeling of connection people have related to a product or person. It’s the trusted relationship that counts! Having a strong authentic A_getty_images_Sport_Oprah winfreyFemale Entrepreneurial Leadership Brand is a very important asset in today’s online, virtual, and individual age. It is becoming increasingly essential and is the key to personal and business success for females.

Female Entrepreneurial Leadership Branding is the positioning strategy behind Oprah Winfrey. To become successful as a women it’s important to be your own brand and to become the CEO of your life. Everyone has a Personal Brand but most people are not aware of this and do not manage this strategically, consistently, and effectively. You should take control of your brand and the message it sends and affect how others perceive you. By way of this interactive and practical workshop, Prof. Dr. Hubert Rampersad will offer you an advanced breakthrough formula and a new blueprint to build, implement, maintain, and cultivate an authentic, distinctive, and memorable authentic female entrepreneurial leadership brand, which forms the key to enduring personal success. It’s based on his new best selling books: “Be The CEO of Your Life; The Ultimate Authentic Personal Branding Formula for Standing Out from the Crowd”  and ”Authentic Personal Branding: A new blueprint for building and aligning a powerful leadership brand.

Dr. Rampersad is the world’s leading authority on authentic female entrepreneurial leadership branding. His trademarked organic, holistic and authentic entrepreneurial leadership system helps you to unlock your potential and build a trusted image of yourself that you want to project in everything you do. It also opens your view to new ideas, possibilities and business opportunities. It is combined with powerful tools to deliver peak performance and to create a stable basis for trustworthiness, credibility, and personal charisma.
                                                                                                                                                Dr. Rampersad’s innovative female entrepreneurial leadership methodology is spiritual, measurable, holistic, organic, authentic and sustainable. It taps deeply into self-awareness and helps others to develop innovative ways of doing business with social media and to position themselves strongly in this individual age. It has been proven in practice to produce sustainable results, not only for individuals but also for companies.  Here are some testimonials about this unique coaching system. US Army & US Air Force are using our system as well and Alan Mulally (President, Chairman, CEO of Ford Motor Company) is also a huge fan of this innovative approach. Over 15,000 male and female professionals worldwide have experienced the effectiveness of the authentic entrepreneurial leadership system after attending his personal  master classes.
                                                                                                                                              Why Attend this Exclusive Master Class?
Building an authentic female entrepreneurial leadership brand is an evolutionary and organic process and a journey towards a successful life. Your brand should emerge from your search for your identity and meaning in life, and it is about getting very clear on what you want, fixing it in your mind, giving it all your positive energy, doing what you love and develop yourself continuously. This workshop provides you a holistic and complete female entrepreneurial leadership branding framework that will help you to create a powerful, authentic, consistent, and memorable entrepreneurial leadership brand identity that builds a trusted image of yourself and will help you enrich your relationships with others, master yourself, unlock your potential, and develop self-esteem. By aligning your brand with yourself you will create a stable basis for your trustworthiness, credibility, and personal charisma. This master class is an experience that will enhance the core of female entrepreneurial leadership. 
                                                                                                                                              You will gain understanding about:

• Building and implementing a distinctive and compelling female entrepreneurial leadership brand.• Building a strong reputation that is aligned with your vision and passion.• Developing authentic female entrepreneurial leadership skills.• Building credibility and a solid reputation• Putting you above your competitors• Enhancing your sales performance• Positioning yourself effectively• Building your business with social media marketing• How to become an authentic female entrepreneurial leadership coach.

Who should attend?

This unique and highly practical and interactive course has been specially designed for female entrepreneurs, managers and  professionals who wish to differentiate themselves, set themselves apart from others, position themselves strongly in relation to competitors, and build credibility and a solid reputation.

Duration of the program: 1 day, 2 days or 3 days

Training Fee: Email us at info@iusv.university for information about fee, dates and location. Fee includes seminar documentation, signed copy of Dr. Rampersad’s book and certificate of attendance from the Innovation University of Silicon Valley in California.

In-house: This practical workshop can be conducted in-house. We tailor the training according to your needs and requirements.

Follow up: This master class entails 3 CREDITS POINTS for enrollment in our MBA/PhD degree program.

                                                                                                        

From the book’s foreword by Marshall Goldsmith: “In Personal Branding, Hubert Rampersad has provided a sorely needed guidebook for knowledge workers. He shows us all how to build our own personal brand – and just as important – how to persuasively communicate this brand to the world… I love his focus on authenticity… My request to you, the reader, is – make this book part of 6your life.  Don’t just read this book for its ‘interesting’ content.  Don’t be content with a few ‘aha’ moments. Make it part of your life planning – and ultimately part of your life!  If you do, you can become a more integrated and successful person – and better enable your company to help you make a positive difference in our world!” Marshall Goldsmith is Harvard Business School Press bestselling author of What Got You Here Won’t Get You There, a New York Times bestseller, Wall Street Journal #1 business book and the Harold Longman Award winner for Best  Business Book of the Year for 2007.

From the Afterword by Dave Ulrich: “Hubert Rampersad has a knack for preparing comprehensive frameworks for analyzing important issues… The four stage model that he suggests proposes an explicit way to turn a desired external identity into something concrete and actionable… It’s a wonderful step by step approach to making out desired brand explicit… The mental models and their related investigative questions will help you know where you are today so you can get to where you want to be tomorrow… This book offers an architecture to turn these ideas into action.” Dave Ulrich is Professor of Business, University of Michigan. He is the author of the bestselling book “Leadership Brand’ ( Harvard Business Press, 2007). He was ranked as #1 management educator and guru by Business Week, #2 among management thinkers by Executive Excellence, and listed by Forbes as one of the “world’s top five” business coaches.

12985386_824638520974245_2646527565497204144_nRampersad’s new Chinlenovoese personal leadership branding book FIND THE BLUE OCEAN IN YOU is foreworded by Yang Yuanqing, Chairman/CEO of Lenovo

The complete framework for defining and implementing a sustainable, powerful and authentic female entrepreneurial leadership brand identity.

Importance of Authenticity

Traditional personal branding approaches are focused on personal marketing, personal sales, social media marketing, image building, and styling, which can turn into an ego trip. Authentic entrepreneurial leadership branding is more than just marketing and promoting yourself and it is not about being famous and not about trying to be someone you’re not. It is about the Real You and influencing others based on integrity and delivering what you promise. If you are not branded in an authentic, honest, and holistic way, if you don’t deliver according to your brand promise, and if you focus mainly on selling and promoting yourself, you will be egocentric and selfish.   

Authenticity is about being real and true to yourself. Your entrepreneurial leadership brand should therefore emerge from your search for your identity and meaning in life, and it is about getting very clear on what you want with your life, accepting it, fixing it in your mind, giving it all your positive energy, doing what you love and improve yourself continuously.

Dr. Rampersad’s other related workshops:

Please fill out the registration form below.

Innovation UniversityInnovation University of Silicon Valley

12 S. First St., San Jose, CA 95113, USA

Tel: +1-786-537-7580 | info@iusv.university | http://www.iusv.university

 

 

 

 

 

 

Why Corporate Governance Fails

 

corporate-governance-sucks

By Hubert Rampersad, Ph.D.

Poor ethical leadership, lack of integrity, mismanagement, fraud, corruption, and violation of corporate governance rules are the main contributors towards bankruptcy and financial failures. 

Some recent rare examples of corporate governance not working the way it should:

  • Massive corruption at Wells Fargo, which led to the resignation of its chief executive, John G. Stumpf. In September 2016, Wells Fargo reached a $185 million settlement with federal regulators and acknowledged that thousands of employees, under intense pressure to meet aggressive sales targets, opened as many as two million bogus accounts without customers’ knowledge, in some cases forging signatures. Wells Fargo implemented one of the best corporate programs in America, advised by Harvard Law School professors.
  • Corruption at Apollo Global Settles Securities Case as S.E.C. Issues $53 Million Fine. Apollo misled its investors about two different issues and separately failed to supervise a senior executive suspected of misconduct. Apollo implemented a great corporate program by one of the BIG Four Accounting firms.
  • Corruption at Tesco that shocked the markets with an announcement acknowledging their profits for the previous six months were at least £250 million pounds lower than they announced a month ago. Tesco implemented a complete corporate program by one of the BIG Four Accounting firms.

Having great corporate governance programs in place but not complying to these programs has become a normal practice globally. Current approaches to corporate governance are extremely formal, bureaucratic, cosmetic, non-holistic and non-authentic, and therefore provide no protection from potentially catastrophic ethical failures.

Most corporate governance programs made things worse, create a stable basis for more corruption and are doomed to fail. We need a sustainable and innovative solution to this global epidemic urgently. I picked up where others left off  by launching an innovative and sustainable methodology for creating a culture of good people, in which high ethical values are aligned with their corporate governance rules, regulations and guidelines and embedded in their mind. It 9783319031125is based on my new book “Authentic Governance; Aligning Personal Governance with Corporate Governance“.  Two main endorsements for this book:authentic-governance-for-banks-front

1) “Authentic Governance is a systematic, integrated, pragmatic, and innovative approach to corporate governance. By expanding traditional corporate governance concepts and integrating personal integrity and ethical leadership into one overall authentic governance framework, Dr. Hubert Rampersad gives us a new blueprint for sustainable corporate governance in which formal corporate regulations and personal values mutually reinforce each other. By unifying corporate ethics with individual ethics he has written an outstanding synthesis, which is addressed to the corporate challenges of managing in the 21st century.

2) This book makes a most useful contribution to the never ending challenge of protection from potentially catastrophic ethical failures. It serves as a practical guide and a tool kit for executives who aspire to realize ethical corporate excellence”.

Authentic Governance starts with value-based leadership development, embedding personal values in the mind of the Chairman, President, CEO, CFO, managers and all employees, and guiding them to sincerely reflect on these values. This is about decency and personal integrity. Authentic Governance is one of the first tangible and measurable means to create a way of life within organizations, characterized by trust, credibility, transparency, personal responsibility, personal integrity, and a high performance ethical business culture. This will have a positive impact throughout society’.

Introduction

Many governments and large companies everywhere are currently very keen to revamp, develop, and implement a corporate governance code to address the above mentioned shortcomings. Unfortunately, all these codes are cosmetic and do not provide adequate protection. An other example, the collapse of Lehman Brothers seen by a lot of people, a corporate governance failure, not a failure of financial markets, in September 2008, was the biggest bankruptcy in the corporative history of the USA, and the event that conduced to the largest and video logo 1worst financial crises of the last decades. The most resonant similarity with Enron is appearance of the name of a large audit firm, Ernst & Young, “they didn’t approve the Accounting Policy”, it rather “became comfortable with the Policy for purpose of auditing financial statements” (Alexandru, 2012). Two of the Lehman’s financial directors were in the past engaged in a collaboration with Ernst & Young. And in the last year of complete financial reporting, Lehman Brothers was the 8th largest customer for E&Y, and the fee paid by LB was about $185 millions. Worrying is that we are not learning from history and not to repeat the same mistakes, and those from Lehman Brothers walked the same steps of collapse as Enron did.

The situation at JPMorgan Chase, the world’s largest bank, early this year is an interesting case with regard to corporate governance. Government investigators have recently found that JPMorgan Chase devised “manipulative schemes” that transformed “money-losing power plants into powerful profit centers,” and that one of its most senior executives gave “false and misleading statements” under oath. JPMorgan executives also ignored a series of alarms that went off as the bank’s Chief Investment Officer breached one risk limit after another. Rather than ratchet back the risk, JPMorgan personnel re-engineered the risk controls to silence the alarms. In a previously undisclosed case, prosecutors examined whether JPMorgan failed to fully alert authorities to suspicions about Bernard Madoff. And nearly a year after reporting a multibillion-dollar trading loss, JPMorgan did face a criminal inquiry over whether it lied to investors and regulators about the risky wagers. This case pinpoints that JPMorgan’s corporate governance code and exhaustive regulations do not provide adequate protection. A recent study conducted by Labaton Sucharow, a New York City law firm, suggested that Wall Street still has a shaky grip on its ethical compass. Despite the financial changes enacted after the 2008 financial crisis, improper and even illegal activity is perceived as common among traders, brokers, portfolio managers, and bankers.

The table below is a summary of some other resonant cases of failure of corporate governance, in addition to the causes that led to these failures, another interesting thing to note is that most cases have occurred in the USA (Alexandru, 2012).

tabel

Behind all these scandals are a number of common factors, including:

  • Poor ethical leadership and lack of personal integrity
  • Mismanagement and management incompetence
  • Fraud, corruption, and violation of corporate governance code of ethics
  • Non-observance of the procedures stipulated in internal regulations
  • Insufficient attention paid to risk management
  • Inconsistent distribution of duties and responsibilities
  • Inefficiency of internal audit
  • Ignorance showed to the signals provided by external audit
  • Influencing the external auditors to express an audit opinion inconsistent with reality.

All the above mentioned organizations have comprehensive corporate governance codes in place, implemented by left brain Big Four accountancy firms and large law firms and advised by top Harvard Law School professors, which apparently are not working at all. They made things worse and created a stable basis for more corruption.

Unethical behavior of top-executives, poor ethical leadership, lack of personal integrity, mismanagement, fraud, corruption, and violating corporate governance codes are the main contributors towards most of these scandals. The human element represented by the directors and employees is the major cause of the mentioned failures. Especially unethical behavior of leaders is the main cause of bankruptcy and financial failures. Remember what Alan Greenspan, Former Chairman of the Board of Governors of the US Federal Reserve System, said: “Our market system depends critically on trust—trust in the world of our colleagues and trust in the world of those with whom we do business…. I am saying that the state of corporate governance to a very large extent reflects the character of the CEO.”

Higher education system Sucks as well

The main underlying reason for most corporate governance failures is the fact that the current higher education system sucks. Successful corporate governance implementation requires a multidisciplinary, authentic and holistic approach. Many top Law Schools and Business Schools  such as Harvard Law School and Harvard Business School have a mono-disciplinary curriculum with a narrow non-holistic and non-authentic focus. In this way most of these schools destroy creativity and  many of their graduates in the corporate governance world (such as lawyers, consultants and executives) miss the bigger picture and do not think holistically. Due to this they focus solely on formal and woolly corporate governance regulations, procedures and guidelines, causing massive damage in global business society. 

Remember this: creativity and innovation in the classroom come down to the professor’s creativity, self-innovation and self-knowledge.

Many law, accounting and business management professors at these top schools are also to blame for most of the above mentioned corporate governance failures.  They lack both emotional and spiritual intelligence. This inner process starts with self-knowledge, or knowing, which leads to wisdom. Between knowing and wisdom lies an enormous distance which can be reduced by boxsystematic application of my authentic governance system. This will help them to create balance between the left and right sides of their brain. The left half of their brain has mainly an analytical, logical and quantitative function, while the right half of their brain has an intuitive and holistic function. They do not have a proper balance between the left and right sides of their brain. These professors and most of their graduates use the left side of their brain only; because of this, they miss opportunities that allow them to become more adept at using the right hemisphere of the brain and to deal with complex corporate governance problems in an integrated and authentic way.  This is also the main reason why Harvard Business School professor Kaplan’s Balanced Scorecard implementations fail and lack sustainability, causing massive damage in global business society.

Why don’t you do your own due diligence by analyzing the articles being published frequently in Harvard Business Review, Harvard Law Review, MIT Sloan Management Review, California Management Review, McKinsey Quarterly, Yale Business Review,… and you will find out that almost 80% of the management/corporate governance/leadership theories and concepts being published in these top journals are just BS; not authentic, not holistic, woolly, and therefore cosmetic and not sustainable.  

Left brain professors need to be encouraged to start acting intuitively thus making more effective use of their right side of their brain in order help create a better world. Therefore, my main passion is coaching left brain professors to become innovative, helping them to strengthen their management/leadership/corporate governance concept via my Exclusive Master Class Authentic Governance.

Due to the above mentioned shortcomings most companies’ approaches to corporate governance are extremely formal, bureaucratic, cosmetic, woolly, non-holistic and no-authentic, and therefore fail to address above mentioned shortcomings. Their implementations of corporate governance provide no protection from potentially catastrophic ethical failures. We need a sustainable and innovative solution to this global epidemic urgently, which I will present in the next section of this article.

A sustainable innovative solution

It is time that we become aware that corporate governance cannot be controlled effectively with formal and exhaustive rules, regulations, guidelines, and procedures only. It’s about decency and personal integrity and this must be cultivated from within. Personal integrity has no need of rules. It must be a way of life.
 
Remember what Plato said in 340 BC: Good people do not need laws to tell them to act responsibly, while bad people will find a way around the laws”. Research shows that a large percentage of the world’s population is bad. For example, America has around 5% of the world’s population, and 25% of its prisoners. Roughly one in every 107 American adults is behind bars.  Among them are also many executives, leaders and professionals. 

                                                                                                                                           Most corporate governance programs make things worse, create a stable basis for more corruption and are doomed to fail. Why don’t we learn from Plato and focus on creating a culture of good people, in which personal values are aligned with the laws and embedded in the mind of the people, instead of focusing on  laws (corporate governance) only? I picked up where others left off  by launching an innovative methodology for creating a culture of good Chairmen, Presidents, CEOs, CFOs, managers and employees, in which high ethical values are aligned with their corporate governance rules, regulations and guidelines and embedded in their mind. 

As demonstrated by Enron and others, traditional corporate governance codes (corporate laws) provide no protection from potentially catastrophic ethical failures. Company integrity must always start with personal integrity. It must be an informal learning process and a way of life, based on alignment with yourself and alignment with your company. This ethical process must be promoted and communicated within the whole company to all stakeholders consistently. In this way ethical behavior will become a routine in the whole organization, and leaders and employees will gain more understanding about their responsibility with regard to ethical behavior. They will understand that it is their responsibility to act ethically, on duty as well as off duty. This is a more sustainable, comprehensive and holistic approach to ethics and social responsibility.

PrintAgainst this background, I propose an organic and holistic approach to corporate governance, by integrating personal values and integrity into one overall authentic governance framework, in which formal corporate regulations and personal values mutually reinforce each other. This theory has been borne out through my leadership experiences in the corporate world globally in the past 30 years. I was also inspired by the leadership vision of Harvard Business School professor Bill George, who outlined in his article ‘“Why Leaders Lose Their Way’” why powerful and talented leaders often misbehave and how they lose their moral bearings, such as: Hewlett-Packard CEO Mark Hurd who resigned for submitting false expense reports concerning his relationship with a contractor; US Senator John Ensign (R-NV) who resigned after covering up an extramarital affair with monetary payoffs; and  Lee B. Farkas, former Chairman of giant mortgage lender Taylor, Bean & Whitaker, who was found guilty for his role in one of the largest bank fraud schemes in American history. According to Bill George, they can avoid these pitfalls by devoting themselves to personal leadership development that cultivates their inner compass, based on self-reflection. This process requires thought and introspection because many people get into leadership roles in response to their ego needs.

Sustainable corporate governance starts with personal leadership development, based on self-reflection and introspection and embedding personal values in the mind of the Chairman, President, CEO, CFO, managers and employees, and coaching them to reflect on these values honestly. It’s about values-based Leadership. Steve Jobs once remarked, “The only thing that works is management by values”. This is done, according to the authentic governance method I have  launched in my new book; by coaching the Chairman, President, CEO, CFO, managers and employees to reflect on their “personal ambitions and their alignment with their behavior and actions.” In this way good corporate governance will be a way of life, characterized by trust, credibility, transparency, personal and social responsibility, open communication and a continuous learning process, embedded in an ethical culture. This cultural shift will have a positive impact throughout society.

Authentic Governance Model
In this article I introduce a more sustainable, authentic and holistic approach to corporate governance, which I call authentic governance. I have defined authentic governance in holistic humanized terms, namely: the systematic process of continuous, gradual and routine improvement, steering, and learning, that lead to sustainable high performance and ethical excellence. I made a distinction between authentic personal governance and authentic corporate governance, which I will explain below in detail. So, authentic governance is a continuous voyage of discovery, involving continuous, gradual and routine improvement, steering, and learning. It is about a journey towards a happier and more successful life for individuals and ethical corporate excellence.

By redefining and governing themselves effectively, leaders and employees will gain more understanding about their responsibility regarding ethical behavior, and they will understand that it is their responsibility to act ethically, on duty as well as off duty. Figure 1 shows the related authentic governance model, which provides an excellent framework and roadmap to develop, implement, and cultivate personal governance and corporate governance in a systematic and sustainable way. This new governance blueprint is an inside-out approach and focuses mainly on the human side of good governance. It places more emphasis on understanding yourself and the needs of others, meet those needs while staying true to your personal and corporate values, improve yourself and your personal integrity continuously, making ethics a way of life and a continuous learning process, and align these with formal corporate regulations, procedures and guidelines, instead of focusing on exhaustive formal corporate regulations, procedures and guidelines only.
fig 2.1-
Figure 1: Authentic Governance Model (© Hubert Rampersad)

This authentic governance model consists of the following four phases (see Figure 1), which are the building blocks of sustainable corporate governance:

1. Authentic Personal Governance:

a) Personal ambition; this phase involves a soul searching process based on thought, introspection, and self-reflection, supported by a breathing and silence exercise. Question which you can ask yourself are: Who am I, What do I stand for? What makes me more ethical? What do I live for? Why do I want to lead? and What’s the purpose of my leadership? If the honest answers on the last four questions are power, prestige, and money, you may be at risk for your company. The result of this phase is the formulation of your personal mission, vision and values. On the basis of insights acquired through this process, you develop self-awareness and self-regulation, which are the foundation of trustworthiness, integrity, and openness to learn.
b) Personal Balanced Scorecard (PBS); personal ambition has no value unless you take action to make it a reality. Therefore the emphasis in this stage is developing an integrated and well balanced action plan based on your personal ambition to develop personal integrity. It’s about translating your personal ambition into action.

c) Personal governance; the next step is to implement, maintain, and cultivate your ambition and PBS to govern yourself effectively and to become a better human being. This entails personal governance; the systematic process of continuous, gradual and routine personal improvement, steering, and learning. Your PBS needs constant updating to reflect the new challenges you take, the lessons you have learned, and the growth of yourself.

2. Alignment with yourself; corporate governance will be cosmetic if personal integrity is not a way of life in your organization and if you focus mainly on ethical procedures, formal regulations, and guidelines. Therefore it’s needed to align your personal ambition with your behavior and your way of acting (see Figure 2). So you need to commit yourself to live and act according to your personal ambition and to keep promises that you make to yourself. Personal governance built on the person’s true character is sustainable and strong. You should reflect your true self and must adhere to a moral and behavioral code set down by your personal ambition. This means that who you really are, what you care about, and your passions should come out in your personal ambition, and you should act and behave accordingly (you should be yourself) to build trust. This inner alignment is an important step towards lasting personal growth and reinforcing integrity, honesty, trustworthiness, credibility, transparency, and personal charisma. People with this perspective on life value others’ lives and create a stable basis for others to feel they are credible, truthful, and trustworthy.
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Figure 2: Aligning Personal Ambition with Personal Behavior and Actions

These first two stages in the authentic governance model focus on personal leadership development by cultivating your inner compass.

3. Authentic Corporate Governance:
a) Corporate ambition; this phase involves formulation the shared corporate ambition. The corporate ambition is the soul, core intention and the guiding principles of the organization and encompasses the corporate mission, vision, and core values.
b) Corporate Balanced Scorecard (CBS); the corporate ambition has no value unless you don’t take actions to make it a reality. Therefore the emphasis in this stage is developing an integrated and well balanced action plan based on the corporate ambition to realize the corporate objectives. The CBS is needed to improve the business and governance processes continuously based on the corporate ambition in order to add value to customers and satisfy them.
c) Corporate governance; the next step is to implement, maintain, and cultivate the corporate ambition and CBS in order to govern your organization effectively, to become an ethical company. This entails corporate governance: the systematic process of continuous, gradual and routine corporate improvement, steering, and learning. This stage focuses also on the implementation of formal corporate regulations, procedures and guidelines (corporate governance code). To operate in accordance with the corporate ambition and related CBS, through its implementation using the PDAC cycle, results in a journey towards sustainable and ethical business success.

4. Alignment with your organization; the emphasis here is aligning personal ambition with corporate ambition and creating uniformity of personal and organizational values. By unifying corporate ethics with individual ethics you will create a strong foundation of peace, integrity, engagement, and learning upon which creativity and growth can flourish, and life within the organization will become a more harmonious and ethical experience.  It’s about aligning personal governance with corporate governance and getting the optimal fit and balance between these two activities in order to enhance labor productivity, to create a climate of trust, and to stimulate engagement, commitment, integrity, and passion in the organization. This alignment process is needed because staff members don’t work with devotion or expend energy on something they do not believe in or agree with. If there is an effective match between their interests and those of the company, and if their values and the company’s values align, they will be engaged and will work with greater commitment and dedication towards realizing the company objectives (see Figure 3). When the personnel’s personal ambition is in harmony with their company’s (are compatible) and combined in the best interest of both parties, the results will be higher productivity and sustainable corporate governance. Employees are stimulated in this way to commit, act ethically and focus on those activities that create value for clients. This will create a strong foundation of peace, personal integrity, and stability upon which creativity and growth can flourish, and life within the organization will become a more harmonious experience.
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Figure 3: Matching the Personal Ambition with the Corporate Ambition

The effective combination of all these four phases creates a stable basis for a high performance ethical organization. To illustrate the importance of this authentic governance model: Of the 140 businesses recognized by the Ethisphere Institute as the 2013 World’s Most Ethical Companies, Aflac and Starbucks have received this honor every year between 2007 and 2013.They have been judged to not only have exemplary ethical standards and policies, but also consistently high ethical practices. Their corporate governance codes are not empty words, but represent active coordinates in maintaining an ethical business culture, based on effective values‑based leadership and the alignment of personal governance with corporate governance.

Read also:  Why Balanced Scorecard Implementations Fail and Lack Sustainability   and Why Lean Six Sigma Implementations Fail and Lack Sustainability due to the above mentioned reasons.

Become a Certified & Licensed Authentic Governance ConsultantTM 
Authentic Governance Institute (www.authenticgovernance.org) is an Excellence Center agi-logo40at the Innovation University of Silicon Valley in San Jose, California (www.iusv.university). It’s the global not-for-profit membership association for the authentic governance profession. Become AGI member  and see what AGI can offer you at every stage of your authentic governance career. AGI also offers a comprehensive Certified & Licensed Authentic Governance ConsultantTM program for accountants, financial consultants, corporate governance practitioners and organizations globally. You will demonstrate your expertise and your commitment to the authentic governance profession with an AGI certification.

References

Alexandru, P. (2012), Failure of corporate governance – intention or negligence.

Noked, N., (2012), HLS Forum on Corporate Governance and Financial Regulation.

Rampersad, H.K (2014), Authentic Governance; Aligning Personal Governance with Corporate Governance, Springer USA, New York.

Rampersad, H.K (2008),Authentic Personal Branding:  A new blueprint for building and aligning a powerful leadership brand, Information Age Publishing, Conneticut.

Rampersad, H.K. (2013), Be The CEO Of Your Life, Global Vision Publishing House.

Rampersad, H.K. (2006), The Personal Balanced Scorecard; The Way to Individual Happiness, Personal Integrity and Organizational Effectiveness, Information Age Publishing, Conneticut.

Rampersad, H.K. (2003), Total Performance Scorecard; Redefining Management to Achieve Performance with Integrity, Butterworth-Heinemann Business Books, Elsevier Science, Massachusetts.

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