There are many reasons the great state of Texas is just that – great. One Texas truism (Texas translation – true or not) is that everything is bigger in Texas. I was reminded of a certain truism in the area of business ethics when I read the obituary of Lonnie ‘Bo’ Pilgrim in the New York Times. Pilgrim was the founder of Pilgrim’s Pride “a tiny feed and seed store into one of the biggest chicken producers in the United States”.

Yet it was not this business vision that brought Pilgrim his most notable business achievement. It was for his unusual method of dispensing political ‘donations’. In 1989, during a Texas legislative special session, Pilgrim, actually walked onto the floor of the House of Representatives when it was in session, handing out $10,000 checks to legislators on the floor of the Senate, with the “Made To Order” section left blank. Outraged, at their votes being seen to be bought and paid for in public; the Texas Legislature banned campaign contributions begin passed out on the floor of the House. As one might say – only in Texas.

To say there might be cultural differences between Texas and the rest of the political world on what constitutes undue influence or even quid pro quo might seem to be stating the obvious, yet Pilgrim is now remembered as a business visionary. I thought about these cultural differences when I read a recent article in the Harvard Business Review (HBR) by Erin Meyer, entitled “Being the Boss in Brussels, Boston and Beijing”, where the author considered cultural differences which can negatively impact leadership. I found it had some interesting insights for the compliance professional as well.

The author identified four different cultures of leadership. Somewhat surprisingly, they are not segregated by geographic region. The author found that “attitudes toward decision making can range along a continuum from strongly top-down to strongly consensual; attitudes towards authority can range from extremely egalitarian to extremely hierarchical.” The four are: (1) Consensual and egalitarian; (2) Consensual and hierarchical; (3) Top-down and hierarchical; and (4) Top-down and egalitarian.

  1. Consensual and egalitarian 

This type of leadership is typically found in Scandinavian countries; Denmark, Netherlands, Norway and Sweden. The author notes, “Consensual decision making sounds like a great idea in principle, but people from fundamentally nonconsensual cultures can find the reality frustratingly time-consuming.” Some of the things you should expect are decisions to take longer, with more meetings and process which requires you, as a Chief Compliance Officer (CCO), to demonstrate patience in the process. As a CCO you will be seen as a facilitator and must “take the time to ensure that the decision you make is the best one possible, because it will be difficult to change later.”

  1. Consensual and hierarchical

The author notes this type of leadership is found in Belgium, Germany and Japan; where the groups favor a leader investing more time in winning support of his underlings before coming to a decision. This means that your group will expect you as the leader to be a part of the discussions  while being a part of the decision-making process. You should focus on the quality and completeness of information gathered and the soundness of the reasoning process because final decisions are seen as commitments and not “easily altered.” Yet there should be a consensus and you must “invest the time necessary to get each stakeholder on board.” 

  1. Top-down and hierarchical

This group has the widest geographic range, including countries as diverse as Brazil, China, France, India, Indonesia, Mexico, Russia and Saudi Arabia. It is incumbent to remember you are the boss and expected to make the decision. The key ingredient is to “Be clear about your expectations. If you want your staff to present three ideas to you before asking your opinion, or to give you input before you make a decision, tell them. Old habits die hard for all of us, so reinforce—with clarity and specificity—the behavior you are looking for.” Particularly as an American, you must be care as an analogy may be interpreted as a decision.

  1. Top-down and egalitarian

This will be the structure that Americans are most familiar with and it includes countries most like the US: Australia, Canada and United Kingdom. Meyer believes these can be seen as speak up cultures, “no matter what your status is. You might not be asked explicitly to contribute, but demonstrate initiative and self-confidence by making your voice heard. Politely yet clearly provide your viewpoint even when it diverges from what the boss seems to be thinking.” Yet the final point, and this is what drives many other cultures crazy under this type of structure, is that decisions are not typically set in stone, there is a continual feedback loop of information which can affect a change in the decision when warranted so you must remain flexible.

All of these cultures will impact your compliance program as well, in addition to your role as a leader. Simply think of your hotline and the reluctance of many cultures to ‘speak-up’ or even raise their hand when they see an ethical or compliance issue. You must work with your various cultures within your organization to overcome such reluctance. Understanding this cultural disconnect is important. For many businesses, “the greatest business opportunities lie in the big emerging economies, which include Bangladesh, China, India, Indonesia, Russia, and Turkey. In nearly every case, these are cultures where hierarchy and deference to authority are deeply woven into the national psyche.” The management style of pushing decisions down in the “organization does not fit easily into the emerging-market context and often trips up Western companies on their first ventures abroad on the business side and most certainly in the compliance realm”, particularly if there is a different perception of what might be termed ‘ethical’.

Learning how your employees in other countries will approach decision-making and leadership will give you, as the CCO, insight into how they will approach compliance. It will require you to get out into the field to talk with folks. If your company grows organically or through mergers and acquisitions (M&A) or goes the joint venture (JV) route, it will need to understand how your new employees will not only think through issues but how they will relate to instructions from the home office in America.

What about the culture of the Texas legislature in 2017? Just remember if you have a donation to make, present the money in the legislator’s office; not on the floor of the House. In Texas, that makes all the difference.

 

This publication contains general information only and is based on the experiences and research of the author. The author is not, by means of this publication, rendering business, legal advice, or other professional advice or services. This publication is not a substitute for such legal advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified legal advisor. The author, his affiliates, and related entities shall not be responsible for any loss sustained by any person or entity that relies on this publication. The Author gives his permission to link, post, distribute, or reference this article for any lawful purpose, provided attribution is made to the author. The author can be reached at tfox@tfoxlaw.com.

© Thomas R. Fox, 2017

In this episode, Richard Lummis and I explore leadership lessons from Toussaint Louverture, who held the only successful slave revolt in the Western Hemisphere. Our remarks are based on the recent biography of him entitled, Toussaint Louverture by Phillipe Gerrard. While not an obvious character for study in a business leadership podcast, Louverture nonetheless presented several important lessons which translate into to today’s business environment.

  1. Know your goals. Louverture’s statements are usually ambiguous, but based on his actions he sought self-determination and respect even over abolition of slavery or independence. For example, Louverture never actually declared independence from France or slaughtered white planters
  1. Play a long game. Louverture was willing to switch allies and betray friends when necessary. At first, he tried to work with free blacks and planters, then Spanish, then the French, and finally for himself. There was a high cost, however. “Louverture had navigated the troubled waters of the Revolution whtough caution and deceit, but in the process, the people around him had concluded that they could never trust or love him. . . .Men who have no equal are condemned to live a lonely life.”
  1. Information control. Louverture established public relations by sending agents to Paris to shade the news. His opponents failed to do so. He also made extensive use of press censorship in Saint-Domingue to suppress unfavorable news and events while boosting his own prestige. Always knew what his audience wanted to hear and gave it to them.
  1. We are creatures of our upbringing. Here Louverture’s lesson is to be very careful about assuming what others’ goals might be going forward. Louverture sought to preserve sugar plantations, which was always going to conflict with freedom of workers. “The barrier was not only economic but psychological. Louverture was not nursed on the Jeffersonian ideal of an independent citizen-farmer. He cam of age in a region of the globe where wocial prestige was bestowed upon large landowners. . . . Despite (or because of) his servile past, Louverture desperately wanted to re-create a planter class, albeit one in which he and his fellow black generals would play the leading role . . . .The most enthusiastic white converts to the Revolution were known as “white blacks”; in many ways, he was a “black white” who had made the economic worldview of his former masters his own.
  1. Forgiveness goes a long way—but has its limits. Louverture had been trying to protect whites, but his nephew Moïse and Joseph Flaville, an old friend of Louverture’s, kelled over 300 of them, including the old master of the plantation where Louverture was a slave. [Louverture] had personally appointed him to his command early in the Revolution and then welcomed him back like a “prodigal son” every time he had rebelled. Not so this time: Louverture had him ripped to shreds by grapeshot in full view of the garrison of Cap. . . . Louverture’s natural inclination was to be merciful or to ask his subordinates to do his killing for him, but the Moïse uprising so infuriated him that up to 5,000 cultivators [former slaves now working on plantations] were killed in a matter of weeks. . . .Moïse [his nephew] was also a close ally who had assisted Louverture on numerous occasions, . . .yet Louverture insisted that he be court-martialed and shot.
  1. Don’t forget the small gestures. Napoleon’ failure to respond to requests for a letter led to a rupture with Louverture and the debacle of French invasion (force of 35,000 suffered 29,000+ casualties, including 15,000 dead of yellow fever and 5,000 in combat).
  1. His treatment by history. Was Louverture a sinner or a saint? Everyone sees what they want to see or history, as with beauty is in the eye of the beholder. Be aware of your preferences lest they become biases. Frederick Douglass in two speeches on same day he was a black George Washington who treated planters humanely (to white audience) or a Spartacus (to a black audience) evidencing “Negro manhood.”

Today we honor one of the ‘Trials of the Century’ from the 20th century, as on this day in 1925, the Scopes Monkey Trial ended with defense attorney Clarence Darrow giving one of his greatest closing arguments, asking for his client to be convicted so the case could be appealed. This tactic was just one of the trial strategies employed by Darrow to outmaneuver and humiliate the prosecution’s team. Denied the opportunity to bring in evidence of evolution into the trial, Darrow called William Jennings Bryan to the stand and in a wide-ranging cross examination, Bryan was subjected to severe ridicule and forced to make ignorant and contradictory statements to the amusement of the crowd. Bryan’s humiliation was so great that he literally ate himself to death in the week after the trial, dying on the 8th day.

I have long studied this trial and Darrow’s cross-examination of Bryan was one of the signature moments in trial lore. Darrow certainly had his fair share of unusual tactics in his legal career. Yet sometimes you need to have crazy ideas, whether you are a trial lawyer, a Chief Compliance Officer (CCO) or a business leader. I thought about this when reading a recent Corner Office column in the New York Times (NYT), entitled “Share Your Ideas, Even the Crazy Ones”, where Adam Bryant interviewed Joe Andrew, the Global Chairman of the international law firm Dentons. It was an excellent piece and had many lessons for the CCO.

Andrew began with a lesson on the difference between management and leadership, which he learned from his mother. He said, “She taught me early on the difference between management and leadership, which is about creating the circumstances for creativity. The people who become leaders are not just creative themselves, but they create circumstances for others to be creative.” Such creativity was expected in the Andrew’s household, as he noted, “in our household, questioning and being a rebel were expected. At the dinner table, she would ask, “What are you doing that’s creative? What have you created that you’re proud of, and that you think is fun and fascinating?””

Andrew took from this a passion to create opportunities for others, even when meeting a stranger, such as a cab driver. He learned from his mother to not ask “What do you do?” but rather “What are you doing?” and this question is about “What you are in the process of doing right now.” As a law firm leader, Andrew believes “The leader’s job is to create the ability for people to feel comfortable to share their thoughts and ideas, whatever crazy thoughts they might have. Their ability to be willing to express it is really important.”

This specifically includes people with ideas which might seem a bit off initially. Andrew said, “You have to identify and root out people who try to slam the door on creativity. You’ve got to be religious about communicating to someone that just because they’re smart, they shouldn’t be closing down conversations. The rules of this game are that you’re going to listen to others. My job is to convince them that despite all those things, they’ve still got to change. They’ve still got to be creative. They’ve got to be re-evaluating constantly and asking the tough questions.”

Equally important is to move away not only from the nay-sayers but from group-think as well. Andrew related, “You also have to constantly communicate the importance of creativity. That can be tough with professionals. Every single day, I go into a room of people who have succeeded since the day they graduated from kindergarten. They were the best in their class, they went to the very best schools, they do fantastically on standardized tests, they go to the best universities in the world, and they come out and make a lot of money.”

Unusual ideas can come from asking challenging questions. Andrew said, “Every day, I’m saying to people, don’t stop asking the tough questions. Because you’ve got to be challenged. And people have to be comfortable challenging you, and feel like they’re actually going to be rewarded by appropriately challenging you.”

Here I was drawn to the remarks in Matt Kelly’s interview of former Compliance Counsel Hui Chen, on his podcast Radical Compliance. Chen related that the Department of Justice (DOJ) Evaluation of Corporate Compliance Programs (Evaluation) document is designed to have CCOs and compliance professionals think about their compliance programs by asking questions. She explained, “Questions invite people to think. I like to call them evaluation questions. My goal is really to get people to really think about what they’re doing, what is the goal they’re trying to accomplish, how are they going to measure the results, how do they know it’s working. I’m a big fan of asking questions. The result of that, I’m hoping is that people really get to think about what they’re doing and why they’re doing it and how do they know that they’re successful at it.”

As a CCO, you will always have to be creative but the interview with Andrew drives home the leadership skill of using the creativity of others. This is both on your own internal compliance team but also in the other corporate disciplines which will operationalize your compliance program. Simply because an idea is ‘outside the box’ does not mean that it may not work better or be better suited for your own company’s risk management system. Andrew said that one of the key skills is that you must “be willing to try things that might fail.”

If you are a trial lawyer (or in my case a recovering trial lawyer) one of your heroes is Darrow who was not afraid to try crazy ideas and yes, he even lost a trial or two. As a CCO you have to be ready to persevere and move on, even if it means trying some crazy ideas every so often.

This publication contains general information only and is based on the experiences and research of the author. The author is not, by means of this publication, rendering business, legal advice, or other professional advice or services. This publication is not a substitute for such legal advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified legal advisor. The author, his affiliates, and related entities shall not be responsible for any loss sustained by any person or entity that relies on this publication. The Author gives his permission to link, post, distribute, or reference this article for any lawful purpose, provided attribution is made to the author. The author can be reached at tfox@tfoxlaw.com.

© Thomas R. Fox, 2017

In this episode, I consider the leadership lessons which can be drawn from our 7th President Andrew Jackson. I focus largely on the crisis surrounding the charter of the Second National Bank of the United States, which played out over 5 years from 1831 to 1836. This conflict pitted Jackson against most the nation’s political and financial elites, most prominently Nicolas Biddle, the President of the Bank. However, the great politicians of the day, including Henry Clay and Daniel Webster were lined up against President Jackson as well.

The crisis came to a head in the summer of 1832 when both the House and Senate passed a bill renewing the Charter of the Second Bank of the US early. Not only did Jackson veto the bill and give one of the most memorable veto addresses of any President, he then took on Biddle directly by removing first removing persons in the administration and government who were pro-Bank and pro-Biddle. In the coup de grace for the Bank, Jackson the gold species from the Bank and moving into state banks across the country. Jackson won the battle completely. His actions were not without negative consequence as the distribution of the species across the country led to rampant inflation and the Panic of 1837. However, by that time, Jackson had departed the Presidency and the fallout was left to his successor Martin Van Buren.

In this episode, I visit with Melanie Johnson, co-founder of Elite Online Publishing, which aids entrepreneurs, business leaders, and professional athletes to create, publish, and market their books, to build their business and brand. Melanie talks about her professional journey which led to this venture and how her career in broadcasting gave her a unique understanding for the world of online publishing. She discusses using your skills and passion to develop your own business and to build your own personal brand.