SENSEI LEADER workshops usually incorporate a discussion of our leadership assessment took, the SL 15+. One of the statements we designed to instigate thought and debate is: “Doing the right thing is always the most important consideration, even when it’s not profitable, expedient, popular or comfortable.” Responses can range from Strongly Agree to Strongly Disagree. As you might imagine, most people Agree or Strongly Agree that "doing the right thing” is always important. Sometimes, however, there is a dissenting voice. The SL 15+ is not designed to measure responses to a standard. The questions are meant to stimulate thinking and give us something to talk about. This gives us deeper insight into the self-perceptions of leaders in a particular organization and how their mindset works within the organization’s culture. Having said that, you’d think that this statement is about as right or wrong as you can get. Why would anyone think that doing the right thing is NOT the right thing to do? Wells Fargo… I haven’t conducted any workshops for Wells Fargo, though following their recent settlement over employee and management misconduct, I’ve had several people suggest they could use a good dose of SENSEI LEADERSHIP! According to CNNMoney.com:
“'Wells Fargo employees secretly opened unauthorized accounts to hit sales targets and receive bonuses,’ Richard Cordray, director of the Consumer Financial Protection Bureau, said in a statement.” According to reports, there was tremendous pressure put on employees from management to meet sales quotas. Meeting these goals became the right thing to do and was far more important the doing the right thing. How bad was it? Over 1.5 million unauthorized accounts… “The way it worked was that employees moved funds from customers' existing accounts into newly-created ones without their knowledge or consent, regulators say. The CFPB described this practice as "widespread." Customers were being charged for insufficient funds or overdraft fees -- because there wasn't enough money in their original accounts.” “Additionally, Wells Fargo employees also submitted applications for 565,443 credit card accounts without their customers' knowledge or consent. Roughly 14,000 of those accounts incurred over $400,000 in fees, including annual fees, interest charges and overdraft-protection fees.” This level of fraud seems unimaginable––and it’s going to cost Wells Fargo plenty. CNNMoney reports that in addition to about $5 million in restitution directly to affected customers, they’ll also pay $185 million in fines. How did it happen? "How does a bank that is supposed to have robust internal controls permit the creation of over a half-million dummy accounts?" asked (David) Vladeck, a Georgetown University law professor and former director of the Federal Trade Commission's Bureau of Consumer Protection. Wells Fargo’s culture became infected with this mindset of cheating and fraud––and the infection spread throughout the organization. In this diseased culture, “doing the right thing” meant meeting sales quotas––by whatever means necessary––including lying and defrauding customers. When participants in our workshops disagree with the statement that “Doing the right thing is always the most important consideration,” they’re usually saying that there are sometimes exceptions. Those exceptions usually have to do with acting against a stated or implied policy or cultural norm––even if that policy or norm is considered “the right thing to do” in that particular culture. Think about this problem in a larger ethical context. If you’re having to make exceptions, you’re probably not doing the right thing. That’s why we purposely specified that doing the right thing is always the most important consideration… …even when it’s not profitable, expedient, popular or comfortable. It’s not always easy to do the right thing, especially when profits, your job and your place in the organization culture are at stake. It’s particularly important that leaders at all levels prioritize doing the right thing––especially when it’s not “profitable, expedient, popular or comfortable.” The leaders at Wells Fargo did not honor this principle. They did what was right for them––at least in the short term, but lost site of “doing the right thing” in an ethical sense. Now they’re paying the price. They did fire about 5,000 employees in an attempt to cut out the infection. There’s more work to do. They need to instill the discipline of “doing the right thing” throughout their organization. They need to embed the value of doing the right thing even when it’s not profitable or comfortable. They need leadership at all levels so that from the front lines to the C-Suite, leaders will refuse to act unethically, even if the cultural pressure makes it seem the right thing to do at the time. If you know someone at Wells Fargo, please feel free to share this post! I know I can help!