SanLu Chairwoman Tian Wenhua was sentenced today to life in a Chinese prison, and two of her suppliers were sentenced to death for their part in melamine contamination cases. According to the China Daily, Tian “was convicted for her failure to stop producing and selling milk products even after she was informed that they were contaminated. She was fined about 25 million yuan (US$3.7 million), too.”
We’re fond talking about how a director’s primary responsibility is to act in the best interests of the company (Section 131 of the Companies Act), and it goes without saying that a director must not break any laws while exercising their responsibility.
But I’m left wondering if it might not be prudent to be more specific in the Companies Act about the company’s relationship to its consumers and the general public.
In any case, it would be good for company directors to specifically acknowledge their responsibilities as part of their induction process. Speaking the words of a public promise, with witnesses, that one can easily recall, sharpens the focus and would encourage better self-awareness of a director’s actions, as well as promoting public accountability.
I propose the following “Hippocratic Oath” for company directors:
In the exercise of my duties as a company director:
I will not deliberately harm our shareholders, other directors, company staff, our suppliers, customers, end-users, or members of the public.
I will always act within the law, and ensure that the company acts within the law. Where I am unsure of the law, I will seek professional advice.
I commit to act in the best interests of the company, ensure that the company meets its obligations, and strive to make the company responsibly successful in achieving the strategy that is collectively set by the Board.
I will not seek to derive unfair personal gain from any transactions with the company or its personnel.
I will communicate clearly in a respectful and professional manner with my colleagues, being diligent and timely in my record keeping and reporting.
I will model behaviour as a director that I would expect from any company personnel.
I will not betray the confidentiality of information that has been properly given to me in confidence, nor will I seek personal gain from such information. Likewise, I will disclose without hesitation any information that that is required to be made available to government agencies, other directors, stakeholders, or the general public.
What do you think?
1 comment so far ↓
Your thoughts and approach are resonating. That led me to this rambling. If globalization and the wiring of the world are flattening everything, then the old barriers we as business people had to rely on are disappearing. National boundaries, economic hurdles, even the notion of distance as a tool are going away. With these are many of the defenses we had for our actions of the past, national security, economic advantage, and sovereignty all are flattened when I push the send button to pass this on to you. Yet we, as members of the human race, must still live as moral and ethical people that provide mutual security and safety to all in our village.
My mind goes back to Rousseau, Adam Smith, and the other ‘rebel thinkers’ who made it clear that freedom, particularly economic freedom requires each practitioner to be both morally and ethically responsible for their actions and the collective action of the community. If this did not happen, these ‘rebel thinkers’ believed in the necessity of government to impose that moral and ethical hurdle so that all must clear so that everyone in the society was secure, safe, and free. I interpret this in your oath as I was taught to understand the this series of choices beginning with choosing to embraced the status quo or to embrace change. I choose the latter. We must be always adapting and inspecting what we do to make sure that it results in the most benefit and that we are striving to change what we offer to better meet societies needs and desires – within the morals and ethics of our tribe. This is not some veiled notion of religion, no matter how much you or I or anyone believe in our faith. This simply is recognizing that the moral and the ethical choice is to do no harm to anything that encourages a better future to one and all. I will stop here as I have unfinished thoughts beyond this point. But in stopping, I see the need for directors and boards to advocate change, embrace risk, and reward courage as these are what make transparent the morals of a man and the ethics of a tribe. Thank you again for pushing my grey cells around.
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