New Zealand may consistently score first on Transparency International’s annual Corruption Perception Index, but it should not be complacent and could still aim higher, Professor Karin Lasthuizen said in her inaugural public lecture as Victoria University of Wellington’s Brian Picot Chair in Ethical Leadership.
“There are new risks to our integrity that we should not be naïve about,” Lasthuizen told her audience at Victoria Business School, where she is in the School of Management.
“Our geographical isolation might have helped New Zealand to create its own culture and good ethics, and it might have protected us for a long period of time, but this has changed – nowadays people can be here much faster and social media brings other worldviews within a mouse click.”
Other factors to consider range from increased international trade, “including doing business with more corrupt countries in the Asia-Pacific region”, to “new generations, like the millennials, [that] have a different outlook: what is considered ethical now is not the same as 20 years ago”.
Lasthuizen’s lecture was entitled ‘Leading for Integrity: Opportunities and Challenges for Ethical Leadership in Aotearoa New Zealand’ and drew on findings from interviews with 40 chief executives and other high-ranking figures she and colleagues conducted.
“In my view, we can become more aspirational than we are now,” said Lasthuizen. “And here I see an ethical leadership opportunity. We all know that the tone at the top in organisations is crucial and we are fortunate to have many leaders with strong integrity – within the public service, private firms, not-for-profit organisations and within our communities. By investing in ethical leadership, we can put ethics more explicitly on the agenda and raise the bar across sectors and organisations.”
Last year’s Auckland Transport bribery case showed that – “although we tend to be low in corruption and it doesn’t seem to be part of our culture” – New Zealand is certainly not corruption-free, she said.
Lasthuizen wondered if “there might be a general lack of awareness about the importance of ethics and what it brings us”.
She cited one of her interviewees, Financial Markets Authority chief executive Rob Everett, who said: “Ethical leadership is about ethics being very core to everything and not added on, and it’s about demonstrating those beliefs at every possible opportunity.”
“In many organisations, integrity management equals legal compliance and following rules, which is just a bottom-line approach,” said Lasthuizen. “Some things might be legal, but is it also ethical, the right thing to do?
“A values-based approach for integrity management seems to be more promising when it encourages us to talk about what good ethical behaviour looks like and to share good practices. Because we can only maintain our high integrity standards when we want to excel and do the right things all the time.”
Another interviewee, Jane Mitson, chief advisor of risk, assurance and integrity at the New Zealand Customs Service, told the research team: “I think the big challenges that we face really could be associated with small country syndrome.”
“What makes Wellington unique are the close connections between politics and the public, not-for-profit and private sectors,” said Lasthuizen. “Like many say, Wellington is ‘a small village’: everybody knows each other – within only two degrees of separation. Professional networks consist of strong ties and personal relationships. It creates a typical Kiwi culture of social cohesion, friendly people, easy interactions – and many catch-ups over coffee.
“The downside, however, is that in this micro cosmos the market of supply and demand is not optimal, and this increases the likelihood of conflicts of interest, intermingling of politics with the public service, nepotism in recruitment processes, and favouritism within work environments.”
Research, including by Victoria University of Wellington’s Centre for Labour, Employment and Work, suggests favouritism by managers – intended or not – can lead to workplace bullying and harassment, said Lasthuizen, adding that New Zealand has high rates of workplace bullying and harassment compared with other countries.
“The New Zealand Diversity Survey has shown that in 2017 more than a third of respondents identified bullying and harassment as a significant workplace issue.”
There is, she said, “a huge opportunity for ethical leadership to help create an ethical and healthy work climate, in which people feel safe to speak up to management – and if necessary against their superiors – about wrongdoing. This means, among other things, ethical leadership must tackle the conflict-avoidance and passive-aggressive work culture Kiwis often talk about.”
Elsewhere in her lecture, Lasthuizen highlighted an urgent need for a more diverse pool of leaders and managers, and connected ethical leadership to “our social responsibility for people and the planet and for future generations”.
Being low in corruption is not the same as being high on ethics, she said.
“Are we doing the right thing and making the most of it in terms of welfare and wellbeing for each and every one in our society?”
Lasthuizen’s ongoing research projects as Brian Picot Chair in Ethical Leadership include being New Zealand partner in the London Institute of Business Ethics’ global Ethics at Work survey.
“For this survey, 750 New Zealanders recently have been interviewed about ethical leadership and about their views about ethics issues at work. It is the first time New Zealand is part of this global research and this gives us the facts and figures about how we do and how we compare with other countries,” she said.
Before joining Victoria University of Wellington at the end of 2016, Lasthuizen was an associate professor within the Integrity of Governance research group at Vrije Universiteit Amsterdam in the Netherlands.
The Brian Picot Chair is named for a business leader who made his mark as director of major supermarket company Progressive Enterprises and several other companies.
Picot, who was known for his strong sense of ethics and concern for others, died in 2012.
Professor Lasthuizen’s lecture can be viewed here.
See also: Why ‘speaking up’ is good for business.