Corporate (un)Accountability

A Prison Scene by Francisco de Goya

Last week I had the opportunity to watch the phone-hacking committee hearing (carried out by the Culture, Media & Sports Committee, at the parliament, in London) and it made me ponder on the level of responsibility of a CEO or any other leader of a company.

The head of a small business manages a small operation with a low-numbered staff; therefore it is easy for him to know everything that goes on in his company and also to be held accountable for any wrongdoing.

The chairman of a medium-sized business already has quite a few number of people to whom he can delegate some of his responsibilities. Nevertheless, he is still quite capable of knowing what happens in his company and, thus, he too can still be held responsible for any business-mischievousness.
The president of a big business delegates the “burden” unto his managing directors, his financial managers, HR managers, Union managers, general managers etc; which could lead us into asking what on earth a president of a company does exactly.

A CEO of a corporation has, under his orders, a deputy CEO; a COO, a deputy COO; a CFO, a deputy CFO (he also has a president and a vice-president for each company the corporation owns, and sometimes a Pres. and a Vice-Pres. for each profitable department) and personal assistants, of course. Knowing that the COO is responsible for other directors and managers; and that the CFO, in turn, is the head of all financial managers; we can imagine how easy it must be for the CEO to shrug off any accountability for the corporation’s misdeeds. So, we could also wonder what the bloody hell a CEO does.

A president/CEO is like the parent of any business institution; meaning that (like a father/mother who is supposed to know, and is responsible for, everything going on inside its family – be it either small or large) any president/CEO, worthy of such epithet, should be aware of every single business operation and how those operations are carried out. For that reason, he should be held accountable for any corporate misdemeanour.

A company, a corporation or a holding should not be a free zone for unethical CEOs/presidents. Delegating responsibilities does not mean unaccountability. Au contraire: it signifies double-accountability since the head of the institution (or even department) selected the individual to whom duties were delegated.

It is quite disturbing when a leader, of any sort, stands before authorities and/or lawmakers and shamelessly states “I don’t know...I am not aware...I was betrayed by those entrusted!” particularly when his job is to know every single thing and every little detail.

Not knowing, not being aware of any given fact that led to the generation of millions, billions, of pounds/dollars/euros constitutes fraud; and fraudulent CEOs/presidents should take the responsibility for their incompetence and resign; and/or be incarcerated in order to reflect upon the ethics in Business Administration.