December 2007 Archive
December 10, 2007
This week's blog entry is reposted from the Harvard Business Review website.
The Red Cross announced on November 27 that the board of directors asked and received the resignation of CEO Mark W. Everson. The board made the announcement 10 days after learning that Mr. Everson had been in a personal relationship with a Red Cross employee. Mr. Everson acknowledged the relationship. According the Suzy C. DeFrancis, chief public affairs officer, the board "concluded that the situation reflected poor judgment on Mr. Everson's part and diminished his ability to lead the organization in the future." He had been the CEO for only six months.
Was this punishment too severe? Could the Red Cross have taken other measures such as a censure or a salary reduction? Could the CEO have remained to be an effective leader? After all, Mark Everson had performed extraordinarily well at his job. The dismissal was damaging and costly to both the CEO and to the Red Cross, which has had a hard time holding onto its leaders.
This situation raises an interesting ethical question. Where is the line that divides the public life and the private life of an individual?
Some might argue that this was a private affair that in no way affected either the CEO's or the Red Cross employee's performance. Had the relationship remained a secret and had the employee moved on and found another job, one may think that the CEO could have kept his job.
Others might say that the CEO -- or any leader -- is called to be a role model and should be expected to display exemplary conduct in both their private and public lives.
We do not know all the facts in this story, but here are some of the questions the board should (or maybe did) consider. These questions should be considered by management of any company when faced with an ethical lapse perpetrated by an employee.
- Did the individual violate the Code of Ethics of his organization?
- How has the organization dealt with similar situations in the past? Is management consistent?
- Did the individual come forward on his own initiative with the information of the activity in question or did the organization find out through a third party?
- What was the individual's attitude when his relationship became public? Was he apologetic or defensive?
- Did he have a prior history of such irresponsible conduct? In other words, was this a pattern of behavior or completely out of character?
The answers to these questions should help in determining the right course of action in such circumstances.
I believe the Red Cross made the right decision. Keeping Mr. Everson at the head of the Red Cross would have sent to wrong message to the staff and the public. They would be saying that such conduct is acceptable.
Furthermore, Mr. Everson did show poor judgment and therefore damaged his reputation as a leader.
Finally, I believe that it is fundamentally a question of character. Mr. Everson was a married man. How can someone who breaks a life-lasting promise and mostly likely lie about it be trusted? By his conduct he lost the respect and trust of his staff, the public, and donors.
Without trust it is impossible to lead.
December 17, 2007
The release of the Mitchell Report on enhanced performance drug use in baseball was front page of most newspapers last week. It seems that the whole country was "shocked."
The 400-page report based on more than 100,000 documents is a strong indictment against the practice of using steroids in sports.
Why the surprise? It was common knowledge that baseball players (and other athletes) use these dangerous and sometimes illegal drugs, to benefit their performance and careers, their managers, the team owners and the fans.
Tim Rutten in his article in the LA Times entitled "Baseball Shame is our Shame Too" says that everyone was involved "players, managers, coaches, owners, agents, lawyers, union officials, the majority of sportswriters and, even, the fans -- is complicit in all this. We've all turned a blind eye to what was there for anyone with eyes to see for the sake of profit and an entertaining spectacle."
The expression has an interesting origin. It is attributed to an incident in the life of Horatio Nelson, the Royal Navy commander who had one blind eye. In 1801, during the Napoleonic Wars, he was ordered by Admiral, Sir Hyde Parker, the commander of the Navy to withdraw from the battle of Copenhagen. At that time orders were given by flag signals. Eager to engage in the battle he raised his telescope to his blind eye and declared that he saw no signal to retreat and went forward and destroyed the Norwegian-Danish fleet.
Turning a blind eye, ignoring realities that we do not want to face is a normal human reaction as T.S. Eliot said: "Humankind cannot bear very much reality."
However it can have serious consequences in our work and personal lives. Many of the athletes named in the report have their reputation tainted and their records questioned. It takes courage to address a problem head on, but it is usually the only way in finding a solution.
Major League Baseball Commissioner Bud Selig did just that when he requested more than two years ago, that former Senator Mitchell conduct an investigation into steroids use in baseball and publish its results in a report. Now that he and the country have faced the problem he is entitled to say, as he did, "This report is a call to action, and I will act."
I am sure he will.