Marc Le Menestrel

Can we prevent Policy Capture? Reflections about Public Interest in Business Decision-Making

Marc Le Menestrel — 2017-04-04T10:42:38Z

On March 30-31, I was invited to the OECD Global Anti-Corruption & Integrity Forum in Paris. I had prepared the following short piece to reflect on the theme of our panel: Policy Capture. Thanks to the wonderful colleagues at the panel and the moderator, the conversation took an unexpected turn, promoting intellectual honesty and emotional maturity. I was thrilled to feel the audience, during and after the panel, engaged in tackling these difficult subjects in a smart way, from the heart and inspired.

To benefit public interest while pursuing business interest is one of the greatest challenges of business decision-makers. For business actors, aligning the private and the public, the personal and the professional, the ethical and the profitable represent an ideal that all want to attain. For policy makers, sustaining such alignments and providing the conditions of their manifestation lie as at the source of their vocation. We as humans are all capable of thinking of ourselves and beyond ourselves, and our happiness is closely related with our capability to act both in our name and in the name of others.

And it is interesting to think that our ethical vulnerabilities, the mark of our experience around failing to combine our individual and collective motivations in an ideal way, are actually one of our core characteristics. Although everything lies in everything as a whole, we know that most of the time we are entrenched in one or the other of our motivations and sacrifice the other.

As human decision-makers, we must learn to live at the frontier of ourselves, the place where a line is drawn in the gray zone. Whenever
Our ability to think, to communicate and to act at the frontier of business and public interest may in fact be one of the most important skills to face our human future. In some circumstances, business interests indeed collide with policy making aimed at public interest. To some extent, these situations question the very idea of democracy and market economy promoted by the OECD.

Consider the following examples extracted from my recent research and assignments:

Whenever the demand for fossil fuels grow, their price tends to remain high, leading to sustainable profits for extracting companies. So from this point of view, public policies aimed at promoting demand for fossil fuels are of the industry interest. On the other hand, they are not in the interest of reducing the consumption of fossil fuels.

The Chief Scientist of a technology company receives early warning signals about the hazardous character of an advanced solution. He is having dinner with a former senior executives now working in the corresponding government agency. How could the regulatory dynamics be evoked?

As a policy to reduce the incidence of some particular health issue is publicly discussed, a pharmaceutical company that sells drugs treating affected patients ponders on its lobbying strategy: should this policy be delayed?

As a candidate for national elections advocates peace and partnership with a traditional enemy, the chairman of a defence contractor is reflecting on whether they should stop to finance the party of the candidate: is peace genuinely desirable to all?

These examples are typical of business ethical dilemmas where a business actor faces a decision that either favours his/her/its expected interest or the perceived general interest. Should one strictly apply the idea that the responsibility of business is to maximize profits, a decision against public interest would be prescribed. Business actors thus have the temptation to enter into “political activities” that influence policy makers against public interest (See our discussion with Julian Rode about Why Business fails to listen to Early Warning Signals about technological hazards).

In my experience of the classroom, it is undeniable that business actors are tempted to engage in actions that capture public interest. And of course they sometimes do it. It is also interesting to note that they don't like it and are capable of perceiving the ethical issues that lie behind.

Lobbying, revolving doors, political party financing, and more structurally market commoditization of violence or of drugs or confidentiality of technological innovation are certainly not only good, they also have a dark side. The difficulty to speak about these dilemmas openly is a mere proof of the emotional difficulty that we face in admitting our guilt, our shame or our fear in the ultimate consequences of such practices.

In my experience, it is close to be a systematic opinion among business executives that the current dynamics is unsustainable. There is an obvious truth in the consideration that incentives can orient business behaviours against public interest. As a result, another temptation appears, and in particular among policy makers, which is to condemn these behaviours and their actors as “corrupted”. Corruption becomes the “evil” that ruins the world and we should fight against corruption as a priority. We constitute two categories: good and bad actors and we divide ourselves once again, “us” in the good category, “them” in the bad.

If, as advocated in the OECD introduction to the issue of policy capture, citizens reject the current system that does not serve them, politicians must be corrupted for the system to sustain. There would be therefore no genuine fight against corruption without questioning the system. Moreover, not questioning the system would be a signal that no genuine effort against corruption is truly implemented. We would be once again in a game of words and the anti-corruption discourse takes the risk of a cynical and hypocritical intention.

To which extent OECD questions the system in which it plays a role? And if we take OECD core values as a concrete translation of what “system” means, the question therefore is:

Does OECD question, for instance, the search of economic growth as a political priority? Representative democracy as a political system? Or the extension of market capitalism?

These values are in fact at the core of an ideology that is not perfect and should not be advocated as such. Opening a constructive communicational space to discuss the frontier of these ideas is a must for tackling the issue of policy capture in a credible way.

Market capitalism has ensured the institutionalisation of an economic licence to operate for companies. However, democratic structures are attaining their limits at managing their political licence to operate. One may find the reasons for this in the transnational nature of the economic and financial power of business actors, a power that outmatches the national sovereignty of western democracies. Also, the aggregation of specific business interest creates suboptimal collective outcomes that threaten the welfare of the citizens as well as the ability of human societies to live in their natural environment.

If the distinction between business interest and public interest is not new, the current global situation calls for a new way of drawing the line in these grey zones. As a professor of Decision Making, teaching to business decisions makers and from time to time to policy-makers, I have been advocating and developing tools and methods to tackle business ethical dilemmas like to ones evoked above. It is with precaution that I share three skills that emerge from this experience:

Principle 1: Shadow and Light

Each decision-maker can train his/her/its ability to see the shadows casted by his/her/its own interest and hidden by his own moral justifications. One should be able to understand why one's own interest is in itself problematic and does not only include desirable features. There is a need for a systematic analysis of the ethical dimension of business actions. And it is interesting to note that such an analysis requires suspending our judgement so as not to analyze only what supports it, which should be seen as a prejudice. The courage to face one's own shadows helps to draw the line with less violence, towards others and also towards oneself. It also reduces bad faith argumentations where supposedly win-win approaches are mainly the result of impression management and cover up more important issues.

Principle 2: Dilemmas and Win-Win

Each decision-maker can develop his agility in navigating to see both sides of the frontier separating different interests. Of course, one should be able to understand the interest from one's point of view and from the others' point of view. It is then possible to formulate more precisely the dilemmas and the conflicts of interests, which are somehow always present. It is indeed interesting to note that not all win-win are genuine. As it is always possible to do better from the moral point of view, there is always somewhere a line to be drawn. Whether this is done in full conscience and in the respect of the sacrifices that it entails is a major skill to work out. And when, making the difficult choice of what is good for all, we end up discovering good surprises that are also in our private interest, thse win-win are a most formidable reward.

Principle 3: Collective Dream

Decision-makers benefit from being invited to formulate an ideal solution. The power of dreams allows us to think beyond specific objectives. We should not limit our vision of the future and our conversations to what we think we can do. In fact, we need to create the conditions for emerging solutions to surprise us for the better and this is mostly happening in appropriate collective communicational settings.

Today, and especially in developed countries, it is my impression that the context favours business interest more than public interest in critical issues. This is detrimental to the harmonious development of societies. I thus concur with the intention to preserve public interest from business decision making. In line with the principle above, I am however reluctant to promote any confrontational way. The situation requires us to move to the next level and bring these dilemmas as the main subject of discussion. In this spirit, I suggest three directions for considerations:

Business actors, be them companies, associations, lobbyists, individuals, should be invited to take positions in front of these dilemmas. As these positions affect the public interest, they should be public. As they affect their business interest, they should be included in their reporting. This should promote proactive business behaviours and create advantages for those who consider public actors their allies. It should be respectful of the immense difficulty for some actors to take a position.

Policies as normative and prescriptive solutions may prevent our ability to invent new ways to combine business decisions and policy-making by trapping us in advocacy. We should learn to express without violence or judgement the main dilemmas that business decision-makers face at the frontier of business and public interest. Formulating and releasing to the public space such dilemmas in an objective manner, for example industry by industry will increase our capabilities to face the challenge our societies face.

Business and policy-makers should gather in forums to build ideal solutions to the tensions inherent to the combination of national democracy and transnational market capitalism in the age of globalization. Beyond the market, there is a need for spaces where digital capabilities allow participative approaches to complement political representation. That would also help to harness the growing demand of citizens for a harmonious development, beyond profit maximization of companies and national economic growth.

Angola: Searching for a new Spirit by Looking at the bright side

Marc Le Menestrel — 2016-12-08T04:44:18Z

December 2nd, 2016 was a historical day for Angola. Not because I was invited to speak at a conference on Corporate Governance in Luanda but because this is the day President dos Santos decided not to present himself to the coming elections. After nearly 40 years with him, Angola is in search of a new Spirit. I looked at it from the bright side.

And this is not necessarily easy. As Angola was to access independence from the Portuguese at the end of one of the most sombre European dictatorship of the 20th century, Angola was also discovered to be the bed of a great amount of oil. Under sea, yes; expansive to extract, yes; but of excellent quality. And as Angola is nowadays the largest oil producer of oil in Africa, it has also been the victim of the fall of oil prices in the last years. To be sincere, it has somehow been the victim of oil since its discovery: the famous Dutch disease or Oil Curse that characterized countries which rely too much on the sole wealth of oil to drive their development. But I said I was looking at the bright side. So the question is: how oil can help to nurture a new bright spirit for Angola? I witnessed the strong belief that it should not be through violence. Everyone wants to forget the bloody civil war and build on the stability which followed by the victory of future ex-President, his army and his party. I sincerely hope that the days ahead will allow the national forces to hold the ground and protect the country. With slightly rising oil prices, and a global momentum to move away from a carbon-based economy, there is a great chance to have the right amount of added value from oil to support a diversification. It was especially interesting to learn at the conference how people there dream of self-sufficiency in basic sectors such as agriculture, textile or raw material for construction. In Angola, globalization may not preclude autonomy.

A second most important question was also very much related to the global dynamics of the time: under which conditions banks can help finance this transition? If the dedication of Angola banks seemed sincere and competent, the question arises from correspondent banks that can ensure the connection of Angola's economy with the rest of the financial world. In our discussions, the power of the mighty dollar system was very much felt: as the given currency for oil of course (oil represents 95% of exports), but also through the norms pertaining to transactions and governance. Angola is asked (forced?) to adopt the accounting standards of the United States. And it is interesting to note that such exercise of power uses ethics and anti-corruption efforts as a means. Sensitive to this dynamics, and to the emotions felt by a country so proud of its political independences after a long-fought battle, it is not obvious to find a bright way out. There is however no other solution than taking the best of all systems. As Deng Xiaoping said (around the time Dos Santos came into power!), capitalism and communism are two ways to serve the welfare of the people. There is no need to oppose ideologies and there are many smart ways to combine them in order to avoid the worse of each. Angola may fiercely come to terms with practices that now belong to the past and it may do so without selling its soul.

To this end, the obvious bright side of Angola is the proud richness of its people and of its grounds -be it off shore or for agriculture. We dreamed of them leap-frogging to a green and circular economy that uses wisely the new conscience of our unsustainability. Besides the wise men who founded the economic successes of the country over the past 15 years, it was wonderful to meet a new generation of Angola people proud of their roots and farseeing in their visions. The unity provided by Portuguese as a language spoken all over the country is certainly a resource. Moreover, it seems that Portuguese themselves, who were very present at the conference, and expatriates in general, are grateful for the wealth Angola provide to their business or to their home country. In the difficult circumstances of the time, there is an obligation and an opportunity for a win-win post-colonial relation, based on a sense of care for the country itself and for its promises. The question is thus whether these Angola leaders will dare to invent their future on their own terms under the pressure of external conditions, be them coming from other nations or from nature itself.

This is in this context that I deliver my speech on governance as the wise use of power. Treating the global level as well as the corporate and the personal levels, I proposed three principles for the wise use of power.

Firstly, a principle for the mind that I termed duality. As the mind naturally thinks in classes and value-judgement, I invited participants to make the effort to think contrarily to their natural categories and to their prejudices. As Hermann Hesse wrote in Siddharta, “the contrary to any truth can be as true as the truth itself”. It is thus necessary to suspend judgments and apply critical thinking to our natural thoughts, beliefs and methods.

Secondly, a principle for the heart that is certainly called love. The mind can be treacherous to motivate us and there is nothing better than doing what we love to do it sustainably and with courage. Moreover, being able to accept our vulnerabilities helps to have the emotional maturity to thing broadly and creatively.

Thirdly, a principle for the soul that I called dreams. In a time of disruptive uncertainty, dreams can be like a light house in the storm. We do not necessarily head straight towards them, not even reach them exactly, but they offer an irreplaceable sense of guidance for our vision. Dreams help to avoid the many traps that direct routes hide below the surface.

It is with a sense of achievement that INSEAD organizers concluded the conference. There is a genuine opportunity for such events which allow conversations to take place beyond polemics and prejudices. An academic approach combined with a strong sense of relations in the respect of diversity, all with a superb organization, offer a bowl of fresh air in today's difficulties. In such conferences, the brilliance of INSEAD alumni prove that INSEAD is a business school for the world and it was indeed my privilege to be part of it. I wish Angola, its people and its Alumni to find a bright new spirit for the days ahead.

Gaïa @ Rocklands: A Dream Project

Marc Le Menestrel — 2016-10-18T16:56:15Z

My first visit to Rocklands in South Africa in 2014 was a calling.
From the rock art of our ancestors the San people, I felt African for the first time.
Guest to some beautiful wine farm in Stellenbosch, I felt white. Forgiven by the blessing of Madiba, I felt in need of redemption.
And it is among the boulders of Rocklands that I knew how deeply I was a climber.
I dreamed of discovering my self and its shadows in this eternal landscape and in this society of social transformation.

To lose yourself in the Rocklands landscape is to find a path within Gaïa

Serendipity offered the opportunity to push forward a partnership between INSEAD in Fontainebleau and the University of Stellenbosch. This led to the African Directors Program and its leading-edge intention to train directors in a vision of business at the service of ethics, responsibility and sustainability. It was also the occasion for me to try a new relation to money: I would dedicate my fees to some social project in the country.

The San our First People

The San, our First People

From there, my intention would help me to meet people. I entered into conversations about what could be done. Climbing grows at a rate of at least 20% each year in Rocklands, bringing tourists of a special type. Climbers stay for a much longer time than flowers' lovers, cherish the wilderness like Bushmen and like to bond with local people. Even for the farms where crops remain the main source of revenues, climbing disrupts the social dynamics.

Alas, willing to “do something”, most of my ideas and the ones generated with these discussions were inappropriate. They were an opportunity to take conscience of my prejudices. I needed to clean my mind to let the dream take its own shape. I needed to heal my soul to let the dream have a life on its own. I needed to be ready not to do anything so as to perceive a form of energy independent of my self.

While visiting the Sustainability Institute in Stellenbosch with my co-director Arnold Smit and my friend Desiré Gird, I thought of my soul brother Txema Gomez and his idea to build boulders for outdoor climbing. We then pursued this in Barcelona and Txema, seduced by the idea, proposed to build Gaïa for Rocklands. He had built the first Gaïa has a self-present for his 50th anniversary and it had a very special meaning to him (see his song below).

Txema Gomez, climber, poet, composer, Gaia builder... Here in Rocklands (photo James Frost)

I came for 2 months mi-July 2016 and things then began to flow. My local friends Charité, Becky and James all pointed to JP and Tracy who I had met the year before. That night, we spoke a lot about Indaba and the spirit of the Bantu people, the power of the landscape and the tragedy of the San people. That week, the climbing school they were animating received so much gifts that JP and Tracy decided to hand over to Elizabeth Fontain, the local primary school. All sign pointing in the same direction, they said we should build Gaïa there.

The Small World (Gaia Boulder)

Since I couldn't fix the world

I built a new one

For me and for dreamers

Some say I am a fool

And I agree with them

It is my own protection

Homage from my heart

It cannot contain my tears

Witnessing so much pain

Turn, turn my small world

The climber becomes stronger

In the end it is just a game

Beware climbers

At the location of New York

There is a tricky move

Hold on and pull hard

Keep breathing

You will make a virtuous jump

It is the magic of this boulder

When each revolution

Is at the service of joy.

Txema Gomez

The day Txema arrived from Europe, the school was running its annual Climbers' party and Annatjie Domus, its headmistress, was already announcing the welcoming of Gaïa at the school! Unio Joubert, a climber, had joined the school a few weeks before and would become a most inspiring and supporting fellow. Thanks to Charité's husband Edu and her mother Effie, Dr Strauss accepted to lend us a workshop close to the school. Thys and Marc from De Pakhuis were eager to help lending us the necessary tols. I found help in the local suppliers to order the fibreglass, the resin and the rest of the material.

Painting Gaïa (photo Scott Noy)

The building of Gaïa itself took less than 3 weeks. From the start, James Frost joined the team and became Txema's first acolyte. Lisa, Clara, Scott and Kaddi, Jim and Elmar were helping in a thousand ways and especially to draw a beautiful map of the earth on the ball. The children would come to visit from time to time until we brought the ball to the school. We had no holds and found a great help from Citirocksthrough its founder Robert Breyer and Metoliuswho agreed to contribute as a sponsor. Gecko Grips also agreed to make a special price for us and I contacted Mike Behr who was willing to help by giving holds. Everyone wanted to help the success of Gaïa.

Gaïa Spirit

The end of the construction was the beginning of the work of Gaïa itself. It is as if Gaïa was a spirit guiding the whole project, finding its way among the people and taking form in the material world. We wrote the two phrases Txema and I had selected: “Each turn heals – It is a game” on the South pole.

The Gaia Ball

Gaia (Mother Earth) Ball is the brainchild of Catalonian climber and master builder Txema Gomez. The project was funded and spearheaded by Marc Le Menestrel a French climber and sustainable business expert. The message from the ball “healing each turn” and “it's a game” is an open invitation for movement by climbing on the ball. The speed of the rotation is controlled by a rope-brake system that can also be fixed to create a static climbing device.
This project will allow learners to climb on only the second of its kind rotating climbing globe and we believe develop both cognitive and physiological life skills. By moving on the Gaia ball problem solving will enable learners to learn how to regulate and control their bodies and minds. Self-regulation is thus taught and the hope is that our learners will in the future be able to use this amazing tool independently and without adult supervision.
This project is part of a larger drive by organizations such as the Rocklands Rangers to develop and promote climbing within the local community of the Agter Pakhuis area. The future growth of climbing we feel can only help healing in our school and community.-Thank you to all the hands that helped to build and erect this new fun learning solution.

Unio Joubert
A link to Unio Joubert's account of Gaïa on CLIMB ZA

With Gaïa, I have learned to lead a dream project with the spirits, in the flow and at the service of some energy for social transformation. I felt the magic of life and I felt the healing very much, and in particular for the white man in me. Healing was happening to others I guess, even if it is always very difficult to judge from outside. And sometimes healing takes time and goes through phases. What was obvious was the joy of the kids climbing Gaïa after school or during their Physical Education class. I hope the images and videos pay tribute to this.

Thanks for helping Gaïa

Txema – James - Gim Huay - Lisa - Clara - Scott and Kaddi - Jim - Elmar - Desiré - Becky and James - Lizzie and Connie - JP and Tracy - Charité and Edu - Dr Strauss and Effie - Thys and Marc - Unio and Annatjie – Arnold - Lauren – Mike – Robert - Brooke – Kurt - Jaco

Reflections on Governance and the Africa Directors Program: at the forefront of responsible board practice?

Marc Le Menestrel — 2016-02-28T10:28:02Z

I wrote this short piece as a Reflection Paper for the Newsletter of the INSEAD Corporate Governance Initiative. It illustrates my commitment towards the transformation of business governance and the profound impact that South Africa has on my reflections about who I am: descending from African ancestors and man of white skin.

When INSEAD Corporate Governance Initiative accepted the invitation of the University of Stellenbosch Business School and their Executive Education branch USB-ED to partner in the offering of the Africa Directors Programme, I was especially interested in the programme's intention to bring ethics at the centre of the governance discussion and practice.

Crises of many types are currently raising new challenges for business organizations. In a context where capitalism is being questioned in its foundations, improved governance has emerged as one response and a critical issue for the credibility of the whole system. A new paradigm is emerging where business and boards have a new and more active role to play, where responsibility and power are two keys going together. This includes a shift towards a stakeholder view of boards, away from the previous shareholder view which is now recognized as having imposed too many negative externalities on other stakeholders (employees, bondholders, communities, governments and the environment).

South Africa at the leading edge of governance for social transformation

In this respect, it is remarkable that South Africa plays a leading role in the current discussion about corporate governance. As part of the post-apartheid transition led by Nelson Mandela's arrival to political power, a committee on corporate governance was constituted in 1993. Chaired by retired Supreme Court of South Africa judge Mervyn E. King, the “King Committee on Corporate Governance” has produced a series of reports over the last 20 years - the “King Reports”- that apply to all listed companies in South Africa.

It is important to understand that the political changes of the post-apartheid South Africa is one more instance of what is a profound transition, one that goes much deeper than the already complex change of political and economic dominance from white to black ownership. As program co-director Arnold Smit taught me, the King Commission was about designing a corporate governance framework that would be able to mirror the values of a progressive constitution, one that would match the new democratic dispensation and one that should guide the rebalancing of South Africa's economic and business landscape to make it fairer and more inclusive for all the country's citizens. As it faces this challenge, South Africa is an important point of focus and even a source of inspiration for the wider transformation of our societies.

Leadership, sustainability and good corporate governance citizenship are at the core of this new vision for governance. The King committee has brought South Africa at the leading edge of the discussion about corporate governance, heralding a different approach, for example, than that which Sarbanes and Oxley have advocated for the U.S.. The latter does not question the supremacy of shareholders, and has instead focused on a greater ability of detecting responsibility for value destruction and in particular fraud. This is mainly because SOX came as a legislative response to the big fraud cases of the 90's and early 2000's (WorldCom, Enron, Tyco …).

The South African approach has to be applauded and has indeed been recognized. It certainly has increased the perception of a greater effectiveness of South African boards. For instance, South Africa ranked #3 in board efficacy according to the Davos World Forum Global Competitiveness ranking.

In this program for African Directors, we are of course guided by the King Reports, which are an inspiration to identify and discuss key principles that could be implemented all over the African continent, a context that offers a broad range of worldviews and business systems. Especially, we allow stakeholders to take a prominent position when conceptualizing the role of corporations. It is held explicitly that business organizations shall be governed in a sustainable manner and for the benefit of society as a whole. This view goes well beyond the primacy of shareholders model and brings new perspectives to the governance conversation. It acknowledges the un-sustainability of the shareholder view and considers that, for business to exist in the future, it has to pay greater attention to human values, ethics, social justice and environmental sustainability. This rejoins the idea that greater performance arises when looking not narrowly at profitability, but also considering social and environmental impacts like in the “Profit, People, Planet” framework. In a sense, this program is one of the first in the world that is strongly built on such a transformative paradigm.

Developing a Capacity for Directors to Use Power Responsibly

In terms of pedagogical intention, the program aims at building capacity of directors for the contribution of business governance towards societal transformation. When we go to the details, it is crucial to realize that, ultimately, governance is very much about the responsible and irresponsible use of power. Thus, building capacity in governance is about developing effective uses of power that contribute to effective corporate transformation, and ultimately beneficial societal transformation. The creation of business value is not an end in itself but a means towards a greater end: the transition to a more cohesive, just and sustainable society. Business rationality is reversed: society is not used as a means to profits but profits are a means to a greater purpose which is to benefit society in the respect of environmental impacts.

Responsible uses of power give meaning to power and the program intends to give meaning to the power of boards. Rather than top down lectures, this is achieved through facilitated conversations: conversations amongst business, political and social actors, conversations across business actors, conversations at board level with employees and stakeholders, conversations preparing these boards which ultimately require deep conversations amongst board members and finally conversations within each board member. In this program, we enter into conversations that give meaning to the use of power in business governance and that prepare board members for the responsible use of power for the benefit of corporations and their positive impact on “people and planet.”

As the world is undertaking a profound transformation on its own sustainability, it is critical that business governance develops a language that allows conversations about the use of board power and its impact on profits, but also people and planet. As a result, this program is unique in its ambition to discuss the broad extent of the power of corporations on their environment.

As an outcome of the program, participants become empowered to give new meaning to their contribution to the boards they chair or sit in. For instance, they find new ways to empower their boards to tackle issues of risks – where excessive risks often lead to fraud and then corruption. Resisting the temptation of excessive or unwarranted risk, and then fraud, and ultimately corruption is thus a novel manner to preserve the value creation of an organization. As my mentor Ludo Van Der Heyden puts it, value preservation more than value creation is the most important responsibility of boards. It is also an opportunity to enter into a new meaning for the role of board members, and through them, of business in society. It is an opportunity that promotes strategies that are based on sustainability and justice. By proposing a language that overcomes the narrow mindset of shareholders profit maximization, we open a space that gives business a greater purpose and a more positive contribution to society and its ongoing and necessary transformation.

Enlightened Power and Ethical Shadows

Going deeper into the theoretical realm, the articulation of governance has been traditionally approached either about interests (how to further the interest of a particular actor, how to coordinate interest of different actors), either about ethics (how to constrain interest by ethical principles, norms and rules). The reality is richer and more complex because it must articulate both.
Governance is about the smart articulation of both interests and ethics. A fundamental principle of this articulation of a bias that characterizes us all: each of us are very good to perceive, think and communicate about the ethical side of our own interests and, conversely, to see and communicate the unethical sides of the interest and actions of the other actors. There is generally very little awareness of our own shadows, while there remains a very strong bias against those who may judge us or infringe our particular interests. This bias creates a sort of tiny corridor where one thinks about ethics, focusing only on one's own interest like the light at the end of the corridor. A main objective of the program is to empower participants to be free from that sort of ethical bias, if not blindness, i.e. to bring light to our own ethical shadows. That is the challenge that needs to be overcome to allow for deeper societal and thus ethical discussions at board level.

The word ethics has been used a lot, so much so that in many quarters it leads to dubious or even cynical reactions. We indeed believe that it should be understood in the presence of another notion: enlightened power. Through the use of carefully designed and facilitated processes, such as a cognitive, emotional and shall we dare say a spiritual awareness of our and our corporation's negative and harmful shadows, we can liberate that enlightened power from having dared to bring new light to our shadows. In the program, the harnessing of directors' enlightened power increases capacity of participants 1) to be free to think strategically about a wider range of opportunities for action and vision, 2) to be emotionally more mature to fully hear and understand the hidden risks of strategies that oppose legitimate interests, so as to combine them better in resolutions that are more satisfactory to stakeholders 3) to enter into board dynamics that leverage the grey zones of interests and ethics in an inspirational manner.
As a result, and as a final comment, this program is not just about governance for social transformation. It also becomes an opportunity for personal transformation. A transformation that equips us with a way to talk about some of the most pressing issues that capitalism face today in Africa and beyond, one that gives us the language to find meaning in our professional life and experiences as a director so as to truly become actors building and contributing to a better world.

As directors become leaders of their organizations, and even enlightened leaders, they integrate the changes and new mindsets their corporations need to acquire by anticipating, integrating, living and being the change before leading, inspiring, supervising it on the others, and particularly on the corporation. Isn't this leading a responsible and new view of the board?

Marc Le Menestrel
Co-Director of the African Director program

How to help business actors to apply the Precautionary Principle?

Marc Le Menestrel — 2013-01-25T18:40:04Z

On Wednesday 25th of January, I was part of the EEA delegation who launched the second volume of Late lessons from early warnings: science, precaution, innovation at the European Parliament (see my former entry in April 2012 here)

Jacqueline McGlade, Corinne Lepage and Sybille van den Hove during the Press Conference

The delegation presented the report to Green Ten (a group of NGOs acting at the EU level), to the European Parliament, to the DG Environment and to Friends of Europe.

The general message of the report is that early warning signals of a technological risk for the environment or human health are often ignored and even supressed, thereby leading to negative consequences that could have been avoided by early action.

Because business actors often play an important role in developing and applying these risky technologies, it is important to understand why did business not respond with precaution to these early warning signals.

This is the question that our chapter "Why did business not react with precaution to early warnings?" with Julian Rode attempts to answer on the basis of published academic literature. Without much surprise, we find that economic motives are often driving non-precautionary decisions. However, these decisions are also influenced by a complex mix of epistemological, regulatory, cultural, and psychological aspects.

Clearly, the interest of our work is to lay ground for more advanced and constructive findings. In particular, I am especially interested in the concrete application of the precautionary principle by business actors. To this end, my impression is that there is still much to add to the current debates. For instance:

– the legal definition of the precautionary principle is open to interpretation. Understanding these interpretations require us to understand the ethical issues that lie beyond;

– we can neither be totally free nor totally precautionous. In practice, we need to draw a line in the grey zone. To some extent, this is what each one of us do every day. What I find interesting is to understand and improve how this line is drawn;

– prima facie, business actors often face a dilemma between profits and precaution. For the use of precaution to be profitable, much work is necessary. Technological risks, when they involve the environment and the public, are a specific case of ethical risks. Clearly, identification, mitigation and transformation of ethical risks is not easy. This is a major challenge for ethical training;

– the profoundly difficult dilemmas facing business actors must be acknowledged and spelled out, in order for the debates to gain constructiveness and not be lost in ethical ambiguity. As I attempt to teach to Master students, companies should clarify for themselves what profits they would forgo for precautionary reasons and with which managerial process they would make such decisions.

Of course, there is much to work out, but the idea is to promote intellectual courage and honesty so that we can create and develop trust. For instance, imagine a business actor saying

"we want to be precautionous but we cannot always be because it would cost us too much. Hence, we have to draw the line somewhere. This is the part that we are ready to pay for. Clearly, we can't solve the issue alone. We need help and support from all stakeholders to move this line further towards sustainability."

Would you help business to apply the precautionary principle?

Related Pieces on this website:

Thinking Ethics as a Grey Zone

Ethical Risks: Identification, Mitigation and Transformation through Ethical Training

A related piece on the excellent Vivagora website (in French):

Les dilemmes de l'innovation : pourquoi est-elle peu ou pas responsable ?, by J.J. Perrier, Vivagora.

Late Lessons from Early Warnings: Why did industry not respond with precaution?

Marc Le Menestrel — 2012-04-19T10:18:05Z

On April 19th, 2012, the European Environmental Agency pre-launched the second volume of Late Lessons from Early Warnings.

This event follows the famous Environmental issue report No 22/2001 Late lessons from early warnings: the precautionary principle 1896-2000 which gathered available scientific information about the hazards of human economic activities and its use in taking action to better protect both the environment and the health of the species and ecosystems that are dependent on it, and then living with the consequences.

Like the first report, the second report is based on case studies and brings together experts in their particular field of environmental, occupational and consumer hazards.

With Julian Rode, we contributed to an article about the specific role of business actors in failing to respond with precaution to Early Warning Signals.

Rather than taking a blaming perspective, or one that would deny the difficulty that business actors face to combine their economic incentives with their values for precautionary actions, we review and analyze relevant interdisciplinary literature and prominent case studies – in particular those documented in Late Lessons from Early Warnings (EEA, 2001) – with the objective to better understand business decisions in the face of early warnings.

We show that economic motives are often driving non-precautionary decisions, but that they also influenced by a complex mix of epistemological, regulatory, cultural, and psychological aspects. We provide a set of lessons and reflections.

The Prince of Wales's Business & Sustainability Programme: Brussels Nov. 2011

Marc Le Menestrel — 2011-11-10T13:39:00Z

On November 10, I was invited to teach a short session on Values, Ethics and Leadership to the Prince of Wales's Business & Sustainability Programme in Brussels.

Part of the University of Cambridge Programme for Sustainability Leadership, this programme appears to me as one of the most advanced and proactive programme in Sustainability and Leadership.

In fact, given the proactive positioning of the programme, I was expecting some reluctance from participants to see their “dark side”, which I believe is a pre-condition for any intellectually honest work on ethics.

In reality, I was surprised to observe that many of the participants were ripe for self-questioning and far from being self-serving in their thinking.

I believe this reflects the quality of the three days they had attended and I am glad to have experienced this particularly high-level and enlightened audience.

It was a priviledge to meet and discuss with executives at the highest level, for instance from the oil industry in Irak or Nigeria, thus gathering precious perspectives for my udergraduate teaching of these issues (see for instance my undergraduate seminar on Shell in Nigeria).

Even in a short session, it was possible to share concrete and effective ways to better think, act and communicate about ethical leadership.

In particular, I expressed the idea that a credible communication about sustainability requires to identify and share, in the appropriate manner, the extent to which we are not sustainable.

Ethics is one of the most difficult and fascinating dimension of business today, in particular because it links the very inner part in each of us with the destinity of our species. In this assignment, I felt how much walking this path requires us to be centred.

Business and Biodiversity: the Next Sustainability Challenge

Marc Le Menestrel — 2011-08-05T16:13:29Z

As an aftermath of my growing interest for Biodiversity issues (See our initiative with Julian Rode Biodiversity and Ethical Business), I was proposed to lead the academic organization of the 26th Alumni Sustainability Roundtable at Insead. We have prepared an interactive process to draw from the expertise of a series of prestigious speakers.

Below is the abstract of the rountable, to know more, acces the INSEAD website of the roundtable

Business and Biodiversity: the Next Sustainability Challenge

23 September 2011

INSEAD, Fontainebleau Campus, France

There is a growing concern in business about biodiversity loss and change and about the risks and opportunities biodiversity entails for the bottom line. This roundtable will present and discuss the implications of biodiversity issues for the business world. In an interactive and participative process, participants will discover how biodiversity affects business through impacts and dependencies on natural resources. The purpose is also to identify critical trade-offs for society and business, and discover new ways of being smart in front of systemic interdependences. Improving our capacity to be part of the solution to one of the most comprehensive challenges the human species is facing is at the core of this debate.

A Journey Through the Forest

Marc Le Menestrel — 2011-07-19T12:27:38Z

In these last years, I have been dreaming of accompanying executives in Nature, to share my teaching in this only place where I truly feel at home. I could see the day where I could teach from my true self, as much as a rock-climber or an academic.

Thanks to the vision of Jens Meyer at CEDEP and of his client, this became reality in June 2011 with a 2-day program in the Fontainebleau forest, followed by a 1/2-day debriefing to facilitate integration and re-entry.

I may have spent in this place most of my week-end before 20, discovering this magical forest in the typical tribal way of my rock-climbing friends and with unbounded passion. This journey was like coming home: a deep feeling of belonging.

Here is how the program was presented to a set of 40 Human Resources participants of a large multinational:

The purpose is to prepare you to guide the leaders of your company in their own journey. We will take the time for you to go deep in who you are and who you want to become: we want your own journey to become the primary source of your excellence towards others'.

We will dream, reflect, share ideas and visions to be ourselves, for us and for others: to work better together.

Day 1: Anchoring in the past, dreaming the future: being with integrity.

Day 2: Giving to others, protecting ourselves and trusting the unknown: becoming together.

½ Day 3: Integration towards my role as HR leader

Experiences in nature combined with cutting edge leadership development approaches and discussion are an effective way to help us realize how much we are part of nature. We also experience that our own accomplishment depends on looking after each other and the environment. Our nature can be a surprising and distinctive teacher…

Download the flyer (pdf) for more information.

Nuclear Governance: Choices and Non‐Choices

Marc Le Menestrel — 2011-07-13T12:37:38Z

THIS EVENT IS POSTPONED TO MAY 2012

The International A. Sakharov Environmental University (Minsk, Belarus), the Central European University (Budapest, Hungary) and the Vrije Universiteit Amsterdam (The Netherlands), in cooperation with the European Commission Tempus project “Environmental Governance for Environmental Curricula” and the OSI ReSET project “Governance of Global Environmental Change” announce an Autumn School, a Conference Panel and a Workshop on issues of nuclear energy in society.

The central theme of the three-part event is nuclear choices and non-choices. It will constitute a unique opportunity to explore the fundamental choices of nuclear energy governance at the scientific, political, economic, social and personal levels.

The event will commemorate the 25th anniversary of the Chernobyl disaster, and allow a joint reflection on the Chernobyl and Fukushima accidents. It will amongst other explore the differences and similarities in information and communication flows and in crisis management in nuclear accidents in such distinctively different societies as the USSR of the 1980's and nowadays Japan. On this basis, a reflection will be jointly developed on risks and
options for the future governance of nuclear energy and of its legacy.
Two key purposes of the three‐part event are to create a discussion space and to provide a quality research training taking a governance perspective on nuclear issues, i.e. to discuss the actors and networks involved in the issue, their interactions, their rationalities and their stakes. The discussion topics will include but will not be limited to: communication, ethics,
economics, politics of the nuclear energy sector, as well as essential technological aspects.

Another objective is to offer participants a hands‐on experience of constructing and participating in a policy/stakeholder discussion. The event also aims to contribute to the ongoing discussion about constructing the first nuclear power plant in Belarus.

Read the desciption document to learn more about this workshop.