Monday, 14 March 2011

Obama, Crowley, Manning and Corporate Governance

What do the conditions of incarceration of Private Bradley Manning have to do with corporate governance?

Manning is accused of being the source of material published by Wikileaks that may have compromised US security and has probably cost lives amongst informants whose identities have been compromised. On the one hand the allegations against him are serious whilst on the other hand he is being held in conditions that amount to torture. He has been held for nine months under conditions that include "nudity, prolonged isolation, harrassment and sleep deprivation." Prison psychiatrists have denounced the justification put forward for such conditions.

Challenged about this unconstitutional abuse of a remand prisoner, State Deparytment spokesman P J Crowley dubbed it “ridiculous and counterproductive and stupid.” and, as a result, was rapidly forced to resign.

So the link to governance is that we have improper behaviour by subordinates, associated with steps to cover it up and then a classic whistleblower who is promptly victimised. So the issue goes to the very top, to president Obama...

Obama: "With respect to Private Manning, I have actually asked the Pentagon whether or not the procedures that have been taken in terms of his confinement are appropriate and are meeting our basic standards. They assure me that they are. I can’t go into details about some of their concerns, but some of this has to do with Private Manning’s safety as well."

At the top you need ethical responsibility. Instead Obama asks the perpetrators of the questionable behaviour to self-certify that they are behaving properly. He also seeks to cut off debate by saying that there are things that cannot be discussed. All this is played out in the public realm where the checks and balances of governance ought to hold his government to account. Unfortunately the American body politic tends to be quite casual about morality in regard to their enemies; vide Guantanamo, water boarding, prisoners in general and now Manning in particular.

As with most corporate governance issues there are consequences to this behaviour. The moral standing of the US is further eroded and now both Republican and Democratic administrations are tainted as hypocrites. This will undoubtedly affect US interests when it seeks to speak for the 'free world'. The power of a nation lies in more than its military and financial power but also in its influence and moral standing. The parallel with corporations is that they too suffer real damage when their reputation is damaged through poor governance.

This is not meant to be a political post nor even about human rights: it is about the checks and balances in a system that prevent wrongdoing, abuse of power and behaviour that will damage the long term interests of a corporation. The example, from the world of government, illustrates the need for ethical standards and moral courage at the top and for stakeholders (in this case citizens and voters) to stand up and be counted when their servants go wrong. These behavioural issues are as vital to good governance as good systems and procedures.

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