We have heard over and over the term accountability, and that we need to hold those accountable. What does that mean? Webster’s thesaurus defines accountable as follows: “being the one who must meet an obligation or suffer the consequences for failing to do so, “the owner was held accountable for his dog’s biting of the child.” http://www.merriam-webster.com/thesaurus/accountable . Simply, one must suffer the consequences of one’s decisions and actions. Willful negligence is an action that has been used to buffer legislators and executives for decades. Where is the AIG executive team and why are they not falling under a class action lawsuit along with the board of directors who allowed the behavior? Sarbanes Oxley was a first step to try and bring any form of responsibility to corporate America. However, since the congress has never experienced fiscal or personal responsibility, they really didn’t understand how to write the legislation necessary.
In general, there is a lack of specifics throughout corporate America as well as in our government. Being accountable is not just getting all of the negative things thrown at you either. Sometimes you are not the guy for the job, and that should not be held against you. Being accountable also means taking responsibility for stepping aside when someone or something more adapted to the environment is presented. The hard part, for those who are accountable, is we often get our lives and identity imbedded into whatever we are responsible for or accountable to. Let’s be specific. For accountability to be usefully we must be able to specifically answer the “w” questions:
· Who is accountable?
· What are they accountable for? Specifically.
· When are they accountable for the actions and decisions?
· How long are they accountable for those actions and decisions?
· Where can we address problems and to whom?
· Why is it this person and not someone else?
Accountability is an individual thing, and if a group is going to be responsible, then every member of the group must be held accountable for the actions of all of its members. That is why Arthur Andersen is no longer in business. A 100 year-old company was dissolved within 30 days based on the actions of a few members. Accountability is a lonely and scary place. It means that we are judged by the content of our character and actions, not by the color of our skin, eyes or any other arbitrary criteria. This means living with the consequences of actions and decisions without a safety net. This is why leaders are those who will take on the hard jobs, make the tough decisions tempered with the understanding that part of the learning process is to make mistakes. As a culture we have problems with this attitude and the Japanese are really tough with it, just ask those samurai who failed in their assignments. There should be balance. People will make mistakes. They must in order to learn. Part of that learning process is to experience the consequences of your actions. The pain involved is a teacher. That being said, the fact that someone made a mistake should not be held against them, what should be recognized is if they learned and what they did learn from those actions.
Now what does this to do with the state we are in now? We should not be bailing out the banks. There is no company too large that we cannot survive its demise. As a company goes under, much like Bears Stern investments, there are those who will procure pieces of the company and let those that should be dissolved dissolve. This will engender the class action lawsuits and the rest to aid in the dissolution. The things that would help legislatively would be to strip some of the protection from the board and CEO’s from shareholders. Shareholders must also feel the pain of losing their investments and not forcing board changes. As a group, we have been negligent in exercising our rights to change the board of directors. I know that the Yahoo board is probably not happy at turning Microsoft down during the last round. Unless they can completely change direction, the company that truly created portals and web capabilities will be a thing of the past. If we can live without Yahoo, we can live without AIG, or Citigroup. Those people who were employed by those companies are now free to explore alternative opportunities. They may start their own companies that fill the need and void left by the large company’s demise, and become rich in the process. If we cannot change and adapt we will die and the next culture will take over.
The government bureaucracy has demonstrated consistent mediocrity in decision making. The disasters of the Katrina rescue and the subsequent rebuilding fund management. How were the billions of dollars spent? For an interesting exercise, try and find out how much was actually donated, spent and used for hurricane Katrina recovery. Then try and find out how much Homeland Security spends. We have taxation without representation and that should be a concern for everyone. The same goes for CEOs. How to you tie compensation to performance? How do you establish compensation that is fair and based upon achievable goals? How do we, as shareholders, hold the board accountable? These groups are so large and hidden behind rules, infrastructure and legislation that it is impossible to hold individuals accountable.
For instance, how does an organization hold people accountable when things breakdown? Why in 1909 during the earthquake in San Francisco did individuals get into cars and have soup kitchens and take in strangers to help while we had National Guard units turning those trying to walk out of New Orleans back into the flooded city? Why do we not ask the relevant questions of a mayor who shut down bus service the day before the hurricane hit, and the governor who turned down repeated proposals from the Army corps of engineers to fix the levy system due to lack of federal funding? With billions in federal aid, why are the levies still not fixed? Who is accountable? The answer is no one. We, as a people, generously gave but did not use our heads to ensure that the money was spent well.
Accountability and responsibility are the cornerstones of any functioning society. Oppressors and tyrants manipulate the press and people by focusing and refocusing people’s attention on grand issues that can never be addressed as they are too broad and no one can be held to task for fixing or addressing the problem. If you do not think this happens here in America, look at any news broadcast and ask yourself, who could realistically be responsible and accountable for the topic at hand? The bailout is a prime example. How much “pork” is built in? Who is going to be responsible for reporting on the billions? Will we care six months from now, when it is no longer in the news, or will it simply disappear into the nebulous rhetoric that is spewed by the left and right of the podium? Accountability takes thought, careful and judicious application tempered with understanding and the courage to actually stand-up and be accountable.
