I was invited to deliver the keynote lecture at the St Kitts-Nevis-Anguilla National Bank Compliance Conference earlier this month (July 2011) and had the honour to meet the bank's CEO, Sir Edmund Lawrence. I also met several members of his management team, including Donald Thompson, his very able Senior Assistant Managing Director, and Stephen Hector, my fellow alumnus of the University of the West Indies Faculty of Law, and the director that is responsible for the bank's legal affairs. During my visit I was very ably assisted by the Executive Manager of the bank's Compliance department, Mrs Pamela Pogson. This bank is highly regarded in the OECS and having met the executive management team, I can see why. Sir Edmund has brought together an excellent cadre of executive management. The rest of the Caribbean has a lot to learn from this banking group of companies.
On receiving the invitation I had suggested, and I thought it was agreed, that I would say some something on the “responsibility” of the directors and executives. In other words, I assumed that I would be expected to lecture on corporate governance. Corporate governance is an area I am very interested in. It is also a field of study that we do not have good handle on. I was so focused on my original supposition that it never occurred to me that was not what the organizers had intended. It was only later that it became clear that organizers might have instead intended to invite a discussion on “corporate social responsibility.” There is a fundamental distinction between these two areas. The first is concerned with how directors and executives function within the corporation. The second is concerned with how the corporation functions within the society. When I realized that I would have to give two lectures (the keynote address and a later public lecture), I decided to focus the later lecture on the corporation in the broader society and confine the earlier one to issues arising from the internal responsibilities of the directors and executives.
It occurred to me the other day how irresponsible managers usually are. By that I mean to say that managers do not usually hold themselves responsible for the adverse consequence that follow from their bad decisions. Part of the problem stems, in part, because we have not developed, and certainly we do not enforce, effective indices to measure management's successes and failures. It is true, perhaps, that the most effective index of an organization’s success is the increase in its value to its shareholders; but how much of that increase in any case is genuinely attributed to any particular manager? And how can we find out? We have already seen the tendency of the members of modern management to walk away from failure on the basis that we can rarely attribute failure to one person. On the other hand, they all jump on the bandwagon to claim a share of the success. This is certainly not true for any other trade or profession. There are measures of success and failure for every other occupation, whether it is the gardener or the specialist surgeon. Managers and administrators alone are exempt from any assessment.
