16 May Three Lessons We Can Learn from AMP’s Royal Stuff Ups
In the words of Chris Isaac, AMP “did a bad, bad thing”. They were not alone.
According to recent ABC reports, Australia’s banks have been plagued with one scandal after another over the past decade. At the heart of it is the “banking industry’s promotion of an aggressive, sales-driven culture, which emphasises profit at all costs”. Add to this a flawed compliance structure, and the refusal of banks to hold anyone in a senior position accountable, and things get pretty bad, pretty quickly.
Rather than joining the pitch-fork march, we see constructive lessons in this scandal that are relevant to every business leader and owner, and we’ll start with a controversial statement: “It could happen to you”.
Every business has a shadow
“Amicus certus in re incerta”; ‘A true friend in uncertain times’. When the Australian Mutual Provident Society, AMP, was founded in 1849, this Latin phrase was its mission statement. Their employee code of conduct stipulates a “culture of help… professionalism, honesty and integrity”. Like many organisations, AMP took time to define their values internally, based on the way they wanted to be perceived externally. When customers were charged fees for services that were never delivered, many were left wondering whether AMP was indeed the kind of “true friend” they wanted around.
Organisations are consistently dealing with behaviours that are misaligned with their values. The natural reaction of most leaders is to observe that values were not defined clearly enough, or not enforced forcefully enough. There is a third, critical aspect, often ignored by leaders, and that is the “shadow”.
In Jungian psychology, the shadow refers to the unconscious aspect of our personality which we do not readily identify in ourselves. Karl Jung, founder of Jungian psychology, worked extensively to better understand personality, in all its lightness and darkness. “Everyone carries a shadow” he wrote, “and the less it is embodied in the individual’s conscious life, the blacker and denser it is”. In simple terms, the shadow is the “dark side”.
We tend to reject the least desirable aspects of our personality in order to protect our ego. As a result, the shadow remains a largely negative space that can rear its head unexpectedly. Organisations, like humans, have personalities in the form of cultures. Like our personalities, cultures too have a “shadow”; the least desirable aspects of a culture, which we do not readily identify with.
How is this relevant to a Royal Commission into banking? Because every organisation has a shadow, and the shadow of many financial institutions is now under investigation.
How well do you know your shadow?
There is an old Cherokee Indian tale known as the Two Wolves. An Indian chief tells his grandson of a fight between two wolves. One wolf is darkness and despair, the other is light and hope. The child asks “Which wolf wins?”, to which the grandfather responds, “Whichever one you feed”.
We see the two wolves fighting within us, and within most organisations. No matter how much we want ‘professionalism, honesty and integrity’ to win, we may unconsciously be feeding its opponent, in this case the toxic culture focussed on “profit at all costs”.
A financial advisor at AMP on their way to a performance review, may walk past three posters in the corridor that speak to the values of “professionalism, honesty and integrity”. Their manager commends their positive impact on the team, but stresses the importance of financial outcomes again, and again. They leave the meeting to find that their peers have been promoted on the basis of their financial returns, notwithstanding their selfish behaviour and lack of concern for customers. Implicit in this tug of war, is a demand of the employee to make a decision between the stipulated values of the company and the outcomes expected of them. The shadow is not directly discussed because that would conflict with the organisation’s espoused values and image, however it lies beneath the surface and is as powerful as ever.
The question that follows is: What are the two wolves in your organisation, and how do you recognise them openly before the shadow takes on a life of its own?
All teams, no matter how good, are capable of doing bad things.
If your natural inclination is to think “that would never happen in our business…”, know that this is precisely the language and conviction of the “shadow”; it wants you to think that. The shadow, after all, is made up of the things we don’t see ourselves as capable of doing.
Let’s be a ‘good friend in an uncertain time’ and assume that AMP’s employees are not bad people. What then allowed them to do bad things? Somebody within a team within AMP knew this was happening, and probably wanted to say something. But they either didn’t or did and weren’t listened to.
So how can you shine light on your organisation’s shadow?
1) Assume your organisation is capable of bad things:
Don’t look disapprovingly from afar at the fall of another organisation without asking “what can I learn?”.
2) Celebrate the challengers – they may just be the only ones to have touched your shadow:
When you are confronted with ‘nay-sayers’, ‘whistle-blowers’ or ‘challengers’, examine the truth in their words and challenge yourself not to isolate them, but promote their contribution.
3) Normalise conflict – that’s how the good wolf wins:
Allow conflict to play out and conversations to unravel. It is often not easy or natural for those who need to speak up to do so. Create space for those conversations and nurture them so people know they are safe.
4) Foster diversity in your business:
Diversity of opinion brings elements of the shadow into the light of day. If you are surrounded by ‘yes people’, ‘loyal friends’ and ‘predictable lieutenants’ your shadow is likely to remain hidden.
Alon Cassuto, Senior Consultant
Tom Canny, Consultant