Eighteen months ago we hosted an event at Baker & McKenzie in London on "Trust Matters". The theme resonated very strongly with our clients and our people.
The importance of cultivating trust by way of greater transparency, accountability and integrity in a period of exceptional economic, political and cultural change has become even more accentuated following the event.
As the CEO of a law firm whose work is based on advising global companies to comply with the law, particularly across borders, I firmly believe that building trust goes far beyond just a legal requirement. That is true for all organizations and more so for professional services firms, the essence of which is people.
As I said at that event in London, in business, trust is the glue that binds employees to employers, customers to companies – and companies to their suppliers, regulators, government and partners. Yet several years on from the global financial crisis, trust levels remain low and greater efforts to rebuild trust are in order.
Most companies appreciate that high trust levels lead to a stronger reputation, sustainable revenues, greater customer advocacy and increased employee retention. It is also likely that companies with higher levels of trust will bounce back from future crises far quicker than others.
Trust is an asset that companies need to understand, but also manage and nurture in order to succeed, particularly in this highly interconnected and global world where news – especially bad news – travels fast. So how do we go about doing this?
Organizations must do more than just comply with rules and regulations. They must also be seen to be doing the right thing and must have good corporate governance practices in place. Second, we must focus on building trust in the rule of law. Both businesses and economies can only thrive if there are clear rules, consistent enforcement of such rules, high level of certainty about the parameters of decision-making and clear consequences for unlawful behavior.
This certainty is especially needed when entering a new market or in other unfamiliar situations, such as when dealing with new business models or using new technologies such as 3D printing or driverless cars, to take two examples.
All these developments will need new laws, new ways of ensuring all parties can look each other in the eye and know they will get a fair reward for a fair transaction. In short, that they can trust each other.
Most importantly, to really win back trust, organizations must show their dedication to a broader purpose. They need to prove they are not just driven by quick profits, but also by values.
The tone for building trust has to come from the top in any organization. Without that commitment and leadership, a culture of integrity, of both seeing to be and actually doing the right thing, falls away.
In my own firm I would point to three concrete examples in the last year where I believe we have made a real difference in creating that greater transparency and integrity, which is so important to building that trust.
We have recently revised our code of conduct which is applicable to all 13,000 of our lawyers and business staff. The code not only sets out clearly our cultural and behavioural expectations from all our people but also has a clear set of training requirements to reinforce those expectations. The guiding principles by which we operate are just as important, if not more so, than any formal rules.
Second, we introduced a new whistle blower policy so that it is safe for people to speak up as a cultural enabler. We want all of our people to be accountable to and for one another, to make the right choices and do the right things, and to report concerns up the chain for appropriate investigation.
In June last year, I was delighted to sign on behalf of Baker & McKenzie the UN Global Compact which pledges to support and promote ten universally accepted principles in the areas of human rights, labor, the environment and anti-corruption. Its principles align with our firm’s values and are reflected in our strategy, culture and day to day operations. We take great pride in being a good corporate citizen and signing the Compact is an expression of this commitment.
I see a lot of connections between what we are doing as a firm with the great work the World Economic Forum is doing through the Partnering Against Corruption Initiative (PACI), including the importance of setting the tone at the top. The legal sector, which is often accused of being opaque, old fashioned and out of touch with reality, is going through significant changes at the moment. I believe membership of an organization like PACI is an important signal of a promise to all our internal and external stakeholders of the importance we place as a firm on the value of transparency and integrity and I welcome PACI's continued efforts to promote dialogue in this important area.
The report, Partnering Against Corruption Initiative - Infrastructure & Urban Development, is available here.