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Samhoud

maart 27, 2024

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Organisational Integrity: Preventing Issues by Behaviour Analysis

 

How do you explain integrity issues or misconduct within organisations? And, more importantly, how do you prevent it? These questions were at the forefront during the second part of our virtual training week. Under the guidance of colleague Dr. Wieke Scholten, we delved into a case involving an international bank. &samhoud investigated the undesirable behaviour patterns within a department that could lead to potential future issues. We take you through the three key lessons from this session.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Misconduct is almost never the result of an individual rotten apple but has various root causes within the organisation’s system.

 

When an integrity issue or unethical behaviour occurs in an organisation, it is often attributed to one individual: the rotten apple in a shiny and polished fruit basket. However, this behaviour is often caused by various underlying factors, as we learn from Scholten. Imagine being a trader making millions by taking excessively high risks. You conceal this by booking fictitious hedging transactions. It earns you towering bonuses and attractive promotions. Unethical? Certainly. But look at what happens in the context. Your team members come to you when they need help. Your manager praises your successes and raises your targets to encourage this behaviour. And no one ever asks a single question about how you pull it off. “We didn’t know how he did it, but we didn’t want to know,” say your team members afterward. This is a literal example of Kweku Adoboli, a British trader who spent four years in prison. Unfortunately, this example is emblematic of how things often play out in practice.

 

Attributing misconduct to one individual is dangerous, according to Scholten. On the one hand, it prevents the organisation from learning from its mistakes and from adjusting the right levers to prevent future issues. In the assessment conducted by &samhoud in organisations, we therefore examine the driving forces behind behaviour at various levels. We explore how the context, the organisation itself, and social norms lead to certain behaviour. This includes laws and regulations, governance and reward policies, the influence of leadership, group dynamics, and the moral climate. We combine the analysis of root causes with our knowledge and experience of behaviour and organisational change. This not only helps our clients analyse but also prevents unwanted behaviour.

 

True insight into behaviour through quantitative data and operational reality.

 

We delved into a case involving an international bank. In no time, we absorbed a large amount of data to uncover risky behavioural patterns and underlying causes. When we examined the Key Performance Indicators (KPIs), everything seemed fine. However, by digging into interview reports with employees, shocking results emerged. This is often the case, Scholten tells us. Surveys and reports often only capture a limited part of reality. On the one hand, surveys are often filled out in a socially desirable manner, and on the other hand, they do not provide insight into the root causes behind the figures. To truly understand what is going on, you need to know how things operate on the ground: the operational reality. That’s why, in our assessments, we always opt for a combination of research methods: desk research, interviews, and observations, for example, during team meetings. Combining all this input leads to a much more realistic picture of reality.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


“Combine the perspectives of different team members and encourage dissent to arrive at well-founded and balanced conclusions.”

 

 

 

 

 

 

 

After conducting the case investigation ourselves, Scholten provided insights into how this typically unfolds in a normal process. Following an extensive data collection process, a team of multiple advisors dedicates two days to a collaborative analysis of risky behavioral patterns and underlying root causes. Everyone has a voice, explains Scholten. This prevents psychological biases within our own team. One of the risks in such exploratory research, for example, is a ‘confirmation bias’: individuals may quickly seek data that confirms their existing beliefs. By building conclusions with different team members and challenging each other’s assumptions, we arrive at well-founded behavioral patterns and the causes behind them. If you want to learn more about our analyses and interventions on risky behavior within organisations, please contact Wieke Scholten. Wieke Scholten holds a PhD in the impact of social norms and team climate on unethical behavior. She played a key role in the behavior and culture supervision at DNB, served as the Head of Behavioral Risk at RBS London, and now applies her knowledge and experience at &samhoud across various financial institutions.

 

As a leader, you have to realise how scary you can be and therefore you need to strengthen your listening skills. The moment you are in a leadership position it becomes essential to listen to what’s not being said. Actively invite people to share their ideas, embrace vulnerability and accept that it’s okay not to have all the answers. This allows for a more authentic connection with your team.

Leaders often forget that people act differently to people higher in the hierarchy. As a leader you might think that you are approachable and that you have open relationships with your employees, but the fact is that people perceive you different.

 

The moment you become the business man or woman of the year: be aware of your own narcistic tendencies and realise that your life might turn into an echo chamber where everybody tries to please you.

For leaders it is essential to question your list of trusted advisors and connect with the less obvious people around you. Surround yourself with a diverse group of people, including both older and younger individuals, to keep your mind fresh and open to new ideas.

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