Have company directors finally woken up to the long term reputational damage that male leaders are causing organisations when they behave like entitled, sex-focused, arseholes (predators?), towards their female subordinates?
The damage to the reputation and career of male arseholes of this type has been, to date, negligible (exhibit A: Donald Trump).
As Crikey, this week, notes:
“As recent cases in Australia have shown, it’s rare for workplace sexual harassers to face serious consequences. They might have to sell a boat to pay off a settlement or forgo part of their bonus, but soon they’re right back on track.
Meanwhile, the victim’s career takes a nosedive. And so does her health.
Research has shown that the blood pressure of people who reported workplace sexual harassment was so high they were at risk of suffering stroke, aneurysms, kidney disease and heart attacks. They’re also nearly three times more likely to take their own life.”
Company boards, inevitably either all-male or male-dominated, have been complicit in the lack of public transparency and accountability as to the behaviour of these arseholes.
Has the massive fallout suffered by both Uber and The Weinstein Company, as a result of the behaviour brought to light in 2017 of their respective founders, Travis Kalanick and Harvey Weinstein been the start of something more pervasive than a social media hashtag?
As a white man who has suffered no harassment or discrimination in his life, I am cautious to assert that a tipping point has been reached; however it appears that inappropriate sexual behaviour in the workplace is finally being seen as a wider organisational culture issue not merely as an inconvenience to be dealt with by company boards on a case-by-case basis.
Last month in the United States, McDonald’s issued a law suit against former CEO, Steve Easterbrook, for allegedly lying over the extent to which he had relationships with McDonald’s employees. McDonald’s and Easterbrook parted company late last year after Easterbrook was found to have sexted a subordinate.
The McDonald’s board asserts that Easterbook would have been fired, and therefore not entitled to most of the $40 million worth of entitlements paid to him, had Easterbrook told the truth to McDonald’s investigators about the number, and extent, of the sexual relationships he had with McDonald’s employees.
Specifically, “recently identified evidence shows that Easterbrook had physical sexual relationships with three McDonald’s employees in the year before his termination; that he approved an extraordinary stock grant, worth hundreds of thousands of dollars, for one of those employees in the midst of their sexual relationship; and that he was knowingly untruthful with McDonald’s investigators in 2019.”
In April, two McDonald’s store employees in the US filed a USD 500 million class action lawsuit accusing the company of creating an environment of rampant sexual harassment. This was not the first such suit to be filed against McDonald’s.
In Australia, the board of AMP, already damaged after many of its unethical and illegal practises were uncovered by the recent banking royal commission, found itself minus a Chairman and board member after the backlash against the board’s June appointment of Boe Pahari to the role of AMP Capital CEO.
The AMP board found itself on the wrong side of shareholder anger when it was revealed that Pahari had been promoted despite the AMP board being in full possession of a 2017 independent review of a sexual harassment complaint made against Pahari. Pahari was penalised $500,000 from his then-due 2017 bonus but no further action was taken and the report was not released, even to Julia Szlakowski, the former employee and complainant.
Ms Szlakowski’s allegations include that Pahari discussed his “limp dick” when she refused to buy clothes with his credit card, called another employee a “fag”, pressured her to extend a UK trip and keep it secret from the company and spent company money on unnecessary international travel.
The AMP board faced further evidence of a toxic senior culture when, less than three weeks before the Pahari demotion another group executive, AMP Australia CEO, Alex Wade, departed the company in unexplained circumstances. Later it was revealed that Mr Wade had sent explicit photos to a female colleague.
The AMP Chairman David Murray’s resignation was greeted with a resounding cheer from the Australasian Centre for Corporate Responsibility’s chair Brynn O’Brien.
“It’s abundantly clear that Murray and those who share his views have no place as directors, much less chairs, of any listed companies. His views on risk and governance frameworks are stuck in the 80s and do not meet shareholder expectations of modern boards,” O’Brien said, calling Murray a climate sceptic.
“When he was appointed as chairman of AMP in 2019, investors should have asked ‘if Murray doesn’t accept the science of climate change, what or who else does he not believe?’ As it turns out, Murray doesn’t believe women.”
Two weeks’ ago insurer QBE announced the departure of CEO, Pat Regan after a complaint from a female employee led the board to conclude he had breached the insurer’s code of conduct and his position was no longer tenable. Specifics as to Regan’s conduct were not made public although a law firm’s report to the board deemed the incident ‘inappropriate’ rather than one of sexual harassment.
Three months ago former High Court judge, Dyson Heydon, faced a string of allegations, covering a period both during and after his tenure in one of the most powerful positions in Australia’s legal system, of behaviour towards women that included inappropriate comments, leering, unwanted physical contact and sexual assault.
In a 2019 SHRM study the cost of a toxic organisational culture was estimated, in a recent five year period, to have cost the US economy $223 billion, just in staff turnover costs.
Last month the World Economic Forum, in conjunction with global consulting firm Willis Towers Watson, released a white paper that, as the title suggests, Human Capital As An Asset: An Accounting Framework to reset the Value of Talent in the New World of Work, sets out a more sustainable way for an organisation to consider its existence.
The first two, of seven guiding principles that the WEC paper outlines as a way to shift the way human capital is valued:
From: Profit (for a narrow group of stakeholders)
To: Purpose (shared value between the workforce and a broad group of stakeholders)
From: Corporate policy (Complying with code of conduct in the workplace)
To: Social responsibility (living corporate values in the community)
As is often the case, our industry is leading in the new world of work, especially as it relates to the treatment of women.
For many years V. John Plummer, led the way for the Australian business community in providing a safe and empowering company culture in which women could flourish.
Mr Plummer was one of the key people in the establishment of a united representative association for the recruitment industry.
The Recruitment and Consulting Services Association (RCSA) is the current incarnation of that original association.
Just last month the fully revised RCSA Code of Professional Conduct came into effect.
Part B (Operational Integrity) point 10, Social Sustainability, states
a) RCSA Members:
i) conduct business in a way that avoids causing or contributing to exploitation through their activities;
ii) seek to prevent or mitigate risks of exploitation that are linked to their operations or services by their business relationships, even if they have not contributed to those risks.
We now have the obligation to fulfil our duty as professional recruiters to, as far as possible, mitigate the likelihood of sexually-oriented behaviour by arseholes in the workplace.
And, if this behaviour occurs, to be responsible for taking the appropriate action, regardless of what we may think it might cost us, financially, in the short term.
Men who sexually harass women are arseholes; arseholes that are not welcome in today’s workplace.
In memory of Mr Plummer’s exemplary conduct and standards, let’s lead the way in moving from profit to purpose and from corporate policy to social responsibility.
Note: I am co-hosting a free 45 minute webinar for RCSA members; Case Studies of the RCSA Code in Practice, on Wednesday 30 September. Details here