As we see another element of the financial services industry failing judicial scrutiny, we hear the approaching footsteps of the regulators with more force.
By their very nature regulators seek more regulation. It increases their authority, gives them greater power, and broadens their mandate.
Already excessively anxious to take their place as our corporate police force, regulators find their own ambition validated by the spray of technical solutions demanded by our political representatives.
As those in organisations already know, technical solutions are ineffective when dealing with complex problems.
Broad and insistent regulation causes deep insult and damage to the culture in organisations and to the people within them.
The errors we have seen paraded at the Commission are the errors of human beings. Errors, generated from a complex adaptive system that humans and their communities form.
Yet Integrity, the silent protagonist, stands watching the debate, waiting for a voice. Integrity, the simple and ancient truth that we all – each one of us – know what is right. We can always find within us the right thing to do.
We must simply remember the right questions to ask ourselves. We know the answers. Intuitively we know how to deal with the complexity because we are that complexity, and our business and political leaders must deal with this complexity without resorting to ineffective knee-jerk reactions and impulsive regulation.
True for some, the golden purpose of doing the right thing has been covered and entangled by the short term-ism of financial reward and job security in an insecure work function. Or some people wilfully do the wrong thing.
But to suggest that we – the vast majority – are incapable of reflection, decision, realignment and living according to the right thing is plainly insulting. And the unintended consequences of regulation can easily outweigh the ultimate benefits.
It is disappointing that our political representatives elected as our representatives, rush to political expediency, and brand us, their constituents, as fundamentally unable to behave properly. It is an apathetic and inelegant solution.
As they proffer regulation with the shaking hands of political self-interest, they insult us.
It is not hard to access our values and our personal sense of community in order for each of us to come to work and consistently do the right thing. Our leaders need to engage us, at a political level, at a corporate level, and at a community level. They should implore us with their words and their actions, to do the right thing.
The culture that this leadership would generate and nurture would drive away errant inconsistent DNA that oppose our core values. Our true DNA – our purpose – would deepen and strengthen. Poor behaviour would be rejected by the community.
When talking about the people in his organisation Warren Buffet said: “In looking for people to hire, you look for three qualities: integrity, intelligence, and energy.”
Overregulation saps and diminishes all of these qualities.
We train our business leaders to empower their people. We teach them to charge their staff with responsibility, self-awareness, self-discipline, self-motivation, resilience, contextual awareness, and ownership of their decisions. The best organisations coach their teams towards these courageous principles.
Regulation robs us of our discretion and volition. It limits our purpose and our natural need for community. It inhibits our future leaders. We are at risk of withdrawal into regimented reaction.
We do that when we are insulted and diminished.
Regulation will do that to us.