Pressures That Lead Good People to Make Bad Decisions with Richard Bistrong

Mike: [00:00:00] 

Our guest today is Richard Bistrong, a formal international sales executive who spent over a decade closing deals in some of the world’s most challenging markets. In 2007, Richard was caught up In a federal Foreign Corrupt Practices Act investigation, which led to a guilty plea, and over a year in federal prison, he turned that experience into a mission.

And today through his consultancy, Frontline Anti-Bribery, LLC, he works with companies like Volkswagen, Airbus, and Microsoft, helping leaders and sales teams navigate real world pressures that lead good people to make bad decisions. Richard, welcome to the show.

Richard: Mike, it’s a pleasure to be here. Thank you for the invitation.

Mike: Yeah, can’t wait to hear more of that story around 2007, a little before and then after. So really want to dive in. 

But the first question I’ve gotta ask is from all of your [00:01:00] experience, what do you believe is the one most important characteristic of a great leadership team?

Richard: Well, there was an HBR article called What Sets Genius Teams Apart, and maybe we can put those in the show notes. And that grabbed my attention because it captured what I think is that characteristic is know the art of a good fight and to appreciate that not everyone has the same opinion. People come from different perspectives, but know how to have constructive friction, to know how to have constructive dialogue not with overwhelming or dominant narratives, and then go have coffee afterwards. Right. So you’re able to compartmentalize that. So I love the way she headed that, which is know the art of a good fight

Mike: Well, I need to check out [00:02:00] that article and I actually did. I’m glad I didn’t have that article yet, or I may have stolen some of those ideas, which is not good. I don’t wanna steal anybody elses ideas because,a few episodes ago, I did a whole episode on conflict as a leadership team strategy.

So I not only believe in it, I did a whole podcast episode about it. That’s great. And I would imagine, we may get back into that theme somewhere in this conversation on, making sure we’re. We’re not doing bad things by, by, by challenging each other and challenging leadership. So, so I think we’ll get back to that.

But before we do,take me back to kind of the lead up to this incident. We’ll talk about in 2007, what kind of led to it and give us a little bit of your background there.

Richard: Sure. So Mike, let, just as a precursor to that, let’s be clear. Cheating is always a choice. So we’re probably gonna wade into [00:03:00] rationalizations and temptations and justifications, but we never have to sacrifice integrity to succeed. But as you shared, part of this discussion is, you know, how can we tip people to the right side of leadership and decision making?

But essentially, Mike, I spent 10 years as an international sales vice president. In a rapidly growing defense manufacturer, our products specialized in bullet resistant vests and armored vehicles and riot control equipment. And from 1997 to 2007, I was on the road overseas about 250 days a year. And part of that I lived in the United Kingdom.

And there is a law that. Is very clear. It’s the Foreign Corrupt Practices Act that you cannot pay [00:04:00] a third party. A, you cannot pay a public official either on your own or through passing the money to someone else who then passes it to the public official to either win business or to keep business. And I signed paperwork.

That I would not engage in any form of bribery corruption before I started this International Sales Vice president role. On the other hand, we have $4 trillion of global bribery and corruption being siphoned off our global financial systems according to the World Economic Forum. So there were times, Mike, where I felt like I was in the middle of competing corporate objectives.

Does the company want me to adhere to all that anti-bribery paperwork that I signed, or do they want me to deliver sales success in some very volatile and what we might [00:05:00] consider to be high risk regions for corruption in the world? And instead of picking up the phone and asking for help and support, I thought, what does the company really want?

Compliance or sales? And instead of asking them for that help and support, a call that might’ve saved me 10 years through the US criminal justice system, I answered that question on my own. And I said, with all these great sales and accolades and being the corporate hero and the rainmaker, do they really want to know what it’s like out here?

And I decided on their behalf that they didn’t and took ethics and compliance and integrity into my own hands. Until 10 years later when the investigators in the United States and the United Kingdom caught up with me and I became the target of a criminal investigation for violating bribery laws in the US [00:06:00] and trade laws in the UK.

So why Don’t we pin it there? So this is the sort of commerce stage and the corruption stage of this career. Up until the point I got caught. So if you have any questions there, happy to talk about and talk about them, and then we could talk about what happened after.

Mike: Yeah, let’s do that. I appreciate you, you kind of pausing there ’cause there’s so many questions, including what happened next, but let’s pause there and. 

I guess the, what it makes me think about is,your leaders knowingly, or unknowingly created some pressure for you, that drove your willingness to cut corners, to do things in a way that you knew, Hey, should I be doing that?

or shouldn’t I do that? Talk a little bit a about,the behavior and not to place the blame anywhere, you know, but on you. [00:07:00] but what was it about the culture? What was it about your leadership that caused you to say, Hey, I’m not gonna ask that question. I’m just gonna get the business.

Richard: Yeah, and I think that. This is not, there are some unique parts of my story, right? Like being an FBI, you know, cooperator and informant. But there’s some parts of this story, Mike, that are not that unique. And Mike, my company was rapidly growing organically and through acquisition, they started as a $30 million company in 97, there were $3 billion in 2007.

I mean, I think that’s considered rapid growth and it was a win above all else mentality. But that’s not unusual, right? We want to grow. That’s what companies want to do. The if they’re a small company, they want to get bigger, maybe attract investment capital, maybe to go public. [00:08:00] If they’re public, they want their share price to go up.

That’s what they’re in business for. So what I heard, and again, I didn’t. Pushback on this was we want to win and there was not. Discussion of how we win is just as important as winning. And I remember, and I think this really I a telling story, there was rapid growth in the defense field for like three of those 10 years.

And because we were. Getting equipped for Iraq and Afghanistan and there were these huge one-off orders, like 50,000 armored vests for different parts of the armed forces and armored vehicles. But eventually these organizations had what they needed, [00:09:00] so we were about to fall off a cliff because those big sales weren’t gonna be there.

And I was in a management meeting and they were asking me, look Richard, you have been making up for deficits in other parts of the company. Tell us about next year. And I said, next year we’re gonna fall off a cliff because these big sales aren’t gonna be there anymore. So we need to prepare for rapid market decline.

And one of the senior leaders said, we’re a public company. We don’t fall off a cliff, and we don’t have rapid market decline. So that was a case of goals running afoul of reality. Now that’s a management responsibility. The individual responsibility would have been me saying, then you need to find someone else to do this because I don’t make the market.

But instead, I took that as a very loud signal. Do whatever you have to do to deliver [00:10:00] results. So that was the type of atmosphere that I operated under. But again, those decisions were no one’s fault but my own.

Mike: The scary thing in my mind about all of that is it’s really easy to look even at that conversation and say, did leadership do anything wrong there? Like how would that, because I see all the time, I work with leadership teams all day, every day, and part of the way we challenge each other to. Build a healthy, profitable, fulfilling, impactful business.

Not just big at all costs, but healthy and impactful. And that part of the way we do that is sometimes we don’t take no for an answer and we say, yeah, you know, this is going on in the market, but let’s figure, you know, what are we gonna do? we’ve gotta figure out a way and. even saying that after hearing your story, I’m like, well, that doesn’t sound wrong in [00:11:00] my head, but obviously it can go terribly wrong.

Richard: it can. 

And there’s an article that I co-authored in Fast Company, which I hope we could put in the show notes because we did some research on this as to why high performers are more subject to ethical risk. Because you know what, Mike? This is natural, and like you said, there’s nothing wrong with this, but we tend to give a long leash to our high performers, right?

We’re not questioning our high performers. We want our mid performers and our low performers. We’re spending time to help them accelerate in the organization, but we’re not focused so much on our high performers. And this is something I can also relate to is once you become the rainmaker. Once you become the corporate hero, you never want to lose that status, and you will take more risk to keep [00:12:00] that status than you might have taken to get it.

But I also want to call attention Mike to something that’s a little more subtle than that management meeting, and I’d like to get your take on this. I had no international sales experience when I took this role. What I had was 10 years of US sales success and experience, and when the company wanted to put together an international division to go after some of these emerging and lucrative markets, I put myself first in line.

I had the US sales success. I have a foreign policy degree. I love to travel. I wanted that role and I got that role and I was successful. Right off the start, and I wasn’t calling the home office to say you know, Houston , we, there’s a problem out here. [00:13:00] Like I am struggling with how I’m supposed to make these numbers with integrity.

So I wasn’t making that call. But Mike, do you think that someone from leadership. Should have taken the responsibility to say, you know what, Richard’s really, he, I don’t want to use so many metaphors here, but he’s knocking it out of the ballpark and we’re not hearing from him for help, and we should be hearing from him.

Maybe we need to check in with him and to see how things are going. That didn’t happen. And Amy Edmondson in her book, the Fearless Organization calls that dangerous silence when the people who should be calling for help. Aren’t calling for help and the people that should be calling them to say, how are you doing?

How can we help you? aren’t making that call either, and that’s what the relationship was. Dangerous silence.

Mike: It’s. It’s almost as if the leadership is [00:14:00] kind of willingly ignorant. he’s bringing in the numbers. You know what we don’t wanna know as long as he is bringing in the numbers.

Richard: and that as far. Advanced as we might be in thinking about anti-corruption and bribery. Mike, what you just described, even when we see cases today, that mentality still drives a lot of people and a lot of leaders is what I don’t know, won’t hurt me.

Mike: and I think what it leads us to is this idea, well, you know, if. If we believe it, it’s more than okay. Sometimes it’s critical to challenge ourselves and challenge our teams and say, yeah, I know the market is tough, but we’ve gotta figure out a way. and if we’re not careful, it could lead to this.

What it leads [00:15:00] logically to is what can we do? Proactively, in addition to making that phone call, your leaders never made. But what could we do proactively to, you know, at the same time we’re saying, yeah, we’ve gotta figure out a way to win. There is, there are some rules. That we’re gonna live by in order to win.

and I wanna, I’m gonna hold us off for a second there and kinda leave the audience, leave the listener. A little suspense there. Because at this point I do wanna go back to the story. ’cause I want to get into a number of techniques and strategies and recommendations you have for how to make sure we’re not falling into this trap.

I wanna make sure that. The, you know, a lot of my listeners are mid-market leaders that may not be out there selling internationally, so I also wanna make sure we could pull it back to the world they’re living in as well. But before we do all that, and to leave folks in suspense, I do wanna go [00:16:00] back to the story.

So, so in 2007 you get in some serious trouble. What, what happened from there? How do you go from that trouble and jail time to FBI informant? I mean, this is like a really cool novel that you know, that, you know that this is an, it’s an amazing story. So tell us what was next after getting in trouble?

Richard: So I’m running in Central Park. I love to jog and I get a call from my lawyer that I am the target of a criminal investigation for violating the US anti-bribery law. And I mean full adrenaline, you know, hard to breathe. I like, I. I mean, that’s a call you just never think you’re gonna get, and I certainly didn’t take this exciting new role to end up getting targeted by the Justice Department.

That was not my intention. And once [00:17:00] my attorney calmed me down, he said, well, they’re also offering you an opportunity to come in and cooperate. And what that means there, there’s a legal term for it called a proffer. And it allows you to come in and tell the Justice Department everything. And as long as you’re telling them the truth, you’re like immunized for a day.

Like they can’t use what you tell them against you unless you don’t tell them the truth and they’re gonna use everything against you. And, and my attorney said, we need to seriously discuss whether or not you’re gonna come in. I go, actually, that is. we don’t, because I did it. I’m guilty. I did not intend to end up this way.

So I said, if I’m gonna change the course of my life, I need to face [00:18:00] justice and not delay it. So we’re going in, I’m gonna tell them everything. They already told my attorney about crimes that they knew about. But I had a lot more of bribery conspiracies that they didn’t know about. And I said to my attorney, your job is to get me the best deal as to what that might mean for criminal consequences.

My, my motivation, Mike, was emotional to come clean. So those sessions went well and. At that point, the Justice Department said, well, you’ve told us about a number of different things. some of these people live in the New York area where I lived at the time. maybe you can arrange to have a lunch with them.

You’re gonna wear a wire under our supervision ’cause we’d like for you to get them to corroborate what you’ve told us. That’s how it [00:19:00] started. And

Mike: and by the way, and when you heard that, I mean, it’s one thing to say, Hey, I’m gonna tell you what I know. It’s another thing to be wearing a wire and having these kinds of meetings, how, what was your first reaction? Sure. I’ll do that too. or was there a healthy dose of fear and skepticism?

Richard: Well, I’ve watched too much TV in movies probably like you have, the wire gets discovered, it falls out. You know, like it feels like a brick. I mean, everything you can imagine. You know, but I did it for three years in the United States. In the United Kingdom. So at some point it was like, that’s what I was focused on.

In my plea agreement, it says, you know, I will act in an undercover capacity at the direction of federal law enforcement. So I’m like, I thought of it as a job, right? This is what I needed to do. Then I would have to testify. [00:20:00] At a number of trials as a government cooperating witness. So it, it started off very scary, very intimidating, but I had some of the best case officers who really treated me respectfully.

I treated them respectfully and you know, they also appreciated the human element of this. And, you know, get getting the call from the Justice Department, Mike. 

Working with a team of professional prosecutors and FBI agents like that was the best thing that ever happened to me because they really allowed me to take that turn for the better and when I ultimately had to face justice, even though the government and my lawyer recommended to the judge that I get no time because I cooperated for five years, the judge said, look.

If Richard didn’t [00:21:00] cooperate and cooperate so quickly, I would be giving him between seven and 11 years today. But he did the right thing and he told the truth. He drew a line in the sand from the day he got that call, so he’s entitled to a discount, but not to going home. Yeah, that’s not how we promote criminal deterrence because people need to know people who say in the face the same challenges that he does, that no matter what they do, no matter how much they cooperate, they’re gonna face jail time.

So instead of those 7 to 11 years, I got 14 and a half months and came home in December of 2013. And the judge was absolutely right, Mike, because whatever I can say about my life, what I. What I can say, and I’m happy about this, is I got away with crime because I did it. Justice was served[00:22:00] 

Mike: And then how do you go from there to, or, let me ask, did you go right from there to, Hey, I’m gonna start my own consultancy and make sure others don’t get into this same problem? Or were there steps in between?

Richard: well. I read a book by Dory Clark, where probably. Just a few degrees of separation from her called reinventing you when I was in prison. And I’m like, maybe there’s hope here. And she really took me from despondency to hope and the whole thing was by accident, Mike. So I got home and I started to dive into the world of ethics and compliance and anti-bribery.

I’m like, wow, there’s, you’ve got law firms, you’ve got forensic firms, you’ve got advisory firms. Everyone’s there to fix your ethics, compliance, and anti-bribery problem. Problem. But no one [00:23:00] has been out there in a high risk region faced with aggressive commercial targets and who have signed off on a ton of compliance paperwork.

What’s that like? So I just started, I opened up a blog and just started writing about it and said, look, if this helps, I’m happy to do it, and if not, I’m gonna just walk away. And over time, that led for me being invited to speak at compliance conferences. Then the people in the audience were like, oh, I’d love for you to talk to our leadership team, or our commercial team, or our compliance team.

And then I got my passport back in 2017. So from the time I got caught to the time all my civil rights were restored, voting, international travel. It was a 10 year journey. And then it was, can you come to Singapore? Can you come to Shanghai? Can you come to, Dubai? Can you come to [00:24:00] Brazil? And that’s when it became a full-blown practice.

But that was never my intention. My intention when I got outta prison was to say, can this story help?

Mike: Wow. That’s all incredible. 

How, now I want to go from the story back to the nuts and bolts of, you know, what do we do about this? So, and I do want to, ’cause most of my listeners are mid-market CEOs, mid-market leaders. How does this apply? I think it’s easy for it. It’s too easy for someone to say, well, I don’t sell internationally, so this is a really interesting story, but I’m not sure this applies to me, and my sense is it absolutely does.

But help me with that a little bit. How does this apply to the mid-market leader that may not be selling internationally or maybe it doesn’t.[00:25:00] 

Richard: So let’s dig into the details of that. the, I mean, if you’re a mid-market company and you’d have no international sales at all and none of your resellers are selling internationally, then you might not have international bribery risk. Okay. But you might have other risks. You might have, you know, risk when it comes to, depending on what kind of company you have, anti-money laundering risk, you might have kickback risk, you might have control risk, accounting risk there.

There’s a world of different risk out there. So if I was a mid market company. I’m gonna go to either outside counsel or hire. If I couldn’t afford a full-time person, [00:26:00] I would have a part-time role and have someone who had compliance responsibility to say, can you risk map the organization? And what I don’t want to do is to deliver training that’s not relevant to people’s roles.

But what I do want to do is to make sure I’m delivering the right training to the right people for the right reasons.

Mike: When you say risk map the organization, dig into a little bit more of what that looks like. Okay.

Richard: Okay? So let’s say I’m just going to use an avatar. I’m a small pharmaceutical company, or a medical device company. Okay, so if I’m a small medical device company, it could even be an over the counter medical device. Okay. There are a number of different transparency laws, and there is something [00:27:00] called the anti-kickback statute, especially if your product is covered by Medicare or Medicaid that are very real risks and the government.

Definitely focuses on healthcare in terms of healthcare fraud. So again, if I’m a mid-market farmer, med device, biotech company, maybe not publicly listed, I would want someone to take a look at that and to say, okay, here’s what you need to have with respect to your interactions with people who work in hospitals, pharmacies.

or doctors. Or Nurse practitioners. A small company may not realize the depth of that risk. And I also want to make clear to your mid-cap companies don’t think you’re under the radar. If you look [00:28:00] at, and I watch the government enforcement feeds. There are small companies, mid companies, and large companies that are getting into trouble.

So, and if you’re a smaller mid calf company, you might not be able to financially make it through an issue because of the legal and investigatory expenses. Not to mention the fines, the other thing,

Mike: this may not just hurt you. This may kill you.

Richard: right. In fact, sometimes the government has had to. Negotiate the fine not to put the company into bankruptcy.

That’s how close it was. And the other thing is, if one day you’re thinking, I want to attract private equity, I want to maybe go to the public markets, they are going to look at your governance structures, they’re gonna look at your compliance structures, they’re gonna look at all of these different things in terms of your risks.

And if you said, well, we don’t [00:29:00] really have anything, they’re gonna have to think about, do we want to buy? What could be a mess that we don’t know about? Because once you buy it from a risk and regulatory perspective, you own it. There’s a little bit of a safe harbor period, but it’s not much. So if you’re thinking about the next step in your corporate life.

Putting a strong ethics and compliance foundation now will carry you into the future.

Mike: And I would imagine even if you make the point, it’s not just about selling internationally, that happens to be your story. But so there’s a lot of other things like the medical device situation you talked about, but also you may not be selling internationally, but for. Most companies that have a product, you may have an international supply chain,which could have impact.

Richard: you beat me too. It, Mike. So [00:30:00] we are in a world now where sanctions prevail. And there’s a whole cottage industry of companies that are relabeling products, for example, to mask the, country of origin and to mask the supply chain route. So if you’re buying products that have been mislabeled, misrouted, circumvented compliance sanctions.

You’re absolutely right and the fines and the potential regulatory exposure on the sanction side is even more draconian than it is on the bribery side. So you’re right this space both ways and thinking about it now, looking at the procurement side, your risk might even be greater given the sanctions regimes that are [00:31:00] out there right now.

Mike: So you talked about this idea of creating a risk map. what are some other actions that a company should be taking, including and maybe I’ll ask about something specific and then we can dive into more actions. Actions. You know, you talk a little bit about the role of a compliance officer or an ethics and compliance officer.

what does that look like? And is that typically a full-time role a, a fractional role?

Richard: You know,it would depend. You want it fit for purpose, so. For most organizations, it’s a full-time role, and you can like imagine there are so many iterations of this for a small growing company, it might be your general counsel also fills that role. Now, that’s ill suited once you get to mid and [00:32:00] large, but you might start off that way.

It could be somewhat on the legal team. It could be fractional, but someone who is there most likely that has a, relationship or dotted line to outside counsel to make sure that all the company’s risks are being addressed, and that might entail face-to-face training for employees that have direct exposure to risk.

It might mean online training for people in sales order processing and logistics, just to have their radar on for what they might see and say, wait a minute, this doesn’t look right what we’re doing here. and don’t underestimate the power of making everyone in your organization an ethics and amba an ethics ambassador.[00:33:00] 

Because those folks in sales order processing and logistics and manufacturing, they see a lot. But if you Just leave them alone, they’re gonna be like, you know what? I get paid to do X, Y, Z. I’m a small gear in a big company. This paperwork looks really dodgy, but it’s not my job to question it. So thi this has to go through the organization.

And that ethics and compliance officer, whether fractional or full time, would basically set up the guardrails. This is what we don’t do, and also set up the, this is the gray zone. This is when you call me, because sometimes what’s permissible and what’s a violation can look very blurry and gray. And we’ve also set up a mechanism, whether it’s anonymous or direct, or email if you have a question, here’s where you go [00:34:00] to speak up.

So those are some of the components of having a strong, at least minimally viable program. And then the next step is to say to your business leaders, you have to be talking about this. If the only people talking about doing what’s right in this company, are people in support legal functions? It sounds like, oh, here, doing what’s right.

Well, we have a department for that, but when it’s coming out of the voice of your CEO, especially your mid-level managers, it sounds like here in this organization, doing what’s right is what we do because it comes through our corporate narrative.

Mike: Yeah, and I would imagine it could send exactly the opposite message. You intend to send. If you say, all right, you know, we’ve got, some junior, junior level attorney on our team or accountant on our team, who’s our, you know, this is the guy, this is our [00:35:00] compliance manager, and I use that word manager on purpose instead of like, chief compliance officer, this is our compliance manager.

It. it looks like this is someone we’re putting in place to give the illusion that we’re doing the right thing, but I’m not sure my company really wants me to do the right thing.

Richard: Yeah, we just, published a, an article in Fast Company on like how to deal with all this. When there’s so much regulatory uncertainty out there and uneven enforcement. we are in now the second Trump administration. You know, there’s a lot of uncertainty with what cases the government will pursue and what they won’t.

And one of the conclusions that we drew is titles matter. Even though they’re formal, they do send a signal of how important. You feel the role is, but you can call someone the Vice President [00:36:00] of ethics and compliance and give them no resources, no respect, no autonomy. It doesn’t really matter. So the respect, the autonomy, the resources also need to be behind that position formally and informally.

Mike: When we talked, Richard, the conversation we had preparing for this, you know, I made a note that you talked about, and you alluded to it a couple minutes ago, is needing to have kind of a code of ethics. and I wanna talk about that a little bit because so many of the companies I work with have a set of core values that are these non-negotiable behaviors that anchor culture.

But I think that’s very different than a code of ethics. talk a little bit more about what that code of ethics might look like and then what you do with it once, once it’s created.

Richard: Great question. So how did those, [00:37:00] so I would share with you. Okay, so the companies have ethics, right? They make great wall posters, by the way, right? Those values that companies have, they’re on their website , and if left alone, they’re aspirational. They don’t do anything on themselves by themselves. So step one is how do these values connect with what we do?

Okay. If I’m a pharma company, maybe one of my values is patients first. Okay? That ties into what we do, manufacturing pharmaceuticals. So step number one, if your values are so vague that you can’t tie them into what you do, then maybe it is time to rethink your values. And there’s never, values are not one and done.

They can always be reexamined. Then number two, what sort of [00:38:00] decisions do you want those values to drive? Right? How do you connect those values to behavior? You can’t connect these lines. That’s a problem. Like we want this value of patient first. To be such that we are only recommending medical solutions, not because we make the most amount of money from this particular product because it’s best for the patient.

That’s an example. Then the next step is what structures do we have in place to support those decisions, right? So we’re connecting values to behaviors, to outcomes, to structures. And I like the fact that you called it a code of ethics, and a lot of companies are moving from a code of conduct, which is policies, rules, and procedures, to a code of ethics, which is [00:39:00] really the heart of the organization.

This is what we do as an organization, and these are how these values connect through the rules, but ultimately to behavioral outcomes.

Mike: Beautiful. What’s for the listener that. Has not thought much about this at all. and hopefully we’re motivating, you listening to take some action. Either you’ve done, maybe you need to take what you’re already doing to the next level, or maybe you’re starting from zero. You haven’t thought about this.

You’ve built this great company, but you haven’t thought about taking this step. What, Richard, what’s one thing for someone that, that’s starting from zero maybe on this, what’s one thing. A leader listening can do to ensure they’re not leading good people to make bad decisions.

what’s one first thing they ought to, they, one first action they ought to take.

Richard: First do [00:40:00] an assessment, right? what are the risks here and what do we have now in place to address those risks? Now that’s granular, right? Like those are guardrail type of things. But I think the other thing a leader can do, and the earlier the better is what’s our mission here and what are the values to support that mission?

And again, like if an I, I want to get more specific here. Like if A CEO feels like, I want people always to feel comfortable to speak up if they have a question or to speak up if they see something that doesn’t look right. The, I want this to be a really psychologically safe workplace and you don’t have different lanes for people to [00:41:00] speak up and raise concerns, then you have a problem because you don’t have a structure to support what the CEO wants.

So the CEO really needs to get their management team together and think about what is it that we want to drive? In this organization and then what are the structures that we need so that people can do what we want them to do and where they feel comfortable speaking up if they’re not sure.

Mike: And I love, you know, you mentioned psychological safety. What, what’s coming up for me over and over again in this conversation is how much of this you can have a code of ethics. You could have your chief compliance officer. This is about the culture of your company and. and I’m kind of rewinding in my brain the work I do with clients, and very often when leaders are working on their goals and they’re working on, I’ll [00:42:00] go back to the core values.

They’re working on core values. So much of it. Is we get shit done. We figure it out like all, and that’s great. I love that stuff. but what you’re causing me to think about is all that stuff’s great, but, and I remember one of my clients had, one of their core values and without a definition behind it, this was like too fuzzy.

But they put a good definition behind it. One of our, their core values over and above, we get shit done and we figure it out was we do the right thing. And when they first said, we do the right thing every, you know, and somebody on the team mentioned that, and everybody said, well, yeah, I get it, but what does that mean?

Like, what’s the right thing and how do we know what the right thing is? but having something around that and defining what the right thing is in a code of ethics and making that part of your culture, I’ll tell you as a coach of leadership teams that you’re helping [00:43:00] me realize that hasn’t been enough.

Of my focus and it’s gotta be there.

Richard: Yeah, doing the right thing is such a wall poster. Like that is so unhelpful unless you have something that’s right underneath it that says what that means in that organization. And then what’s really fun, Mike, and we’re going back to things that an organization and leaders can do is pressure test it.

So for example, let’s say there was a, in one of your clients, there was an incident, there was an investigation, something went wrong. Is to anonymize that and to make it an ethical dilemma workshop and to get people together to say, look, these are the set of circumstances that happen before we tell you what actually happened.

What would you do? What would guide your thinking and get people comfortable [00:44:00] talking about values? Talking about when’s the last time you made a decision that went against your values? And don’t tell me you didn’t because you did. Okay. Because one thing that we know is to say that I am perfectly ethical is in itself an unethical statement.

Okay? Because when it comes to, I think this is an important distinction, Mike, when it comes to rules, policies, and procedures. Those are guardrails. Those are clearly established, right? We don’t pay doctors to prescribe our medicine. Boom. Culture is a journey. Culture. You can have a great code of ethics, but then how is it demonstrated in the decision making of leaders?

So that’s taking people on a journey that takes much longer. [00:45:00] And it takes a long time to build trust, but the first time a leader does something counter to those values, it destroys that trust so quickly,

Mike: Absolutely. It’s gotta be

Richard: especially with the younger generation.

Mike: yeah. It’s gotta be modeled at the top. It can’t just be, to your point, can’t just be a wall poster. It’s gotta be modeled at the top. 

Richard, tell me a little bit, and especially for those listening that may be, may wanna do this but may need some help, How, what? Tell me a little bit about what your business looks like and how you work with clients.

Richard: So what I try to do is to talk about the behavioral side. So typically speaking, when I work with a client, I will look at their values, I’ll look at their codes. I will look at everything that an employee looks at, and then talk about my story and how I [00:46:00] wish I had thought about this before I made a decision.

Yeah, and it’s not scared straight. It’s not just storytelling. It’s if I had just picked up that phone and not felt intimidated and felt safe, that just that one call could have changed the story before it started, and you as a leader. If you are not hearing from people that are facing difficult situations and they’re not calling you, are you picking up the phone and calling them?

So I guess Mike, the best way to describe it would be we have ethics and compliance expectations. We might have rules, we might have codes, and then we have reality. Okay. Commercial realities, whether it’s procurement or sales. And I think [00:47:00] the best thing I can do is to try to get both sides talking because I’m relatable to the commercial people as former commercial Richard, and relatable to the compliance people in what I do now.

And I had one client, we were in Shanghai and the two sides were actually. Having the art of the good fight. They were arguing over processes, you’re slowing us down, you’re making it impossible for us to do business. The compliance people were saying, look, you, thanks for telling us about this.

Maybe there’s a better way we can do this a better way. We can talk to you. And the chief compliance officer who was sitting next to me just leaned back in his chair and he said, I love this because now they’re talking.

Mike: back to the conflict you talked about,to start this whole conversation. So we’ve gone in a nice, circle.

Richard: friction is the best thing in an [00:48:00] organization because when people are pushing back, it means that they’re taking it seriously When they’re not pushing back, it might be that they’re circumventing.

Mike: Beautiful Richard, where we’ll put this in the show notes, but people do wanna find out more about you and your speaking and how you could help. where should they go?

Richard: So I’m trying some new things out. If, they want to go to my website and sign up for my newsletter, like on a monthly basis, sharing different articles, different developments. I have also started writing on Substack, so that’s another place to connect and I’m happy to send you all the links. And then I have a LinkedIn newsletter, so I’m not for Overpopulating people’s email boxes.

Each one of these things is about a once a month cadence. and I’d love to have your, you know, your listeners join this discussion because we all want to [00:49:00] succeed. And no one starts off at a hundred billion dollars, right? We start off with an idea and we grow it, and the sooner we lay a solid ethical foundation, the more it will just organically grow with us.

Mike: Beautiful. So important, to all of us. As I always say, if you want a great company, you need a great leadership team. Richard, thanks for. Helping us get there today.

Richard: Mike, what a pleasure. ​