Bernie Madoff Reminds Us of the Need for Open Communication and Ethics

There is a revival of interest in Bernie Madoff now that the eminent TV program 60 Minutes profiled his family (Oct. 30, 2011). It is a reminder to us all about the value of reputation. I give a speech on branding. I ask my audience if they could imagine the image that their own name would conjure. I then list the following names and show their pictures:

• Mohandas Gandhi
• Mother Theresa
• Martin Luther King
• Hitler!

The flinch at that last name is palpable, especially after the admiration and good will expressed for the others. (Stop and think: When was the last time you heard a reputable family name their son “Adolph?")
Peter Drucker noted that "ethics stays in the prefaces of the average business books." Consider the long line of lies told by a famous oil company when it had a massive spill off the Louisiana coast. The company listed lists otters, sea lions, seals, and walruses as "sensitive biological species" that deserve protection in the Gulf of Mexico. However, there are no otters, sea lions, seals, or walruses in the Gulf of Mexico. They listed emergency phone numbers for mammal specialist offices in Florida and Louisiana that were no longer in service. And their spokespeople proudly stated in their disaster plans that, "under the worst-case spill scenario," it could skim, vacuum, or otherwise remove as many as 20 million gallons of oil a day. In fact, they captured only about 630,000 gallons a day.
Even the best companies often obfuscate in their annual reports. Some may say that "We performed well in a difficult economy," rather than say, "We didn't make our numbers this again again."  Or they may state that "We have a healthy backlog," rather that "Our manufacturing inefficiencies keep us from meeting our delivery goals."
Conducting business in a socially responsible way is, in the end, a sound business practice in and of itself. It allows you to attract the best employees. It helps create an atmosphere in which quality products are produced because your people will proudly stand behind them. Trust helps maintain good relations with people and institutions such as your employees, your shareholders, the media and the local community. Your word becomes your bond, as good as a contract. But most important, it is the best branding possible. After all, if you can't be trusted to keep your story straight, why should your customer trust your products or services? So I encourage all business people to build their trust in the following ways, as I have helped my clients in my role as a professional communicator:

• Inform your employees of the state of your business regularly through face-to-face meetings and publications.
• Issue press releases and meet with members of the local media so that they learn to trust your word.
• Address members of your community and build relationships with your elected representatives.

"I would rather be the man who bought the Brooklyn Bridge than the man who sold it," said Will Rogers. The name "Madoff" is now a synonym for "swindler," and all financial planners now operate under a cloud of suspicion.  Indeed, the hell through which Bernie Madoff put his family, his employees, his customers, and even his colleagues is an argument for both ethics and transparency.