Be above board
Saliya Pieris is a President’s Counsel and the President of the Bar Association of Sri Lanka (BASL)
No legacy is so rich as honesty,” William Shakespeare said wisely; and it is a quality that remains central to organisational success and our daily lives. Weighing in on this, Saliya Pieris says: “I believe that honesty is important in any organisation because firstly, it is the right and proper thing to do.”
He adds: “Being honest is the ethical responsibility of a business and of those within it. Although in the short term, it may appear to be less fruitful, honesty helps build the reputation of any organisation or an individual in the long term.”
Pieris believes that being honest enhances credibility and in an organisation, it also leads to building trust among its members. Honest dealings also build trust between the organisation and those it engages with such as customers or clients.
So is honesty as important even when an organisation is posting outstanding financial results?
Pieris replies: “Yes, it is! Honesty is most important when an organisation is doing well. Dishonesty destroys trust and reputations, be it organisations or people. We have seen organisations apparently doing well and collapsing due to dishonesty.”
“The classic example is Enron in the US, which collapsed due to corporate greed and dishonesty. Within months, its share value plummeted. In the end, some of its directors and auditors were charged and jailed,” he recounts.
In that case, how do companies ensure honest dealings in a cutthroat business environment?
Citing the Harvard Business Review (HBR), Pieris quotes: “Although there’s an assumption that stress and pressure push employees to perform more, better and faster, what cutthroat organisations fail to recognise is the hidden costs incurred.”
He emphasises that although cutthroat business environments are perceived to be productive, in reality they’re not: “In such circumstances – even in a cutthroat business environment – the principles of honesty, transparency and integrity remain valuable. Therefore, organisations must foster cultures that promote these values, and reject dishonest and corrupt practices.”
Dwelling on the benefits that honest and transparent companies reap, Pieris remarks: “By being honest and transparent, companies enhance their credibility, which creates confidence among people who deal with them as well as among their own employees.”
And he adds that “in all probability, creditors and investors would be more confident in dealing with companies that are honest and transparent rather than with those with chequered records. Furthermore, by being honest and transparent, there will be more ease in doing business.”
Commenting on corporate accountability or a lack thereof, Pieris explains: “Sri Lanka’s regulatory framework needs strengthening – especially in the criminal aspect. We do not often find companies or their directors being dealt with for corruption or corrupt practices.”
“Although bribery is technically an offence, people who do so and induce public officers to take bribes are hardly ever charged or punished,” he elaborates, adding: “We know that many malpractices exist at many levels in procurement procedures. Many of these go undetected.”
Clearly, much more can be done to tighten regulations for corporates in this regard, right?
Pieris responds: “I believe any anti-corruption regime must cover the corporate sector. As much as there are laws to deal with corruption in the state sector, private entities contributing to state corruption with their dishonest dealings and by offering bribes or commissions must also be investigated, charged and punished if they’re found to be guilty.”
He goes on to say that laws such as the Bribery Act would thus need revamping: “Companies and their directors ought to be taken to task for dishonest practices. There are Asian examples such as South Korea where prosecutors have pursued top corporates and their leadership for corrupt practices – something Sri Lanka should aspire to do.”