Wednesday, 3 April 2013

Ian Fletcher, John Key and dodgy partisan appointments

This is what happens when you have a culture of corporate governance in a democratic institution.

Joyce and Key are both corporate governance masters.  And they set a great deal of the culture of the Cabinet, and thus of the behaviour of the senior civil servants who support the Cabinet in their day to day work.  And they don't recognise the difference, the very important difference, between corporate governance and actual democratic governance.

In a corporate environment the Right Thing To Do is often what you can get away with for maximum gain.  It's about not getting caught, rather than acting with integrity in the first place.  If you do get caught then the focus is not that you did something wrong, or even that you got caught, it's how you manage being caught out; shifting blame, constructing plausible deniability, brain fade*, whatever.  Not everyone plays it this way, but the collapse of many finance institutions in the last few years has surely taught us that a great many do, in particular those in the areas of currency speculation, hedge fund managers, etc, who are seeking to make marginal gains very quickly by shifting around huge amounts of money for no other reason.  It's ok for Key to manueoruve a high level post for an old friend, it's ok for Ministers not to front to major news institutions for months on end on topic issues, it's ok for us to never know why a Minister was sacked.  Because in corporate governance those are all within the rules and acceptable.  Move on, nothing to see here.

I'm not saying the corporate governance model is better or acceptable or even slightly ok.  Again, the events of recent years have shown us exactly why it isn't; because it gives incentives for the wrong types of behaviour and appears to reward those who act in ethically dodgy ways when they don't even wear most of the risk themselves.  That Kiwisaver campaign that suggests you join Kiwisaver or you work until you die - there are plenty of people who thought they had saved responsibly for their retirement who have had to go back out to work, at a time of high unemployment and a lot of discrimination on the basis of age because people who got bailed out to the tunes of billions of dollars were reckless with money that wasn't theirs to play with.

In democratic governance the standards are different.  For a start there are a whole lot of rules.  And those rules are there for Good Reasons.  They recognise the extreme level of power that politicians, especially senior politicians, possess, which they may use to advantage themselves and their friends when what they are supposed to be doing is serving the broader electorate. 

Appointments are a particularly crucial area.  In recent times we have had Judith Collins appoint a close friend of her husband to an important role, Tony Ryall's neighbour end up Race Relations Commissioner, lots of ex National MPs (or wannabes) on the Human Rights Commission, and now an old school friend of John Key's is the only person interviewed for a role where it seems he had limited previous relevant experience. 

Government are obliged by law to be an equal opportunity employer.  While usually this is taken to mean jobs are won on the basis of skill and best fit rather than gender, ethnicity, sexuality, or other irrelevant attributes, it also means that anyone with the relevant skills etc should have the same chance of getting the job as anyone else.  Even when anyone else happens to know someone who is a very senior politician. 

Why is this so important?  Partly because the civil service is supposed to be politically neutral, and it's hard to maintain that if some staff are there due to the patronage of particular politicians.  But also because it is actually good appointment practice.  How many times in your paid work experience can you think of someone who got a role because of who they knew rather than what they could do?  And how did that work out? 

What bothers me the most about all of this is that the politicians involved do seem to genuinely think that they haven't done anything wrong; that their corporate approach is fine and dandy.  It's not.






*  And as someone who has suffered from a medical condition that at times caused actual brain fade in the past, it was so debilitating that I couldn't hold down a job at the time, or study.  So if we could stop blaming brain fade as if it isn't something that happens to real people that'd be nice. 

10 comments:

Lindsay Mitchell said...

"Government are obliged by law to be an equal opportunity employer. While usually this is taken to mean jobs are won on the basis of skill and best fit rather than gender, ethnicity, sexuality, or other irrelevant attributes, it also means that anyone with the relevant skills etc should have the same chance of getting the job as anyone else."

I am pleasantly surprised to read that gender, ethnicity and sexuality are irrelevant attributes when it comes to getting jobs, and skill and best fit trump. I could have written that. Have you told those feminists in the Labour Party who want to impose gender quotas on electorate committees?

Sara said...

I absolutely agree with this. I am also mindful that all flavours of government operate in this way, to a greater or lesser extent.

Julie said...

Nice derail Lindsay. When an organisation or institution or whatever has heaps more men than women in leadership roles then I think it is reasonable to ask why and encourage a re-balancing of the situation. Because it isn't as if men are inherently more skilled at this stuff than women.

Sara, things don't have to operate that way though - I've been involved in politics of varying kinds for the last 18 years and I've seen people operate in dodgy ways yes but I've also seen other people operate with great integrity, even when it is to their disadvantage. It can be done, and it should be done, and politicians such as myself have a vital role in encouraging a better culture.

Alison said...

"Nice derail Lindsay."

Do as I say, not do as I do.

Facts said...

You've said some very nasty things about corporations here, Julie. I would give specific examples but the fact that you use 'corporate governance' as the opposite of 'democratic governance' is pretty revealing. Do you really think all corporations operate this way?

Julie said...

I have certainly compared some approaches to corporate governance with what is required in a democratic institution's governance and drawn an unfavourable conclusion. I would have thought that some of the many many examples over the last few years of very dodgy governance in many large corporates, in the finance sector in particular, would have made others sceptical about the culture of governance in the corporate world, but perhaps not you Facts.

Facts said...

It's true that lots of corporations have mad bad, irresponsible and even corrupt/illegal decisions.

I just question whether the very fact that it is a corporation making the decision is the problem.

I could also point to several failures by democratic decision making bodies. I wouldn't generalise that to say 'democratic governance doesn't work'.

You see this is part of the negative stereotype of the left that I often hear but thought was just right-wing propaganda - that the left thinks all businesses are innately bad. I thought the left was just holding business to a high standard. But when you say 'corporate governance doesn't work (or stuff to that effect) you are effectively saying that corporatiosna re incapable of making good decisions just because they're corporations and that's a big call.

Rory said...

I think that the point is more about the lack of ethical behaviour demonstrated by members of the current government.

The fact that this behaviour draws parallels with recent high profile corporate failures is a parallel worth exploring, the issue transcends political leanings.

Both government and business decisions need to stand up to ethical rigour and when they don’t we should be able to question it and seek redress.

Unknown said...

It is important to understand two things. The first is that corporations are, by the very laws and structure that define them, sociopathic. They have NO social conscience (other than what is imbued in the corporation by the board members running it) and they have one principle motivation, make more money. No questioning how. This implies a very weak set of ethical limits on its actions, and that is what we see.

The second thing is that a sovereign nation, this country, is NOT a corporation, and has a vastly different set of goals. "NZ Inc." doesn't really exist. To the extent it does, it is a mistake.

bjchip said...

It is important to understand two things. The first is that corporations are, by the very laws and structure that define them, sociopathic. They have NO social conscience (other than what is imbued in the corporation by the board members running it) and they have one principle motivation, make more money. No questioning how. This implies a very weak set of ethical limits on its actions, and that is what we see.

The second thing is that a sovereign nation, this country, is NOT a corporation, and has a vastly different set of goals. "NZ Inc." doesn't really exist. To the extent it does, it is a mistake.

My apologies and please take out the previous post. I did not intend to be anonymous - thought it would turn up from my google account.