Will your business choose ethical standards?

“He will call upon Me, and I will answer him; I will be with him in trouble; I will rescue him and honour him. With a long life I will satisfy him and let him see My salvation.” Psalms 91:15-16 NASB

Eraston forwarded an insurance claim that his car had burnt down as he travelled upcountry. The document was forwarded to an assessor. Before the assessor presented his findings to the insurer, he confronted Eraston with the evidence.

“Would I be correct if I said that the car was stationary when it caught fire? Would I also be correct if I said that the fire started in the front seat of the car and not in the engine as you claim? Would I be correct if I said that all the doors and windows were closed with the exception of the driver’s window?”

Eraston, who came to the meeting expecting that his claim would be passed for payment, began to curse, first muttering under his breath and finally shouting expletives at the assessor.

When he calmed down and examined the detailed report he meekly said “I agree; how can you help me?”

The assessor referred him to the insurance company to whom he had made the claim.

Kariuki Kigo, CEO of Safety Surveyors Ltd, a local family owned risk management concern, admits that accident investigations especially where fires are concerned pose an extremely high risk to the ethical family business.

Unlike Eraston’s case above, majority of fire claims made to insurance companies involve large sums of money.

When investigations show that buildings, tankers or other property were deliberately set on fire, the report that denies the individual compensation for their property can ruffle feathers. When such reports go against cartels that routinely benefit from such criminal activities, they pose a threat to the investigator.

Fraudulent claims

As the frustrated CEO of a local insurance company mentioned at a conference on ethical leadership, the growing number and magnitude of fraudulent claims is causing a grave concern.

Even more challenging is that such rackets involve individuals at senior levels of management who ought to be custodians of organisational values.

Yet for more than 26 years, Kigo and his family have continued to run this business without compromising their core commitment to integrity and ethical conduct.

He has been verbally threatened, has had menacing texts sent to his phone and, on one occasion, has had individuals coming in three vehicles in the dead of night to “see” him.

Yet Kigo and his family remain unfazed. While other investigators and assessors compromise their reports in exchange for cuts of the compensation and repeat business, he presents findings as they are, leaving the choice of compromising on ethical commitments to insurance companies.

Family business that wish to stay ethically engaged in hazardous areas in which there is a more than ordinary exposure to risk can only do so if their ventures are based on clear values and a distinct noble cause.

High-risk business

Because human beings tend towards evil, such businesses will always be under threats against which the Leader of Family Business ought to firmly stand even when that puts the venture’s livelihood at stake.

Only then can such ventures exist in the long term.

The nature of some business ventures is such that they carry the risk of encountering individuals who stand to gain from corrupting systems and processes.

Unless the Leader of Family Business in such a market is soundly grounded in values, they will eventually compromise on their commitment to ethical business.

Leaders of Family Business in high risk business ventures ought to recognise the limit of their responsibility so as to avoid turning their ethical standing into a crusade and eventual burnout.

Leaders in high-risk environments ought to put their safety in divine hands as they carry out their patriotic duties.

Doing this provides them and their families with the comfort of heart that allows them to concentrate on their life’s purpose rather than the threats they face.

Mutua is a Humphrey Fellow and a leadership development consultant focused on family businesses. His email address is [email protected].