Confidence and Corruption in Organizations

A Question of Confidence

Your mom is in hospital waiting for a critical surgery that could save her life.

The surgeon is a middle-aged man who seems to be warm, kind, and attentive.

Yet he’s total stranger to you. You know nothing about his credibility or track record.

There’s one thing you know for sure: however your mom’s surgery goes, the surgeon won’t be accountable or responsible for the outcome. If he made wrong decisions, did professionally irresponsible things, or violated ethical standards during the surgery, he wouldn’t be investigated or punished. In fact, he wouldn’t even be questioned. If he did something terribly bad, he could walk out of the hospital and land a shiny new job at another hospital.

Now think about two questions:

Question 1: How confident would you be in thinking that the surgeon will do his best, both professionally and ethically, to save your mom?

Question 2: If you could choose, would you allow him to do the surgery for your mom?

The Importance of Having a Stake

If someone had zero stake in what she does, how confident would you be in proclaiming that she will likely do her best?

That’s the problem with many of the powerful positions in organizations nowadays.

If we don’t have effective and efficient ways to put people with power in check, then it’s highly unlikely that we’d have the confidence of their good will.

Now think of the defined processes, frameworks or policies in your organization:

• How many of them specify who approves what and who makes the final decisions?
• How many of them specify resolution protocols for “what if” scenarios, and specifically, “what if the decision maker was wrong?”

If your answers account for a lot in the first question but few in the second, you probably should wonder: why?

If barely anyone can put powerful people in check effectively, efficiently and timely, then it probably means that those powerful people have no stakes – not in the sense that they don’t have a stake in the outcome (they do), but in the sense that they don’t have it in acting with good will, and, more importantly, they don’t have a stake in fixing the structural problems in the organization itself.

That’s commonly known as “lack of democratic oversight,” both in society and in organizations.

What Overrides the Stake?

So what’s overriding the stake exactly? Why democratic oversight is lacking?

The short answer is that, even though some of us live in an arguably democratic society, most organizations are operated in a way as if they are authoritarian.

In other words, many organizations around the world are largely operating through authoritarian processes, authoritarian rules, and authoritarian power structure.

In an authoritarian rule, you merely don’t need democratic oversight, because you wouldn’t need any kind of oversight to make things work.

A Second Question of Confidence

You’re a renowned doctor diagnosing a kid called Cindy. Instead of listening to your advice and suggestions, Cindy’s rich father makes demands and wants to have you do this and that to Cindy.

In fact, he doesn’t only make demands, he also directly intervenes your diagnosis process as well as the hospital’s operation that directly influence how you work.

Yet, he holds you accountable for the outcome, and he’s going to hold you accountable the mafia way.

Question: how confident would you be about properly (even if not successfully) doing your job of saving your kid patient Cindy?

Institutional Corruption Refracts Accountability by Reducing Confidence

Confidence is a critical element in any democratic social system.

When we’re not confident that our representatives actually represent both us and our interests, it says more about the system that gives rise to those representatives than about us.

That’s why confidence is also a key factor in institutional corruption, where incentives are placed in the wrong places, and people in power act out their power in a way that’s driven more by those incentives than by their nevertheless good intentions.

Unlike individualistic corruption (such as the classic “quid pro quo” scenario) that deteriorates trust, institutional corruption deteriorates confidence.

Specifically, it deteriorates people’s confidence in one thing: powerful people’s tendency to act in goodwill, especially when it comes to their goodwill in establishing a democratic oversight that can actually put anyone in power — including themselves — in check.

Are you seeing refractions in your organization?

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