More than 500 people came to the Lipscomb campus Thursday to celebrate the launch of the Dean Institute for Corporate Governance and Integrity and hear observations about the state of ethics in U.S. business from one of the leading national experts in the field.
Ben Heineman, Jr., former global senior vice president and general counsel of the General Electric Company, led a worldwide effort to make business unit leaders accountable for both profits and integrity. After retirement, he became a senior fellow at the Belfer Center for Science and International Affairs at Harvard University’s John F. Kennedy School of Government, and is a founder of Transparency International, a worldwide organization that fights corruption in both business and government in nations around the globe.
Heineman said he was happy to be speaking to Nashville businesspeople at a time when America was suffering “an enormous crisis in trust in capitalism.”
“What saddens me greatly, and makes the announcement of this institute so important, is that we have had a massive failure of business leadership in the last few years.”
In the Enron and WorldCom age, a few business leaders busted through the system and perverted the system to profit through unethical dealings, but in today’s crisis, all the systems failed.
“We have a situation where all the systems failed. It wasn’t just the CEOs, in fact oftentimes the CEOs didn’t even understand exactly what they were doing. Finance failed, accounting failed, legal failed, risk failed, leadership failed, top leadership failed, the boards failed. They all failed.
“The work of this institute, the work of this school is critically important… because it is far better if we can have high performance with high integrity inside the company…. Rather than have regulators, who are very imperfect instruments at best, take these things over.”
-- Ben Heineman Jr.
|Ben Heineman Jr. and Lipscomb dean of the College of Business Turney Stevens.
The Dean Institute at Lipscomb will work toward that goal by examining the role of integrity in corporate decision making and encouraging the best possible governance practices for both boards and management. Its programs will offer an academic forum and executive education for public and private companies, not-for-profit organizations, and higher education students seeking a role in making the future better.
“This is an extremely difficult time in American history when people across the country are questioning the very nature of our corporate institutions and wondering where we go from here,” said Turney Stevens, Dean of The College of Business at Lipscomb University. “Our nation needs an honest conversation around the issues of corporate governance and integrity, and the Dean Institute is proud to take part in that dialogue. Our goal is not to lay blame for today’s problems, but to seek out best practices that will help corporations move forward.”
The launch event on Thursday featured not only the comments of Heineman, who recently wrote a book on business ethics called High Performance with High Integrity, but also featured comments by various local business leaders and a Lipscomb student:
- Charles W. Bone, chairman of Bone McAllester Norton PLLC, the co-founder of the Dean Institute.
- William F. Carpenter, III, president and chief executive officer of LifePoint Hospitals, Inc.
- Joyce Espy Searcy, president and chief executive officer, Bethlehem Centers of Nashville.
- Sheena Lee, class of 2009 at Lipscomb University.
- Robert E. McNeilly, III, chairman, president and chief executive officer of SunTrust Bank, Nashville.
Bone, who has served as a member of the boards of directors of both public and private companies and financial institutions, said he had always made ethical decisions by asking the question, “Are you prepared to defend the action you are about to take when it shows up on the front of the newspaper.”
Carpenter, who oversees 48 hospitals and 20,000 employees, said he works to have each employee know that,” All we have to do is get it right… today. And we’ve been doing that for 10 years.”
Carpenter also commented on the importance of establishing the Dean Institute, an organization devoted to promoting ethical business practices, particularly in these troubled times. “Boards of directors need guidance. They need a place to turn. I think there is a real need here in Nashville,” he said.
On Thursday, Heineman also spoke with Lipscomb students and with selected representatives from the sponsoring companies, which included:
- NASBA center for the Public Trust (presenting sponsor)
- Ernst & Young
- Seigenthaler Public Relations
- Corporate Board Member Magazine
- Nashville Business Journal
- Lattimore, Black, Morgan & Cain
“There are two things that create great companies. The right balance between risk taking and risk managing…. We of course have to innovate and create. It’s the genius of our system,… And of course we also need high performance with high integrity.
“So guess what, boards ought to think about those specs as the core specs when they hire a CEO. We don’t do that. They ought to figure out how to compensate people for having that essential balance at the core of the company. We don’t so that. We ought to have management and development systems that train people to have those skills, and that balance, and reward it. And we don’t have that.
“So we have a long way to go, but I’m an optimist. We can change, and I think it is with mechanisms like the Dean Institute that we can start down that path of restoration that I think is so necessary.”
-- Ben Heineman Jr.