Goldman Sachs has brio to burn. Slapped with civil fraud charges by the U.S. government last week, the global investment and securities firm also came out with first-quarter earnings of 91 per cent, year over year.
Driven by the profit motive, financial corporations appear to have ditched transparency and its close cousin integrity. Indeed, the concept of integrity seems as faded as an antimacassar.
Barbara Killinger, a clinical psychologist in Toronto, writes extensively about ethics and workaholism, and recently updated her 2007 book, Integrity: Doing the Right Thing for the Right Reason. Here she discusses her impressions of recent events in the troubled corporate biosphere.
Are the financial troubles caused by loss of integrity in our culture?
First, it's important to look at the core of what's going on here. I think the lack of transparency is at the core of the Ponzi schemes and Bernie Madoff and the Enron scandal and Earl Jones in Canada.
If you look at what the U.S. securities regulator is zeroing in on, it's this lack of transparency. That's one of the problems in the breakdown of workaholism - it's this need, where integrity is lost, for secrecy and privacy.
Does knowing you're protected by that secrecy and privacy erode integrity?
Well, there are two dynamics that lead to the breakdown of integrity.
The major essence is the loss of feeling. If the "feeling-being" part of them worked, these people could not do this, because of the impact on other people.
If you're after control and power and that's all that matters - the "doing-performing" side of you - the feeling-being part disappears.
Then the person just gets more and more obsessed.
And so obsession leads to narcissism and narcissism is the real evil.
Narcissists believe they're right. [Just]look at the denial of the president there, the CEO, protesting that they're doing this for the good of society, etc., and people going off to jail still saying they're perfect.
It's interesting that this is happening in companies - a group of the powerful at the top. Is the loss of integrity contagious?
It's because they also have that value system. Succeeding, greed and doing well is all-important.
The workaholic organization, usually run by a workaholic, develops the same values as the breakdown occurs. If you've got a hard-core workaholic running [the company] there's no guilt for poor behaviour eventually.
What happens when the workaholic has lost his or her integrity, and is then smacked with some consequence?
They have such strong defence mechanisms. They can get into disassociation, compartmentalizing, which are very dangerous defence mechanisms. And if someone displeases them, they can get rid of them. They really rule with fear.
What about calling out your institution for having a lack of integrity? What do the lower-rung employees at a troubled financial corporation think? Do they feel completely powerless?
They do feel powerless. They have families to look after. People try to tough it out, but they go home every day having done things they're not proud of. This is coming from the top, this whole idea, is the employees might not see the duplicity in that it was a rigged sale.
You mention in your book that our culture of gain has helped to erode integrity. And in light of the recession - with so many bankruptcies, people drowning in credit-card debt - might people revisit integrity?
It depends on whether they think the recession caused the bankruptcy. If you've been dealing in corrupt things, it's very, very hard to get a workaholic, because of the narcissism, to come in and get help. And if they do, it's usually because something's happened to them.
A personal tragedy?
Yes, it almost takes that. But the hardest thing in the world is to develop feeling when you've lost it.
So is there anything a big corporation can do to rehabilitate itself? And what about future prospects for corporate up-and-comers?
It's very easy for narcissistic traits to develop. If these people can learn [about the importance of integrity]while they're still students, they aren't going to stay at [a company]they don't think is being run with integrity. But it's education in school and education in the family - hopefully these horror stories and these regulators will make a difference. It's so sad they have to bring in such regulators.
Do you see a shift among companies toward making integrity a focus in their organizations?
If things get so bad, then it forces a correction. So there's hope.
Editor's note: Due to an editing error, Barbara Killinger was incorrectly quoted in a previous version of this online article. This version has been corrected.