Applying the transparency taste test

Last week I was in Berlin as the guest of SAP and Transparency International. For those that are unfamiliar, TI is a pressure group that addresses issues around corruption.
Written by Dennis Howlett, Contributor

Last week I was in Berlin as the guest of SAP and Transparency International. For those that are unfamiliar, TI is a pressure group that addresses issues around corruption. It operates in some of the most difficult parts of the world. It tends to focus on the governmental factors impacting corrupt practices though in recent times it has started to exert more pressure on business.

I was there along with fellow Irregulars James Governor and Thomas Otter to explain the value of 'openness' in the context of community building. James Farrar, who is Vice President Corporate Citizenship at SAP facilitated our attendance. We must have been doing something right because we were later advised that certain attending TI executives canceled meetings to hear us out. OK, so that's nice and all but what on earth does this have to do with enterprise?

In an email conversation, James Farrar said:

Our industry needs to consider these issues much more and not only anti corruption but also human rights, labour rights, social and environmental impact (beyond clean tech), economic impact. Net Net ---- the tech sector can enable such good things to happen but the awareness needs to be there and the conversation needs to be socialized before the innovation can come. Objectively, sadly, the tech sector and especially the software sector have been perceived to be behind the curve. More positively I sense huge latent interest.

As I said at my personal weblog, with the possible exception of HIPAA and SOX, there are no standard business processes for dealing with any of the issues arising out of corruption or any of the other voluntary and regulatory codes. There is instead a good deal of consulting to be had as evidenced by these growth figures from the Big Four. TI has developed some tools covering bribery but as we were reminded during our meeting, arrangements with business are voluntary.

I came away from the meeting thinking there is a real opportunity for the software industry to do something good while at the same time providing services customers will want to buy. I also came away with questions:

  • What price reputation based upon de facto global standards on broad range topics like employee relations, workers' health, reporting of money laundering activities?
  • What kind of non-financial measures and business KPIs will we need to develop?
  • How are measures going to agreed upon?
  • What partnerships will the industry need to form?
  • What influence could the software industry bring to bear upon the development of standard business processes?
  • How will industries be persuaded that transparency really does have long term business value?
  • What kinds of systems will 'we' need to bring this happy state of affairs about?
  • What are the time lines for getting CSR standards in place that have teeth and are auditable?

These are big questions, some of the answers for which lay in existing GRC software with an appropriate amount of consulting included. The reality is that software will need to be an enabler of collaborative community. That's because the issues TI is tackling affect all of us engaged in a financial supply chain with profit at the end. Effective action can only take place in an atmosphere of goodwill which requires collaboration. Once you scratch the surface, goodness knows there is precious little of that among Silicon Valley competitors.

We were in Berlin to offer our experiences. The question I never put but perhaps should: As an industry, are we prepared to not only help our corporate customers but behave as we would wish others? This example from Cisco as reported in the FT is the kind of thing I am thinking about:

A director of the Brazilian unit of Cisco Systems, the US technology giant, has been fired after being formally charged with tax fraud and other crimes involving evasion of up to R$1.5bn ($845m) in import duties and other taxes.

At first glance it seems great. Cisco takes swift and decisive measures - all upside. But I want to know what potential effect evading $845 million has on the company's affairs. Where else might there be problems given the relatively corrupt environments of the BRIC countries? That's not stated anywhere in the article. This is a much more complex topic than simply creating policy documents and processes around those. It means in process enforcement and may also mean across corporate boundaries. That's not an easy ask. I hope the industry does its best to unravel the complexity and make it cost effective. Business doesn't need another SOX or Y2K. But it does need to deal with issues around transparency.

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