Culture of ethics: Should Nazir Razak resign?

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Photograph: ideas.org.my

By setting an example and paying the full price, Nazir Razak would not only redeem himself but also CIMB’s high standards, says K Haridas.

One must commend Nazir Razak for taking leave as chairman of CIMB Bank until the review of the Anti-Money Laundering Act (AMLA) process is complete.

The fact that he was the CEO prior to this does not exonerate him from the fact that he had knowledge of AMLA. As human as he is, he overlooked these facts to do a favour to his brother, who is none other than the prime minister and finance minister of Malaysia.

Nazir should have come clean even prior to the disclosure by the Wall Street Journal that he had received US$7m in funds that were transferred to his personal bank account from that of his famous brother. Obviously the money came in prior to the general elections.

For Tengku Zafrul to clarify that the board was conducting a review and not an investigation shows the level of the high standards of corporate governance practiced by CIMB. Can’t blame him for this – seems to be the prevailing culture within GLCs.

Additionally, this further credits the Wall Street Journal for its investigative might and for Nazir to have candidly responded and agreed to the concerns raised. Would any of our mainstream media have done this? This is why many Malaysians have regard for media like the WST, the New York Times and Sarawak Report. Without them our cause for what is right would be greatly weakened.

While he is definitely better than his brother, the fact remains that this has been in the wraps for nearly two years. So donations are not liable to tax!

Why have they both not been called up by the income tax department? Surely such income is also liable to tax. This is a clear example of the complicit nature of GLCs, the politicians and the civil service. The same, I suppose, must have been done with many other GLCs and organisations linked to Umno politicians.

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There appears to be one rule for Umno politicians and their families and another for the rest of us Malaysians. Had Lim Kit Siang done this to his son Lim Guan Eng, all hell would have broken loose and the self-righteous expressions by Umno politicians would have resulted in police reports and criminal charges being filed.

The review being held by CIMB will decide whether Nazir continues to maintain his position in the CIMB Group. As this is not an investigation but an internal review, this could be very subjective.

Nazir would do well to resign and take full responsibility and maintain the self-respect he still has despite this issue. This will speak volumes about the high levels of corporate governance that CIMB practises – rather than put his colleagues and CIMB further under the spotlight.

As for the government and his brother, the less said the better. The prime minister and finance minister is daily defining himself though his poor conduct and behaviour.

There will always be a default culture operating. The example of those managing and providing leadership will define the organisational culture. There may be a vision and mission statement and even an ethics code.

But unless senior management walk the talk, these remain mere scraps of paper that provide fashion but with very little substance – as the practice of democracy in Malaysia is daily illustrating to us.

Where an organisation has in place its own code of conduct/ethics, an ethics counsellor to manage the same, it is different.

What does a code of conduct/ethics offer? It clarifies for everyone and determines the boundaries of operations, clarifies the expectations, affirms the pledges, compliance requirements, whistleblowing rules, fair labour practices, the giving and receiving of gifts, to mention a few broad areas, in addition to the discipline and the behaviour expected from all who work within the organisation.

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Progressive companies clarify their values, their core principles and expectations both for their employees, vendors, customers and the many stakeholders they interact with in the course of their business. Several of these companies are clear on corruption and integrity. They operate well above the legal requirements and attract talent who buy into their philosophy.

The default culture explains itself. The very fact that there is so much corruption in the country is evident from the regular exposes that continue to shock us. The latest being the sports ministry and the missing RM107m. No one takes ultimate responsibility? The secretary general should have been held responsible. Who is ready to take the moral and ethical stand when the head is rotten?

All this says a lot about the default culture within the government. We have had so many examples that the quarterly government audit reports highlight. The government talks a lot about its great ‘transformation policy’ but the gap between the policy and reality gets ever larger.

“People First, Performance Now” is another hollow slogan. The default culture that is visible is one of serious corruption, mismanagement and a total lack of accountability.

The events relating to 1MDB continue to surprise us. Lie after lie with fresh announcements to cover up an earlier lie. Malaysians are not that stupid but stand aghast at what is going on.

This is where Umno has taken us – complicit with MCA, MIC, MyPPP and Gerakan, to mention a few. They are all silent. Surely they would be shocked by the credibility crisis and the evident trust deficit; yet they all choose to remain silent.

Where do you have laws passed by Parliament that protect the wrongdoings of the government? The Official Secrets Act and the recent arrest of Rafizi exemplifiy this clearly. Sue him if he has said something wrong. But to use this act shows bad intent on the part of the government.

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Definitely the OSA was passed with national security concerns and not to hide corruption. Even those who stand up for the rakyat seem to be punished.

The culture of loyalty, cronyism and nepotism breeds corruption. This is the default culture now, evident within the Malaysian government. Those with intelligence and who realise that a grievous wrong is being perpetuated on citizens are being silenced.

I salute the courage and firmness exhibited by Rafizi Ramli, a representative of the people. We at the Business Ethics Institute are constantly challenged by the widely held cynicism and pessimism and this does not make our work any easier.

The government hopes that the ministry of integrity, transparency and human rights would absolve it of its shortcomings. What a sad day for the minister and for the cause he represents. Culture is not created overnight but its lack is so very evident, and there is little that the minister can do under the circumstances. By staying on, he only discredits himself.

What a pathetic situation to be in when we cannot even hold our leaders accountable. This only highlights the rot in the system. The more individuals excuse themselves because of their name and position, the more will we sacrifice ethics and values for expediency.

“Silence as a resource is free and as we take time daily in quiet we develop our moral and ethical muscles. We start with ourselves and tap into empowering values and internalise these in our lives. We then develop our capacity to walk the talk. This is what is meant by Ethics on two legs and such role-modelling by the CEO has a compelling impact on any organisation.”

By setting an example and paying the full price, Nazir Razak would not only redeem himself but also CIMB’s high standards.

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Lee P L
Lee P L
21 Apr 2016 8.44am

This cabinet is the first in the nation’s history which saw a need to appoint a Minister of Integrity. Walao, eh! Such a clever and intelligent PM, we thought, then.

But, [1] the selected candidate has left much to be desired and surely must have smeared the TI reputation, [2] the Minister’s performance is but an excuse and does little except making excuses for his boss, and [3] again policy and deeds are hugely divergent as in many of the other schemes hatched by this … ex-PM’s son.

Although he is Christian, I hope karma applies to him, too. And, may he do the right thing before it is too late.