Why CEOs can’t stand together in crisis
Ever imagined a bank CEO getting slapped in a board meeting? Or a CEO changing his name through an affidavit to save his job just because it annoys the owner of his bank? These are real-life events that took place in our banking sector in recent years.
The banking sector is rife with such hushed rumours, and we wonder what happened to the practice of having each other's back.
Recently I was invited by a close friend at a dinner party where I had the opportunity to be a part of a discussion with former and current CEOs of banks. At one point the issue of resignation of several bank CEOs in recent times was raised and all agreed on how corrupt and motivated board members can be.
One of these CEOs who resigned happens to be an old close friend of many who were present. To my utter surprise, instead of supporting the reasons for resigning, there was hardly a word of sympathy for him – so much so that at one point, one of the CEOs cut into the criticism with "Look guys, we have known him long enough to know he is a man of integrity, so why can't we all stand by him?"
While three CEOs resigned from different banks in recent times, we have not seen a single CEO from the industry come forward to lend support at this time of crisis that seems to have gripped the top job holders in the sector. Alternatively, it could have been a rare opportunity for all the CEOs of the banking industry to get united and collectively speak against the corrupt and motivated board members.
To be fair with the board members, not all fall into the same category. It is sad to see the serving CEOs letting such an opportunity slip for fear of their jobs. But there appears a silver lining in the central bank taking the matter seriously.
Last week, I met one of the veteran bankers who left the CEO job to start his business. Regarding the aforesaid crisis, he mentioned how he saw it coming in the banking industry a long time back and decided to step aside gracefully. Not too many have such guts!
There is no definitive answer to why CEOs in the corporate world don't stand by each other. But probable reasons include how CEOs face intense pressure and scrutiny from stakeholders, such as shareholders, customers, employees, regulators, and the media. Consequently, they can get wary of publicly supporting or defending other CEOs who may be involved in controversies.
Then there is also the fact that CEOs often compete directly or indirectly with each other for more prominent roles in the industry, creating a sense of rivalry and mutual distrust, especially in highly dynamic industries.
Following the violent clashes in Charlottesville of Virginia in 2017, several CEOs resigned from President Trump's economic councils to protest his response to the events. Among them, Kenneth Frazier, CEO of Merck, being the first to announce his departure, faced heavy criticism from Trump on Twitter.
Interestingly, other CEOs, such as Jamie Dimon of JPMorgan Chase, Indra Nooyi of PepsiCo, and Tim Cook of Apple, took to expressing their solidarity with Frazier, praising his courage and integrity. However, in my long career, I have not seen such an example in Bangladesh.
Lessons learnt in childhood such as "Unity is Power" and "A friend in need is a friend indeed" ring high at such times only to fall on deaf ears. Do they strike a chord with the so-called CEO clubs?
Unity gives people strength, courage, and confidence to face challenges and overcome obstacles. With unity a community can stage a war against corruption and a country can achieve freedom from foreign powers.
Above all, unity promotes stability and security, with everyone standing tall and having each other's back.
The author is founder and managing director of BuildCon Consultancies Ltd