INTEGRITY THEMES

Suggestions for a good conversation about integrity

DIFFERENT STAKEHOLDERS AND THEIR INTERESTS MAY CREATE DILEMMAS

All organisations deal with a wide range of stakeholders, sometimes with conflicting interests . Integrity issues and ethical dilemmas may arise in relation to any of these themes when the Management Board has to make difficult choices for which the outside world may call the organisation to account. Supervisory directors would be well advised to discuss in advance with the Management Board those themes that may be decisive in stakeholders’ assessment of whether the organisation is acting with integrity. The supervisory director can also ensure that moral dilemmas are resolved through a careful decision-making process.

It is impossible to identify in advance all possible themes that might be important to the organisation’s integrity. Let alone form a judgement on them in advance. However, supervisory directors can enter into discussions with the Management Board on the basis of a number of relevant themes. These include, for example, themes on which organisations have recently been called to account, on which legal proceedings have been initiated and/or on which interest groups have spoken out. We advise supervisory directors to start a conversation about the following themes:

  1. The impact that the (planned) product or service supplied by the organisation has on stakeholders or on society in general. On the two ends of the spectrum, your product or service can either contribute to a societal goal or undermine it.
  2. The degree to which the organisation and its activities are sustainable. For example, are sustainability requirements taken into account when production processes are being innovated? What measures does the organisation take to reduce its own footprint?
  3. The extent to which the organisation acts as a ‘good employer’. For example, is attention paid to human rights - including in foreign branches - diversity and inclusion, and physical and social safety? Does the organisation sufficiently fulfil its duty of care towards employees in relation to psychosocial stress at work under the Working Conditions Act?
  4. The extent to which the organisation acts as a responsible partner in the value chain. Consider, for example, paying a fair purchase price and complying with regulations on competition, corruption, money laundering and export controls.
  5. Geopolitical developments and the organisation’s position in them. Does the organisation want to take a position on international conflicts? Does the organisation want to distance itself from criticised regimes or countries where human rights are violated? How does the organisation deal with possible polarisation within the organisation?
  6. The responsible application of AI, the broader use of technology, and data protection. If AI is used in certain processes, is there sufficient knowledge about how the algorithm works, including possible bias? Consider, for example, automated processes for screening job applicants. And what does the organisation do to safeguard client/patient data? Are the measures against misuse sufficiently robust, and do subcontractors to whom data is provided also have robust measures in place?
  7. The organisation’s tax ethics. When applying tax structures, does the organisation always operate at the limits of what is permissible, or does it use another method to determine what constitutes an acceptable tax burden? Or, for example, is the organisation established in a particular country solely because of the tax climate?
  8. The organisation’s use of subsidies and budgets and the distribution of the organisation’s profit, including dividend distributions and profit-dependent remuneration. Or, in the case of a charity or public organisation, how is overhead viewed and what is done with possible underspending or overspending?

The aim is not to prescribe the strategy to be followed or the choices to be made. As a supervisory director, you do not occupy a seat in the management board member’s chair. What matters is that supervisory directors have the right conversations with the Management Board about such themes, in order to grasp the attitude of the management board members, the values they pursue and the way stakeholder interests are taken into account when important decisions are made.