Local customs & corporate governance
A multinational company operating in emerging markets discovered an individual who had access to the company float was taking money out of the company but replacing it before the new accounting cycle. With strong corporate governance rules, immediate dismissal seemed to be the natural decision. However, a board member knew this was out of character and not the norm of one of their best and longest-standing employees. They asked us to look into it.
Insight & outcome
Understanding local customs was the key to resolution.
Traditionally, the village elders were responsible for community members, helping where and when needed. Time and technology may have moved on, but customs and traditions tend to remain. The company had built a great deal of trust in the region and community. But no one realised that the company’s reputation made this individual a modern-day ‘elder’. Hence, when asked for help, it was his duty to do so. In effect, the company’s success brought unintended consequences and potentially nasty repercussions for local hires.
So how could the company navigate its commitment to building local economies while ensuring adherence to strict governance practices?
- Investigated if anyone else was being asked to assist community members and themes.
- Used this insight to create a fund with guidelines on how it was to be used.
- The product development team got involved and developed a lucrative yet fair multi-million-dollar product that also solved a problem for the unbanked
- Adjusted how the company found and integrated local talent.
Why it matters
True diversity and inclusion is about recognising, understanding and incorporating the uniqueness of local customs, traditions and circumstances of people from all walks of life. Get it right, and you could become a more profitable and sustainable company in the process.
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