By Joaquín Mirkin
Investing in ethics and integrity is, without a doubt, the best deal for leaders and organizations. In defense of this hypothesis are the benefits of internal governance of organizations, and for the social environment where companies cooperate. As well as greater long-term profitability as a result of good reputation, there are moral considerations of responsibility towards one another for the common good. However, less attention is usually given to current geopolitical affairs, which is essential to understand why transparency, integrity and the fight against corruption pose such a central competitive advantage.
First and foremost, the struggle between the United States and People’s Republic of China is the new axis of geopolitics. Unlike what happened during much of the Cold War,where Washington carried out a strategy of "containment" of the Soviet Union (with little or no economic link between them), today the United States and the People's Republic of China are interdependent in the greater integration of capitalism through digitization and the Revolution 4.0
There is a current of analysts who see a withdrawal of Washington from the world. This is far from reality; the withdrawal in Afganistán and the expansion of the pact with the United Kingdom and Australia (Auskus) in the Indo-Pacific region, indicate a readjustment to compete with the extraordinary growth of Beijing. The strategy plays out between a combination of deepening economic coexistence and a competition for political power, influence, and technology.
Second, this dynamic is playing out across the globe, including the Western Hemisphere. What does it mean for Spain and Latin America? That Washington, in its competition with Beijing, is working to raise transparency standards and place the fight against corruption as a central issue for the development of the region, also helping its companies to compete on the ground. US standards are very strict in terms of due compliance and penalize corrupt practices of its companies and citizens abroad (Foreign Corrupt Practices Act).
At the same time, Washington is increasing its attention and efforts in Latin America in the face of Chinese expansion in strategic sectors. This translates into greater pressure on the functioning of the market, seeking independent judiciary powers, State security forces away from corrupt structures, and through direct support for the fight against drug trafficking and organized crime.
A serious warning to all are the reputation and business damage stemming from cases like Odebrecht SA (a company that filed for bankruptcy after years of paying multi-million dollar fines following the mega-scandal), the Panama Papers and the most recent revelation of Pandora about mega evasions in tax havens.
Those who do not understand that they must put their things in order, with transparency, will not survive the onslaught that is coming. The lack of integrity, corruption ,or remaining passive in the face of the demands of a mobilized society are bad business for companies and corporations.
Ethics, being ethical, in practice –beyond poses and speeches– is essential. The new business leadership must be proactive and prevent. This requires thinking about compliance not only from a legal point of view, which is of course essential, but from an integral point of view of reputation, relationships with stakeholders and from the promotion and professional exercise of ethical public affairs .
Promises and Reality
The great current battle is symbolic in the face of an increasingly demanding public opinion . At the communication level, the challenge is to propose to organizations, companies, and government teams to Walk the Talk, that is, to go through what has been proclaimed.
Today it is imperative to shorten the existing dispersion gap between what has been understood and conceptualized as urgent and important and what is not yet being carried out. In this gap, public opinion has become an evaluator of the performance of all those who wish to become social actors. Punish with cancellation or reward with the award of legitimacy. The excuses, the “here it is always done this way”, are no more. The management is daily and demands a high dose of responsibility and increasingly committed advisers, supporting the work teams to settle the daily ethical performance.
Many companies have understood the importance of ethics –and have sophisticated their internal Compliance and Governance areas– although the problems and demands change every day.
Given this context, Spain could recover its political influence and increase investments in Latin America, transforming itself into a bridge between Brussels and the region through the promotion and encouragement of corporate transparency. The European Union is, in short, a normative power and leads the green transformation, axes on which Spain has space to amplify its voice and its work in Latin America with a powerful message: investing in ethics and integrity is, in short, the best development business.
This article was originally published on the blog of the consulting firm Torres y Carrera, Communication Consultants, on November 18, 2021 here.
English 
Español