Rogue behavior costing $36 billion in legal bills since the financial crisis should give every Board member and Executive sleepless nights. Then add the cost to hire significant compliance and security management and staff to curb rogue behavior, and some serious questions need to be asked!
- What part does pressure to chase profitability encourage a greater level of risk to be taken?
- How much risk is the business willing to take? And at what level does risk become reckless?
- Is the level of inter-staff competitiveness so great that irresponsible risk is encouraged?
- How vigilant are those in leadership to the impact of pressure on employees?
Working in an environment pressurized to succeed at all costs, tends to be the norm, especially in the Financial Sector. Just look at Wells Fargo. Whilst taking risk is a legitimate part of building a successful business and keeping ahead of the competition, when pressure and risk collide it can quickly become a weapon in the wrong hands. Unable to balance risk under pressure to achieve results, the line becomes blurred between acceptable business practices and legal or moral improprieties.
Even more alarming, is when Boards and senior executives fail to acknowledge the environments that promote rogue behavior simply to increase profits. It could be argued that they are as culpable as the rogue employee. Daniel Kahneman, in his book Thinking Fast and Slow, says “we can be blind to the obvious, and we are also blind to our blindness.”
Prosecutions and regulatory enforcement stemming from noncompliance related to employee behavior such as corruption, bribery, rogue trading and insider trading are on the rise around the world. In fiscal 2015, the SEC filed nearly 7% more cases over the prior year, meting out $4.2 billion in sanctions.
People are hired for their talent but little attention is paid to their inherent personality. So when an individual is placed under significant pressure or pushed to take excessive risks, their behavior can turn rogue. The good news? When pressure and risk collide can now be predicted.
Using behavioral insights, management can dynamically match employees with specific environmental conditions to determine their potential response to risk and pressure. They can also discern the degree to which such responses could create rogue behavior and negative actions towards the business.
It is no longer enough to simply look at emails, computer keystrokes, outside influences, sick records etc. – the old hat of international espionage and anti-terrorist tools. What should be clearly understood is that the rogue employee is a human being, that when placed under significant pressure to achieve, will take risks.
The question to Boards and Executives is – do you know your employees?
What corporate entities have in their corner is direct and immediate access to their own personnel from top to bottom and every department – including even outside partners and vendors. So the solution is the deployment of a validated personality discovery process, providing hidden insights and a reliable prediction of where security or compliance risks exist.
Based on external research, employees with the following measurable behavioral traits are more likely to engage in rogue behavior when emotionally triggered
- An inventive mind, full of ground-breaking ideas turns their thoughts to curious and devious thinking when, as an example; many of their ideas are rejected.
- A go-getting, determined person, driven to success at any cost; begins to cut corners, as a toxic competitive streak takes over.
- A reticent, uncommunicative, taciturn minded person normally just seen as the quiet one’ begins to hold onto key information that others need, simply because they have taken offense over something trivial.
DNA Behavior International’s validated system gets below the surface to reveal behaviors that, if not managed, can lead to ruinous behavior.
The Unique DNA Behavior Approach is able to Score, Filter, and Prioritize Employee Personality Insights.