There is no substitute for a culture of integrity in organizations. Compliance alone with the law is not enough. History shows that those who make a practice of skating close to the edge always wind up going over the line. A higher bar of ethics performance is necessary. That bar needs to be set and monitored in the boardroom.  ~J. Richard Finlay writing in The Globe and Mail.

Sound governance is not some abstract ideal or utopian pipe dream. Nor does it occur by accident or through sudden outbreaks of altruism. It happens when leaders lead with integrity, when directors actually direct and when stakeholders demand the highest level of ethics and accountability.  ~ J. Richard Finlay in testimony before the Standing Committee on Banking, Commerce and the Economy, Senate of Canada.

The Finlay Centre for Corporate & Public Governance is the longest continuously cited voice on modern governance standards. Our work over the course of four decades helped to build the new paradigm of ethics and accountability by which many corporations and public institutions are judged today.

The Finlay Centre was founded by J. Richard Finlay, one of the world’s most prescient voices for sound boardroom practices, sanity in CEO pay and the ethical responsibilities of trusted leaders. He coined the term stakeholder capitalism in the 1980s.

We pioneered the attributes of environmental responsibility, social purposefulness and successful governance decades before the arrival of ESG. Today we are trying to rebuild the trust that many dubious ESG practices have shattered. 


We were the first to predict seismic boardroom flashpoints and downfalls and played key roles in regulatory milestones and reforms.

We’re working to advance the agenda of the new boardroom and public institution of today: diversity at the table; ethics that shine through a culture of integrity; the next chapter in stakeholder capitalism; and leadership that stands as an unrelenting champion for all stakeholders.

Our landmark work in creating what we called a culture of integrity and the ethical practices of trusted organizations has been praised, recognized and replicated around the world.


Our rich institutional memory, combined with a record of innovative thinking for tomorrow’s challenges, provide umatached resources to corporate and public sector players.

Trust is the asset that is unseen until it is shattered.  When crisis hits, we know a thing or two about how to rebuild trust— especially in turbulent times.

We’re still one of the world’s most recognized voices on CEO pay and the role of boards as compensation credibility gatekeepers. Somebody has to be.


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The Highs and Lows of Leadership in Business & Government 

 Biggest Winners

Nancy Pelosi, who helped to bring the Democratic majority back to life in the House of Representatives and thereby secure her place as that institution’s first female speaker; Warren Buffett, probably the world’s most respected businessman, for showing that you can win by promising to give it all away; North Korea dictator Kim Jong-il, who thumbed his nose at the U.S. by firing off missiles on July 4th, then testing a nuclear bomb, and is still alive to talk about it; Canada’s Conservative leader, Stephen Harper, whose election brought an end to more than a decade of Liberal rule.

Biggest Losers

George W. Bush; Karl Rove; Saddam Hussein; former HP chair Patricia Dunn; Conrad Black, who wants his Canadian citizenship back after giving it up to become a British Lord (that was before he met U.S. federal prosecutor Patrick J. Fitzgerald, however); Apple CEO Steve Jobs, who, according to a year-end internal probe by Apple’s board, participated in a scheme to manipulate the purchase price of stock options for other participants in the plan; the ordinary people of Iraq, whose daily and increasing dissent into anarchy make them hapless pawns in the greatest American foreign policy disaster of all time.

Most Significant Political Moment

The U.S. mid-term elections, which saw Republican domination of Congress come to a crashing end;

Most Significant Corporate Moment

The sound of prison doors slamming on former icons of corporate America: Bernie Ebbers of WorldCom for 25 years; Jeffrey Skilling of Enron for 24 years; Sanjay Kumar of Computer Associates for 12 years, and numerous lesser figures.


The SEC votes for more detailed disclosure of CEO pay, then later blunts the impact of the move at the urging of business lobbies; Canada’s Finance Minister Jim Flaherty ends the tax holiday for income trusts and puts that country’s corporations back to focusing on their business and not their tax status.

Biggest Political Scandal

America’s prosecution of the war in Iraq, which has lost the confidence of the American people, alienated the country’s allies, cost hundreds of millions of dollars and tens of thousands of lives, and whose damage as the greatest blunder in U.S. foreign policy history may be incalculable. America, in Iraq, has shown itself to be the “pitiful giant” Richard M. Nixon always feared America could become if it did not carefully think through the consequences of its foreign policy decisions.


The wave of improprieties and wrong-doing involving a host of disgraced Republicans, including Tom DeLay and Randy Cunningham, the Abramoff lobbying scandal involving payoffs and bribes, and the House Republican leadership’s turning a blind eye to the disgusting antics of former congressmen Mark Foley.

Biggest Corporate Scandal

The 195 companies, including names like Home Depot, Apple, Restoration Hardware, Staples and Research In Motion, involved in either federal or internal investigations over stock option manipulation –a huge scandal that has already seen the departure of 59 senior executives. And the problem took a stunning year-end turn with the filing of Apple’s internal probe into stock option irregularities, which confirmed that CEO Steve Jobs’ role in the backdating was greater than previously disclosed. A very big job ahead for SEC investigators.


HP, where its own directors brought discredit upon this icon of American technology with a pretexting scandal that intruded into the personal lives of directors and reporters where the board failed to ask the right questions about how the information was being obtained.

Most Admired Board Move

IBM, for taking the lead, albeit belatedly, in ending the insidious policy of issuing stock options to directors. Apple Computer and Research In Motion, take note.

Most Dysfunctional Board

HP –hands down. (But see the Home Despot Award for a close second).

Home Despot Award
For uncommon obliviousness to the growing discontent of shareholders and customers.

Home Depot’s board paid more than $245 million to CEO Bob Nardelli over five years, during which time share value continued to plummet. His heavy-handed domination of the company’s annual general meeting where he routinely cut off shareholders questions after one minute and where not a single member of the board bothered to attend, was an event that would bring a smile to Kim Jong-il. Add to this the low marks the company receives for customer service and recent revelations that it routinely backdated stock option dates for the past 19 years, and the conclusion is that Home Depot and its board are in need of serious renovation. Time to bring in Mike Holmes.

Jack Welsh – Dick Grasso Award for Brazen Excess

The boards of Capital One Financial, Yahoo, Cendant, KB Home and Lehman Brothers Holdings, which paid their CEOs what amounts to over $800 million for the fiscal year 2005. Five CEOs. Eight-tenths of a billion dollars. One hundred percent insanity in the boardrooms that produced this outrage


Hank McKinnell, who, after leaving as Pfizer’s CEO earlier than expected amid shareholder outrage over compensation issues, will receive a retirement package estimated at $180 million; Goldman Sachs, for out-of-this-world bonuses, including a record $53.4 million to CEO Lloyd C. Blankfein; members of Ontario’s legislature, who voted themselves a record 25 percent pay hike just days before going off on a three-month break.

Chutzpah Award

Research In Motion’s application to the Ontario Securities Commission (which was granted) to temporarily lift the trading ban on company insiders so its co-CEOs could exercise 750,000 options at just over a dollar a share at a time when the company had not made statutory filings for it second quarter and its own internal stock options investigation was not completed. Talk about moxie.

E.J. Smith Award for Myopic Vision

President George W. Bush, in a strikingly convincing portrayal of the Titanic’s ill-fated captain, who continued to shout “stay the course” long after America hit Iraq and the devastation was apparent


Members of the self-appointed Capital Markets Regulation Committee, composed of corporate leaders and accounting executives and funded by a former target of New York State Attorney General Eliot Spitzer, which called for a roll back in enforcement against white color crime and higher bars for suing corporate directors and accountants at a time of mounting boardroom scandal over CEO pay and stock option backdating.

Pass the Antidote Award

For all the stories of excess about Conrad Black, his febrile campaign to regain the Canadian citizenship he renounced only a few years ago, and his assertion that he has really become a freedom fighter. Yasser Black? We think not.

The George Costanza “Was that Wrong?” Award

William H. Swanson of Raytheon, who wrote a book containing homespun wisdom that was substantially lifted from one written more than half a century earlier by California engineering professor W.J. King; Tom Parkinson, who, as Canada’s Hydro One’s CEO, put his $45,000 expense tab on his secretary’s credit card to avoid scrutiny and then approved the expenses himself. He’s gone now, too; AT & T, for disclosing without warrant or court order hundreds of thousands of customer telephone records to the U.S. government.

Stupid Utterances Award

“We’re not winning, but we’re not losing.” — The sudden mantra of Bush administration officials to explain why, after spending more than $400 billion on the war and costing hundreds of thousands of lives of coalition forces and Iraqi citizens, the world’s only superpower is in a scientifically neutral position. Absolute zero, Bush style.

“My problem with governance is that it’s really hurting American business.” — Barry Diller, who was paid $265 million in 2005, commenting on corporate governance advocates who question high CEO pay. And you thought it was really Enron and the like that did the damage.

Encore Award

People we would like to hear more from because their voices further understanding of principles of responsibility in governance and leadership:

Harvard professor Lucian Bebchuk, who is doing the most interesting work on CEO pay and stock options in decades; Gretchen Morgenson and Floyd Norris of the New York Times; former White House advisor Richard Clarke; CBS veteran correspondent Bob Schieffer; CBC Washington correspondent Henry Champ, who brings an informed insight to the intersection of Canadian and U.S. politics; corporate governance eminence Robert Monks; former U.N. chief weapons official Hans Blix and U. S. weapons inspector David Kay, two courageous public servants; Generals Zinni, Odom and (Wesley) Clark, who have a commanding sense of vision that has been vindicated by events ; Bono; Belinda Gates, whose mind seems more intricate in its functioning than her husband’s, and she has considerably more style and personality; the (as yet unrevealed) Canadian who can rightfully take Nobel Prize winner Lester Pearson’s place on the world stage to further global peace with the former prime minister’s quiet dignity and professionalism; Zbigniew Brzezinski, perhaps the best foreign policy mind in the United States; Lou Dobbs, who had the courage to see things as they are and speak out; Warren Buffet, who is unique among billionaires; and Michael Beschloss, as graceful a historian as you will ever find.

Enough Already! Award

Belinda Stronach (if you don’t know who we mean you are lucky); lobby groups for corporate directors; David (“Axis of Evil”) Frum, in either his U.S. or Canadian persona; Newt Gingrich, because it really takes a special talent to blow it like he did when he was House Speaker; Jack Welsh. Especially, Jack Welsh; the Business Roundtable’s long since discredited positions on CEO pay and corporate governance; demands for the roll back of Sarbanes-Oxley; CNBC’s James Cramer is on the border line; the dynasty approach to the American presidency, which leads to great tedium and sclerosis of the political arteries due to a lack of fresh thinking. America can do better than alternating its leadership between the Clintons and the Bushes and might just be better off seeing less of both families.

Outrage of the Year: The Two Americas

The war in Iraq continues, demanding the ultimate sacrifice of courageous men and women in the U.S. military and causing unimaginable pain and suffering among the Iraqi people, while at home it continues to be party time for the rich and the powerful with record high CEO pay, oil company bosses pulling in a king’s ransom from astronomical gas prices courtesy of Middle East tyrants and despots, and tax breaks for the wealthy that enable that group to spend like drunken sailors on luxuries. It is a time in which neither the pain nor sacrifice of the war is being shared fairly, nor, for that matter, is the great leap in wealth being enjoyed by a select few.