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.

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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.

Ferris, Writing the Declaration of Independence, 1776 (Courtesy The Library of Congress)

King George III lost America because of hubris and a failure to be guided by reality and the discipline of sound governance. The same failures plague America’s efforts in Iraq.

Washington, DC

The doors and drawers of Congress are opening and closing briskly as the Democrats prepare to take power from the Republicans in January. On the other side of the world, Iraq’s government moves closer to collapse. It is anyone’s guess which will occur first. In the same length of time as America has been in Iraq, it helped to liberate Europe from Nazi clutches and secure freedom for millions. In Iraq, its involvement has unseated a tyrant but in the process thrown that nation into the jaws of anarchy and civil war.

The mood here in Washington is one of anticipation and unease. I felt a similar atmosphere here at the height of the war in Vietnam and again during Richard Nixon’s impeachment hearings. To that list of historical turning points for the United States, Iraq will now be added. Events are clearly in the saddle, as Emerson said, and where they will ultimately gallop and into which dark cloud America and the world might be pulled is something few can foresee. An ominous and not so distant shadow is already forming over an entire region involving Iraq, Iran and Lebanon —and not to forget the ongoing threats posed by a nuclear North Korea— leaving the Administration helmsmen who placed America on its current catastrophic path scrambling in confusion and disarray to find a new direction. Few have confidence in their ability, as the results of the mid-term elections confirm.

Well-intentioned individuals can make terrible mistakes, of course. And those with hidden motives can sometimes be heralded as heroes. But this time, America’s misfortune is also about governance. For while individuals performed the lead in this tragedy, the failures of mindful governance practices played a supporting role.

Was it, for instance, a dysfunctionally politicized and split U.S. Supreme Court, which insisted the voting count stop and made possible George W. Bush’s entry to office without the popular vote, that set the stage for the missteps and misadventures that followed?

Was the Congress, which the founders intended to serve as a check on the exercise of executive power, too quick to grant, and too slow to question, the de facto writ of war that launched America’s disastrous foray in Iraq?

In the boardrooms of America and in its legislative chambers, it is the same reluctance to ask discerning questions, the same unwillingness to hold executive power adequately to account, the same failure to recall and learn the lessons of history and the same misplaced belief that success in the past guarantees triumph in the future, that has caused the greatest calamities for both institutions of capitalism and democracy. These are the governance failures that undid Enron, WorldCom, Hollinger and countless other companies before and after these recent scandals. They are the governance failures that contributed to Vietnam, Watergate and now Iraq. They are also, in part, the consequences of leaders who set their course to the wrong personal compass, whether in the form of excessive pay that causes them to cut corners and play with the numbers, as in the current wave of stock option backdating (it is, among other matters, the current and entirely predictable effort on the part of American business and its Administration supporters to roll back the gains of Sarbanes-Oxley that has brought me here and about which I will be commenting in the near future), or in the form of ill-conceived slogans such as “you’re either with us or with the terrorists” and the “axis of evil”. Neither of Mr. Bush’s catchphrases advanced anything positive, but there are plenty of indications that they alienated needed allies and emboldened known foes.

Few cries of outrage followed the early destruction of Baghdad in the campaign that boasted shock and awe and lived up to its billing. It was only a modest preview of the destruction to come, however. Not enough questioned the Administration’s scenarios which resembled more a Hollywood movie than a plan of war: an early defeat of Saddham and a fast occupation of the country, followed by a quick flowering of democracy and end credits. No one really explained the costs of the war to the American people or what they would be giving up at home in health care, education and policing. It is by no means clear that there was a general understanding that American men and women would actually have to die –certainly not on the scale that has been experienced. The descent of the American image into the dark recesses of torture and warrantless detention, the abuse of a justice system for some without windows where no sunlight of fairness or accountability was permitted to enter, and the ascendance of a more prying and meddlesome government which subjects to inspection even the reading habits of children and the shoes of elderly nuns, leaves the heart empty where the majesty of America’s commitment to decency, justice and liberty once stood. It needs to be regained.

Knowing the colossal failures of intelligence to detect or prevent the terrorist attacks on 9-11 –failures which the 9-11 Commission also attributed in part to inadequate Congressional oversight– it remains bewildering how the Administration, Congress and the American people could not have considered the possibility that a similar failure might unleash a series of events from which neither Iraq nor America might easily recover. An informed and intelligent approach by government to its duties and an informed and intelligent public understanding of the cost and consequences of that policy are always necessary in a democracy. There is, in the folly of Iraq and the discussions leading to it, a stunning absence of both the informed and the intelligent. There is also evidence in the carnage of this war and the damage it has caused to America at home and to its reputation abroad that lack of judgment, hubris and outright stupidity of the kind which has come to be associated with the Administration’s war efforts can be formidable weapons of mass destruction in themselves.

Finally, it was a failure of governance on a monumental scale for the American people ever to have tolerated the iniquitous idea that to question authority in a time of war, or any time for that matter, is somehow unpatriotic. There was in the aftermath of 9-11 a disturbing inclination on the part of the White House and others to marginalize those who asked certain questions or raised certain doubts about events leading to the war and the foundation of the decisions being made –events and decisions long since discredited even by former Administration officials and supporters –and to tar them with the brush of giving aid and comfort to the enemy. The freedom enjoyed by Americans is also accompanied by the corresponding obligation to hold the mighty to account, to not conform to conventional wisdom without due deliberation, and, even occasionally, to opt out of a lock-step march with the powerful in their self-appointed rendezvous with destiny. These rights and obligations are precisely what America’s youth have so bravely paid for and re-secured generation after generation. Their gift of freedom and citizenship cannot be permitted to be besmirched by those who would use a flag for cheap partisan gain or to cover up a myriad of horrors and miscalculations.

All of these circumstances contributed to the climate that made the disaster in Iraq possible. It was not the first time failures of governance have inalterably changed the political landscape of nations. Britain lost the American colonies because of a kingly lack of vision and miscalculations that could not be checked by principles of sound governance. America, pushed on by presidential ego and the illusion of invincible power that could not be checked by principles of sound governance, is now experiencing the disintegration of Iraq and the loss of its reputation around the world.

Each time I visit Washington and walk past these gleaming buildings, I am struck by the same feelings of inspiration and admiration I had the first time I saw them decades ago. There is a sense that with each magnificent monument a measure of humanity’s highest hopes are laid with its cornerstone, together creating a fortress of governing tenets for civilization’s most noble concepts of freedom, justice and opportunity. History teaches that its greatest ideals must be protected by a bodyguard of governance structures and mechanisms to keep the feet of rulers planted firmly in reality and connected to the consequences of their actions. For it is when America falls short of its more enduring gifts, to itself and the world, of accountable government and high public purpose, that America and the world are truly lessened.

President John F. Kennedy, whose assassination cast a shadow over this town and much of the world 43 years ago this week, knew something of the tendencies of governments and their leaders toward self-delusion. A shrewd student of history, he presented his cabinet with Barbara Tuchman’s The Guns of August, which chronicled the early missteps leading to the carnage of the First World War. For this generation, the march of folly will long be synonymous with the Bush-Cheney descent into Iraq, and leaders who apparently had the benefit of neither John Kennedy’s sense of history nor his foresight.

In a land which so often seeks in its heroic paintings and edifices to remind itself and others of the greatness of its founding virtues, perhaps it would be wise to construct a memorial after each disaster, like Vietnam, Watergate and now Iraq. In that way, citizens and leaders alike could be reminded that greatness is not a sure thing to be taken for granted, that shortsighted and narrow-minded thinking can easily cast a shadow over the most noble principles and that without the countervailing influence of a questioning and occasionally skeptical public, kings and presidents alike, as Jefferson, Washington, Madison and Hamilton knew well, can wield a force that ultimately destroys what they seek to preserve.