The Magazine of Corporate Responsibility

Penn State Scandal Highlights Failures in Leadership and Culture

by Gael O'Brien

The crisis at Pennsylvania State University was preventable, as was made clear by former FBI director Louis Freeh  in his 267 page report  released today.

Freeh was retained by Penn State trustees in November 2011 as special investigative counsel after the child sexual abuse scandal involving former assistant coach Jerry Sandusky erupted

Problems not addressed appropriately escalate, often into tragedies that create unsuspecting victims, like at Penn State. Whether it is child sexual abuse, sexual harassment, fraud or some other crime, one of the great enablers or deterrents to crisis is the culture of an organization. A crisis is born because small and large indications of problems aren’t recognized, addressed or confronted until the problem explodes.

It happened at Penn State. The unpleasant truth is it can happen anywhere a culture doesn’t resist.

The formula for recovering from a crisis is to take responsibility, fix what is broken, replace people, rebuild trust, and restore reputation. Often organizations are stronger as a result of going through the fixing and rebuilding because through the process, they rediscover who they are, what they stand for, and the values they want to embrace. In the process, they change the culture to reflect the lessons learned, the excellence they want to be known for, the leadership they want to have, and the community they want to be.

How much easier on the pocketbook, psyche, and reputation monitors if the importance of investing in, reinforcing, and monitoring culture was a regular part of running a university or a company.

It is no surprise that Freeh’s report spends time on Penn State’s culture. While the report’s focus is on protecting children, preventing incidents of sexual abuse of children on campus or in university-sponsored programs, and ensuring problems are addressed, the recommendations have a broader application that can help Penn State close the gap from where it is to where it wants to be. The recommendations are an inventory any organization could review to address where potential vulnerabilities might be.

The more than 100 recommendations address:

  • governance
  • administration and general counsel structure, policies and procedures
  • university culture stressing values and ethics-based decision making
  • compliance structure, risk and reporting misconduct
  • athletic department integration and compliance
  • management of university programs involving children, and
  • monitoring change and improvement

“There is an over-emphasis on ‘The Penn State Way’ as an approach to decision-making,” said the report; it continued, “a resistance to seeking outside perspectives, and an excessive focus on athletics that can, if not recognized, negatively impact the University’s reputation as a progressive institution.”

The report's culture section brings values more directly to bear on how Penn State operates. Recommendations include appointing an ethics officer to serve as counsel to the president and board on ethics issues and alignment with Penn State Principles; establishing an Ethics Counsel; appointing a chief compliance officer with whom ethics initiatives are coordinated; emphasizing and practicing transparency at all levels: and communicating openly and often with the university community around university issues and policies. Also recommended is that PennState’s Rock Ethics Institute,  the Ethics Officer and Ethics Council develop leadership and ethics training modules for all areas of the university.

An issue affecting most universities with a winning football team is how to integrate athletics into the rest of the university culture. The report recommends Penn State ensure sustained integration of the Intercollegiate Athletic program into the broader university community by involving many university representatives, including the Special Faculty Committee on University Governance, the university’s Coalition on Intercollegiate Athletics, Rock Ethics Institute, students, faculty, alumni, staff and representatives from peer institutions with “experience in reviewing and improving institutional culture in academic settings.”

The report is a great deal to digest, a blue print of many steps. Trustees’ held a press conference today only a few hours after the report was released. They indicated they accept full responsibility for the failures that occurred, are closely studying the report recommendations, have increased already their oversight responsibilities, and will be addressing particularly the governance recommendations so that, according to board chair Karen Peetz, they can be “best in class in board governance.” The trustee meeting tomorrow will be streamed live on the Internet , an indication of increased transparency.

The legacy of leadership at Penn State is ripe for reinvention. “The most powerful men at Penn State failed to take any steps for 14 years to protect the children who Sandusky victimized,” said Freeh .

Joe Paterno (Hall of Fame football coach), Graham Spanier,  (president); Tim Curley (athletic director) and Gary Schultz  (vice president) never demonstrated concern for the safety or welfare of minors, said Freeh. Paterno died in January 2012, Spanier has taken a new job and Curley and Schultz are awaiting trial  on charges of perjury and failure to report suspected child sex abuse.

As for Sandusky, he was found guilty of 45 of 48 counts of child sex abuse in his trial ending June 22, 2012.

Penn State acknowledges it has much to do. How will current leaders internalize and demonstrate that the work ahead is particularly about culture, how to create an environment where students, faculty, administrators and board members understand how to give voice to the values that will definePennState’s ongoing success. Where better than a learning environment can the most important lessons of all occur.

Photo: by Jim, the Photographer, via Flickr.

Gael O'Brien is a Business Ethics Magazine columnist. Gael is a consultant, executive coach, and presenter focused on building leadership, trust, and reputation. She publishes the The Week in Ethics.

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