University head calls for business integrity

BUSINESS leaders must ensure the highest levels of integrity are maintained so that benefits of capitalism are enjoyed by all, a top academic said yesterday.

Speaking at the conferring of degrees and diplomas to over 500 graduates in the College of Business, University of Limerick President Dr Roger Downer said that in the wake of corporate scandals in the US, business leaders are now looking for integrity, ethics and values in new business recruits.

"It is an interesting time to be entering business because public confidence in the corporate world is probably at an all-time low. In recent months there has been a wave of corporate scandals, with such companies as Enron, WorldCom, Xerox and Tyco accused of major financial wrongdoing and some senior executives charged with excessive personal greed.

"The CEO of Tyco had an annual personal expense account of $100m; I don't know how you would spend $100 million a year, even with the $2m party that he gave his wife on her birthday. Tragically, it seems he was not alone.''

He said in 1981 the top CEOs of major US companies earned 25 times the average hourly pay of their workers: in 1999 that figure was 419 times.

The executives and directors of the 25 largest firms to go bankrupt in the US last year received $3.3 billion in compensation in the two years prior to the declaration of bankruptcy, he said.

"Unfortunately, the employees of these companies were not so fortunate 100,000 of them lost $5 trillion of paper wealth as a result of the bear market caused by these excesses."

Dr Downer said the situation with Irish business was not as extreme as the US but we should not be complacent. "There are excesses in Irish business and there is still an unacceptable gap between the rich and poor,'' said Dr Downer.

He believed the new business graduates could do something about it.

"Indeed, the change is already starting,'' he said. "When I talk to corporate leaders now about the qualities that they look for in recruits, they mention values, integrity and ethics.

"They talk about corporate citizenship, about responsibility for the communities in which they are located and a need to demonstrate concern for the less advantaged members of our global society."

He said the challenge for new recruits as members of the business world and as aspiring corporate leaders was "to ensure the highest levels of integrity are maintained and that, as a result, the benefits of capitalism are enjoyed by all and not just a few fat cats".

Professor Noel Whelan, Vice-President and Dean of the College of Business, in congratulating the 597 graduates on their achievements, hoped they emerge with the ethical values of fairness, honesty, decency and a sense of service and contribution to society and the community which will serve them well in the time ahead.

"Recent events in the world of global business make these values more necessary than ever," he said.

Eamon Dillon, Nenagh, Co Tipperary, was presented with the Silver Medal for first place in the College of Business 2002.