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This article first appeared in La Segunda on January 28. 2015.

“These cases will have repercussions for the new generations”, is the reflection of Susana Sierra, co-head and professor of the diploma course in Compliance and Good Corporate Practices UC, on the latest financial scandals.

Cases such as Penta, Juan Bilbao’s transactions, or the chicken market have called into question the reputation of a business sector, questioning the work of various organizations and financial entities.

Sierra appreciates that these types of cases come to light. He believes that the rest of the business community and especially company directors are becoming more aware of these issues and, incidentally, have had an important impact on business school students.

“These cases will have an impact on the new generations. In terms of entrepreneurship, I have seen how these issues are beginning to take on greater importance. It has been established among people who are entering the labor market, among students, that here you can no longer do whatever you want,” he says.

-In the universities, is there a new generation of entrepreneurs and businessmen?

-In any case, it is very noticeable. I have been teaching entrepreneurship to fifth-year commercial engineers since 2009, and I have seen the change from 2009 until now. There is a much greater social awareness among students, they are much more concerned about generating a social impact -creating shared value, generating positive issues with those with whom they interact- and not only an economic impact.

So this same vision leads these future entrepreneurs to seek to be responsible with the people who work in the company, with customers, with society.

-What about corporate governance?

-There you can see that there is a strong chance. With the La Polar case, there was a before and an after: before there was an aspiration to be present on many boards, but now the directors themselves are careful because if they are in too many companies they can’t perform well. They don’t have time to deal with all the issues.

-What do you think are the keys to maintaining a good corporate reputation?

-You have to be super conscious or act within what is right and what is wrong and go beyond that, regardless of whether there is a law or not; you have to be conscious and always act on something that you are not ashamed to reveal later. Abroad, I saw a businessman from a construction company complaining because, in his opinion, they were being filled with laws and regulations as part of a conspiracy from Europe to increase costs in labor safety issues.

It doesn’t matter if there are work safety standards; if you have an employee who is under your charge you have to worry about their safety, give them helmets, harnesses, because you are responsible for these people. That is the most important thing that a businessman has to think about today: they are not only responsible for their families, but also for their workers, their suppliers, and all the stakeholders that have a relationship with them.

“Organizations have to be aware of the risks.”
-How do you think it should be dealt with at the organizational level when a certain member of the company incurs these bad practices?

-Before it happens, organizations have to be aware of the risks that may arise when they incur bad practices and have controls so that this does not happen, but that goes beyond a written policy or an internal regulation. There must be training and dissemination within the organization. And after a bad practice has occurred, the best and cleanest thing to do is to face it, analyze what happened, if indeed there was no control, no procedure. If it did not exist, it will be the company’s fault, and if it did exist, it will be the fault of the person who did not comply with it.

It is necessary to know how to differentiate this type of conduct, because it may be that the company had everything in order, but then a person committed an illegal act.

-How can a company that falls into this type of situation recover from this situation?

– Mainly by cleaning up the company and establishing good practices. Some companies have had crises due to bad practices and have been able to get back on their feet. Siemens worldwide had serious cases of corruption and was able to get up, today they are an example in compliance. In Chile there is also the case of Ceresita, which was accused of bribery by the law of criminal liability of legal persons; they also restructured, reached an agreement with the Prosecutor’s Office, showed their faces, and have recovered their image.

Interview with Susana Sierra