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Bank of America is Not the Only Company that Should Fear Wikileaks

Bank of America is right to fear Wikileaks. Any company that loses 3% of its stock value on a rumor is in a pretty vulnerable place. I have no particular insight or knowledge to challenge or support the rumors that Wikileaks' next target is this bank, and rumors are hardly a new phenomenon. But what interests me--and should concern every company--is the fatal corporate flaw that makes Wikileaks so powerful. Most companies worldwide have skeletons in their closets that they hope no one will ever see - including themselves. That they'd prefer to look away is institutionalized willful blindness, and it's reaching epidemic proportions.

A Bad Habit in Corporations
Willful blindness started life as a legal concept; it holds that when there are things you could know and should know, but manage not to know, you're still responsible. The idea was central to the conviction of Jeff Skilling and Ken Lay in the Enron trial. But it's more than just a legal idea: it's the bad habit that lies at the heart of far too many businesses.

Researching my book on the subject, I've studied willful blindness around the world, in companies large and small in every sector. And I'd argue that the biggest problem we face, in business and in government, isn't the stuff we don't know about - but the stuff we do know about but turn away from. Until, often out of sheer despair and frustration, someone leaks.

Organization Silence: A Big Red Flag

Institutional blindness has lots of danger signs. Chief among them is organizational silence, a term coined by two American academics, Elizabeth Morrison and Frances Milliken at NYU's Stern Business School. When they interviewed a cross-section of executives, they found that fully 85% of them had, at some point, felt unable to talk to their boss about something in the business that bugged them. In other words, something was wrong but they couldn't discuss it. I repeated the study in the UK - and got a similar result. The consequence of all that silence is simple: something is wrong, lots of people know, but nobody's doing anything.

Another danger sign is unanimity. If there's a key initiative around which there is no real debate, the chances are you're turning a blind eye to something no one wants the political pain of handling.

Don't Shoot the Messenger
Eliminating willful blindness isn't simple because it is a part of human nature. If you preferred not to look at this month's credit card bill, or you didn't get around to scheduling that mammogram, you'll know what I mean. Because it is so fundamental to all of us, it poses a serious endemic risk that only determined and brave leaders ever overcome. They start with the knowledge that they don't know what's really going on - and put in place aggressive strategies to improve their peripheral vision. It isn't easy and the challenge never goes away for anyone.

Everyone now will decry Julian Assange and Wikileaks; it is, after all, easier to shoot the messenger. And there are, admittedly, serious ethical issues around what and how to publish. But even if you eliminated Wikileaks tomorrow (as plenty of people would like to) the problem won't go away. Neither Assange nor his site and its inevitable clones would have anything to do if leaders made themselves willfully sighted. if you have skeletons in your corporate closets, the safest thing is to take them out and look at them yourself.

Before someone else does.

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