Zen and the art of Royal Commissions

Insight

On the eve of the first anniversary of the final report of the Hayne Royal Commission, it is worth examining the response by those executives who felt they had been treated poorly by the process.

In a number of articles in The Australian Financial Review in late January, witnesses who had appeared at the Commission to represent their organisations, their legal representatives and some eminent legal minds lamented the lack of procedural fairness of the Commission. They complained publicly about the inability to defend oneself against allegations and also the huge personal and reputational toll on so many.

A number of those interviewed criticised the nature of the Commission questioning which, they said, was designed to grab media headlines. They further accused the media of sensationalising the theatre of the hearings, with little regard for the meticulously written defence submissions.

However, history tells us the destruction of personal reputations at the hands of a Royal Commission is nothing new.

The 2005 Oil for Food Inquiry comprehensively assassinated the professional characters of many of the witnesses. However, no criminal charges were ever laid and only a handful of minor civil convictions followed. 

This, in part, demonstrates one of the core roles of a Royal Commission and it provides historical guidance on how you need to prepare.

Yes, they are often presided over by a former Judge. And yes, the Counsels assisting are terrifyingly good barristers. But there is a reason the rules of evidence are not as stringent as those of a court of law.

It is because often the very role of a Royal Commission is to expose the gap between what is legally permissible, and what the broader community thinks is morally right. It is a trial by a court of public opinion.

It’s why I’m always slightly bemused when companies and individuals faced with an appearance at a Royal Commission ‘lawyer up’. Preparation focuses on the strongest legal defences and how to avoid adverse findings or potential criminal or civil proceedings at some point long in the future. Messages are generally crafted in an environment of what the law will allow.

But the attack is typically about ethical and moral behaviour, with swift justice. Failure to understand this and respond accordingly can mean your job, career and reputation can be over in weeks, days or even hours.

If you are called as a witness at a Royal Commission, you are probably staring down the barrel of a reputation crisis. So, you need to prepare as such – a legal response, while important, won’t do on its own.

Be truthful and honest, starting with yourself. And do this well before you get near the stand.

Critically assess your business practices and determine if you have credibility gaps. Legal compliance should be viewed as the absolute bare minimum, not the high-water mark for corporate or personal behaviour. This is hard and sometimes requires a fairly brutal assessment of the way people and businesses have conducted themselves.

Words and actions may seem legally balanced. However, they can take on a far more sinister tone when splashed across the front page of newspapers and news bulletins.

Listen to your Corporate Affairs team, or engage a trusted advisor who isn’t afraid to tell you in no uncertain terms the optics of how you’ve done business.

Most of all, align your decision-making and communication around your purpose and values. An organisation whose behaviours are driven by their values invariably make the right calls, however difficult they may be.