Why so many powerful people think rules are for someone else; People in positions of power tend to think they are entitled to break society’s rules

Fiona Smith Columnist

Why so many powerful people think rules are for someone else

People in positions of power tend to think they are entitled to break society’s rules.

Published 07 October 2013 11:58, Updated 08 October 2013 07:12

The airwaves and social media are throbbing with outrage about politicians claiming allowances for private trips and businesses using bribes to win valuable work. This is the kind of behaviour that most people know they would never get away with – even if they wanted to. What makes it worse, in the mind of the average person, is that the people being exposed are already so privileged and powerful. Tony Abbott can easily afford to fly to Wangaratta for the wedding of a colleague, why would he charge the taxpayer $1094.64 for the trip? Sydney Morning Herald columnist Peter Fitzsimons made a good point over the weekend, when writing about Attorney-General George Brandis charging the taxpayers for the cost of a trip to a radio host’s wedding.Brandis had justified his actions with the comment that, with the wedding guest list dominated by media people, most of the time was spent “talking about politics”.

Retorts Fitzsimons: “Exactly. And surely the guiding light on such matters is whether or not you’re talking policy, not merely politics. Politicians pay for the politics, and we pay for the policy development, would [that] seem to be fair?”

It is notable that the Labor opposition has not exactly been shouting from the rooftops about these “wedding cashers”, leading to the suspicion that this sort of practice has probably been commonplace in Canberra.

But all this is small change compared to the allegations that Leighton Holdings had paid multi-million dollar kickbacks to win work – and claims that the then CEO, Wal King, had approved it.

And then there are the ongoing investigations into the business activities of the former NSW Labor ministers Eddie Obeid and Ian Macdonald, as well as questions about why the new NSW Opposition Leader, John Robertson, did not report the offer of a $3 million bribe by businessman Michael McGurk, who was murdered in 2009.

Of course, these are just the cases that are in the media today and many of them may not account to actual illegality or corruption – no such findings have been made in the travel claims allegations or against Leighton Holdings, Wal King or John Robertson.

But the frequency with which such allegations are made about our leaders makes you wonder about what goes on that we never find out about.

The big question is: why do they do it? What makes successful people more likely to bend, break and flout the rules. It is not like they don’t know what the rules are – they generally make them.

Hypocritical tendency

To investigate whether power corrupts, or if power merely attracts the corruptible, Joris Lammers at Tilburg University, in the Netherlands, and Adam Galinsky at Northwestern University, in Illinois devised an experimentthat suggests that power promotes a hypocritical tendency to hold other people to a higher standard than oneself.

According to a report in The Economist: “These results, then, suggest that the powerful do indeed behave hypocritically, condemning the transgressions of others more than they condemn their own.

“But another everyday observation is that powerful people who have been caught out often show little sign of contrition. It is not just that they abuse the system; they also seem to feel entitled to abuse it.”

“People with power that they think is justified break rules not only because they can get away with it, but also because they feel at some intuitive level that they are entitled to take what they want. This sense of entitlement is crucial to understanding why people misbehave in high office.”

Another interesting finding from another study is that people tend to think that rule-breakers are powerful.

A study in the Social Psychological and Personality Science journal says when people have power, they act the part.

“Powerful people smile less, interrupt others, and speak in a louder voice. When people do not respect the basic rules of social behaviour, they lead others to believe that they have power . . . ”

“Norm violators are perceived as having the capacity to act as they please”.

In this way, we law-abiding people play our part by unconsciously colluding with the rule-breakers, admiring them for their chutzpah and not taking them to task when we should.

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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