In the end, managers are responsible to the institution they manage, the company, not to shareholders, not to employees, not to customers. They are required to protect the integrity of the institution. And I think that’s the rule of management. It is responsible ultimately for protecting the integrity of the institution. And when I mean integrity, I mean it in all senses of the word. Integrity means it’s holding together. Integrity is what lies at the core of the management profession. Now, integrity cannot be maintained unless shareholders are satisfied, because they will withdraw capital. Integrity cannot be maintained until the employees are satisfied, because they’ll withdraw their labour, or customers or other “stakeholders,” which is a word I don’t like.
I would argue that managers are ultimately responsible for protecting and maintaining the integrity of the institution they manage, and that all the other responsibilities and obligations flow from this basic and primary responsibility. Then the directors become the referees that will ensure that the managers are indeed doing their job of protecting the integrity of the corporation.
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