Michael Zychinski, Chief Ethics & Compliance Officer, Deloitte LLP
Various speeches, 2009-2015
After I found the story of the Boston flood for him (the first excerpt below), Mike always wanted to open his speeches with historical trivia from wherever he was speaking. Of course, I tied whatever story I found firmly to his message. Fortunately—or perhaps unfortunately—people do shady and unethical things everywhere. It was a challenge for me to narrow these selections down to my favorite four stories.
Managing Ethics in Organizations, Bentley University, Waltham MA, 2009
I know this is a fine program you’re participating in, but I have to tell you that I chuckled a little when I saw the title of the program: “Managing Ethics in Organizations.” The word “managing” implies planning and control. And while that certainly is the ideal to which we all aspire, in my experience—and I don’t think I’m alone here—an Ethics Officer’s best-laid plans can be derailed at a moment’s notice.
Let me illustrate that point by offering you a bit of local history. It happened in the early years of the 20th century—and although companies didn’t have Ethics & Compliance officers back then, I think you’ll notice some parallels to the kinds of work we do today.
In January 1919, the North End of Boston was hit by a devastating flood. More than 20 people died and hundreds were injured. The flood caused several buildings to collapse and knocked an elevated train right off its tracks.
You might be thinking, “That’s tragic. But it sounds like standard flood damage.” And you’re right. But this wasn’t a standard flood. It was a flood of molasses.
Now, usually we think of molasses as a slow-moving substance. But when a 2.3 million-gallon holding tank burst that day, it sent the sticky syrup cascading through the city streets at 35 miles an hour. In a wave that some reports said was up to 40 feet high.
Who could imagine that such a thing would happen? It had never happened before (and, thank goodness, it’s never happened since). But it happened once, and that was costly enough.
Could this tragedy have been prevented? The exact cause of the failure was never determined, but it may be that shoddy construction was to blame—the tank apparently leaked from the outset, a fact the company attempted to hide by painting it brown.
It seems to me that the Great Molasses Flood of 1919 is the perfect analogy for our jobs today. Whatever company we work for, whatever industry or profession we work in, we Ethics & Compliance Officers are charged with finding out if there are any leaky tanks in our organizations and fixing them before they cause serious damage.
We have to recognize that the majority of organizations will take care to build strong, well-functioning tanks in the first place. But there will always be some that choose to paint a leaky tank brown to hide its problems….
Deloitte Internal Event, Boca Raton, FL 2009
I hope you’ve been enjoying your time here in Boca Raton. It certainly is a beautiful place. Golf, tennis, sun—everything you could want is here. There’s even a cautionary tale suitable for your Chief Ethics & Compliance Officer to kick off his presentation with.
Back in the mid-1920s—years before the stock market crash—this beautiful resort we’ve been enjoying was at the center of a huge business failure. Unscrupulous developers had spent much of the early 1920s selling land in sunny Florida to unsophisticated—and unsuspecting—investors. Middle-class folks from up north often arrived down here to find that the land they thought they had purchased didn’t actually exist. Or if it did exist, it was in the middle of a mosquito-infested swamp. Obviously, this did not please them. And eventually their displeasure got loud enough and insistent enough that it generated a lot of bad publicity.
Of course, the wealthy folks who bought land in Boca Raton didn’t have to worry about that. Not only was the land they purchased real, but it was also in an incredibly desirable area. Architect Addison Mizner, who created the pink palace that is now the Boca Raton Club and many of the other period buildings you see around town, had plans to develop a paradise of mansions by the sea. Mizner wanted Boca Raton to become “the Venice of the Atlantic.”
The sad thing is, if he had begun his work a few years earlier, he might just have succeeded. But Mizner started developing Boca Raton just as the real estate boom turned to bust. The bad business practices of other developers in other areas of the state soured the market for all Florida real estate. And when a hurricane hit the coast, that was the last straw. Mizner’s clients and colleagues fled, taking their funding with them. And Addison Mizner—who was guilty of nothing but bad timing —was forced into bankruptcy. He died in disgrace a few years later.
So that’s your history lesson for today: Even people who have who have nothing but the best intentions can be brought down by the misrepresentations or outright misdeeds of others.
Continuing Professional Education course, Kansas City, MO 2014
Welcome to Kansas City!
This city has been home to many notable people. The legendary saxophone player Charlie “Bird” Parker lived here. And the bandleader Count Basie was discovered here. Walt Disney went to school at the Kansas City Art Institute and opened his first animation studio here. One of the frequent visitors to the studio was a local rodent that Disney fed – so you might say Mickey Mouse comes from here too.
But one notable resident whose name you might not recognize is William S. Gregory.
Back in the mid-19th Century, William Gregory and his wife Elizabeth moved here from Kentucky and opened a grocery store. Gregory was one of the settlers who petitioned to have the area incorporated as an official city. And in 1853, it was. Cities need mayors, and the populace elected William Gregory as their first.
Ten months later, Mayor Gregory had to resign. Not because of any wrongdoing or impropriety. He had to resign because someone noticed that the farm he lived on was outside the city limits.
You might think that if you were campaigning to create a city, you’d pay attention to where the city’s borders were going to be. But apparently Mayor Gregory didn’t. So that’s one good lesson for us from Kansas City: Know your boundaries and stay inside them.
Continuing Professional Education course, Busch Stadium, St. Louis MO, 2015
Welcome to one of my favorite places in the world. I grew up here—in St. Louis, I mean. But I guess you could also say I grew up at Busch Stadium. I have spent many happy hours here watching the Cardinals play.
You may not realize this, but the St. Louis Cardinals are one of the oldest teams in baseball. They were founded in 1882—just two years after Deloitte opened its first office in the U.S. Back then, the team was called the Brown Stockings. But just before the turn of the century, someone added a red stripe to the uniforms. People starting commenting on the “cardinal red” color and the name stuck. The next year, the team formally changed its name to the Cardinals.
That’s one example of how an action can have unintended consequences. A simple accent on the uniform became an enduring brand. In that case, things turned out very well. But as anyone working in Ethics and Compliance can tell you, unintended consequences don’t always have such positive results.