If you are not prepared to quit over corporate governance policies, maybe it’s time to help your company develop some that you would be prepared to quit over.
The Washington Post and several other news outlets reported on Tuesday that Carla Smits-Nusteling, the chief financial officer of Royal KPN, the Netherlands’ largest telecommunications provider, has announced that she will leave her post in April because of disagreements over the company’s governance structure.
According to reports, the company publicly acknowledged that Nusteling had ‘come to the conclusion she did not agree with the internal governance of the company,’ although no details on what specifically was in dispute were given.
However, the fact that KPN is coming under investigation for possible collusion with T-Mobile and Vodafone for hiking prices for internet access might provide some insight into why Nusteling is making a break with the company now. It looks as if she might be putting it on the record that she disagrees with what’s happening at KPN before she is called to give statements for future investigations.
She could have left ‘to pursue other opportunities’ or ‘for personal reasons’, as so many others have done when resigning from their jobs; instead, she has sounded an alarm about the company’s governance. Now, almost certainly, there will be a review of the company’s governance policies by regulators.
Whether KPN is actually found to have done anything wrong or not, this is an outstanding example of one person’s commitment to governance. Any time the person in charge of a corporation’s fiscal health leaves the company announcing disagreement with management, it raises red flags to regulators and investors. Nusteling quitting has become an act of governance in itself because it has brought attention to a potential problem. Good for her. Good for governance.
While we all don’t hold high-level positions such as CFO that would raise red flags if we were to quit, the start of the year is a good time to reassess our commitment to our corporate governance policies. You really ought to realistically determine what you are willing to do to ensure that governance policies are carried out in a way that enhances shareholder value and protects the company from fraud and other internal wrongdoing. Â
If you are not prepared to quit over corporate governance policies, maybe it’s time to help your company develop some that you would be prepared to quit over. When all employees show the commitment to governance that Nusteling showed this week, shareholders will rest easier and corruption will surely find itself on the run.
