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Mind of Jacka: Hypocrisy and Internal Audit

Blogs Mike Jacka, CIA, CPA, CPCU, CLU Sep 25, 2020

Let's make up for that right now. And, as good internal auditors, we always need criteria, correct? So, let's start with a definition. This one comes from Meriam-Webster. "Hypocrisy: A feigning to be what one is not or to believe what one does not: behavior that contradicts what one claims to believe or feel."

In other words, hypocrisy is lying. But it is more. When we think about a lie, we know it is about deception. And we know lies are not good. However, we also recognize that such deception comes in varying degrees. We even understand there are situations where good people might lie, and we don't become all judgy about it. In fact, an entire lexicon has developed around the concept of lies — white lies, fibs, exaggerations, partial truths — describing minor infractions that don't hurt anyone.

However, there are no varying degrees, no shades of grey, no redeeming qualities, that can exist with hypocrisy. It is more than a single lie; it is a constant and consistent effort to mislead, conceal, and deceive. We cannot imagine worse than the moral ambiguity of a person who pretends to be our friend, pretends to hold our beliefs, pretends to be on our side, only to discover a wall of lies intended to serve the individual's self-interests. We have been hoodwinked and we do not take kindly to it.

Because of its impact on our lives — personal and business — both internal auditors and non-auditors must watch for hypocrisy and take action when it is discovered. And that starts, as does any ethical voyage, with self-evaluation.

What follows is only part of a story. Generally, I am forthcoming with my faults and foibles, but this one still stings. It is far from my finest moment, so I'll be giving few details. (And at this point I usually say, "If you want the full story, meet me afterwards at the hotel bar." But the full story does not come so freely. Tell the bartender to leave the bottle.)

Toward the end of my career with Farmers Insurance, I led a consulting project. Coincidently, the supervisor over the process had been supervisor when I conducted a similar exercise over another process several years before. Circumstances on that first project resulted in my not handling it correctly. My bosses took steps I did not know were going to occur and the supervisor was hung out to dry. Not an excuse; just the facts. The individual, correctly, held me responsible for the poor communications and subsequent career impact.

At the outset of the new project, the individual brought up the prior situation. We were able to clear the air and I promised it wouldn't happen again.

Can you predict what happened next? Can you guess the punch line?

I did it again. And this time I couldn't even blame management; it was all me. Like a slow-motion train wreck, I watched myself allow events to transpire that I had promised would not occur.

Hypocrisy: Saying you have a belief in one thing and then doing something else entirely.

I have no explanation. I have no excuses. It happened and I can't take it back.

Was this hypocrisy? I would say no. (Of course, I'd say no. I'm the one who did it, so I'm the one that needs to justify my actions.) I would say it wasn't hypocrisy because the words I said and the actions I took were not meant to hide my true intent and feelings. What I told the individual did, indeed, match my personal beliefs. But, for the individual who again suffered because of my stupidity, how could it have been interpreted otherwise? I said I would do one thing. I promised I would do one thing. And then I strode forward and did another.

Hypocrisy: When what you say does not match what you do.

What does this look like in your department or your organization? It is an important part of the work internal audit should be doing around culture and ethics. When we talk about tone at the top, environment, and culture, the impact of hypocrisy cannot be understated. Do leaders' words match their actions? Do leaders fulfill their promises? Or does hypocrisy reign?

Another story from the real world. I was having dinner with a group when the conversation turned to their CEO. I mentioned his communications indicated some good things were going on in the organization. I was almost laughed out of the restaurant. (Gallows humor.) They let me know that the leader did an excellent job of talking about organizational excellence and openness and value and people and various other happy-peppy concepts expected from forward-thinking organizations. In fact, he was a frequent keynote speaker, sharing how he ran his successful operation.

But reality did not match the beautiful words he so liltingly proffered. Instead, he had built an organization where silos quashed potential collaboration, communication among departments was almost nonexistent, cost-cutting was revered over service and excellence, complaints of hostile workplaces and lack of diversity were ignored, backstabbers were rewarded, mass turnover was the rule, and those who remained were effectively working in a world of fear.

This may seem an exaggeration, but it was the message I heard from those who worked in that organization. And for every one of you saying, "That couldn't really happen!" there are just as many wondering if I'm talking about their organization.

Hypocrisy: When a leader's words aren't reflected in their actions or in the behaviors that are rewarded.

Here's another good question. How does a leader, co-worker, or friend react when potential hypocrisy is pointed out? If they are willing to recognize the problem and take steps to effect personal growth, then it speaks volumes about the individual's moral compass. However, the hypocrite that is confronted with their crime and does nothing — who makes excuses, who blames others, who refuses to take responsibility — is telling you everything you need to know about their ethics and morals. And the message is not a good one.

And the worst excuse? Using hypocrisy as a crutch for success. If anyone — a co-worker, friend, leader — feels the only way to get something done is through hypocrisy, then their moral compass is not only broken, but there is some question whether they ever had one. Hypocrisy used in the name of expediency is cowardice.

You know what? We use phrases like "tone at the top" or "walk the talk," and it may be time to quit. These are just euphemisms — pretty words — that obfuscate detestable acts. When we are willing to call hypocrisy by its true name is when people may wake up to the issue and do something about it.

"It's amazing how much panic one honest man can spread among a multitude of hypocrites." – Thomas Sowell

All of the above came about because the word "hypocrisy" has crept into the national conversation. And this might be a good thing, not because of the hypocritical actions that have raised the debate, but because the conversation is elevating our awareness of the issue.

Internal audit should consider hypocrisy as a part of any audit regarding culture or ethics. But when any of us see hypocrisy — within ourselves, within our organizations, or in the real world — we need to call it out. And we need to take up action against it. In a recent blog post I discussed how the leaders we choose to follow are a reflection of our personal standards — that individuals will judge us by who we follow. And when we choose to continue following leaders who exhibit the hypocrisy we should abhor, we become as hypocritical as the hypocrites themselves.

As Warren Buffett famously said, "It takes 20 years to build a reputation and five minutes to destroy it." And nothing can destroy that reputation — a leader's reputation, a friend's reputation, or your reputation — quite like the curse of hypocrisy.

Mike Jacka, CIA, CPA, CPCU, CLU

Co-founder and Chief Creative Pilot, Flying Pig Audit, Consulting, and Training Services (FPACTS), based in Phoenix.