Why values matter and how to nurture them in business

Ronnie Peiris retires at the end of 2017, having held senior leadership positions as JKH’s Group Finance Director and at Pan-African mining firm Anglo American previously. At a time when companies are under pressure to grow shareholder returns, he discusses why people matter and lays bare the moral compass that has helped him navigate the complexities of modern business

Over the years, I have come to realise how values people bring from their family infiltrate your professional life. In business, you will be amazed at how little some so-called professionals know about professional conduct. Take a chartered accountant. There is a code of conduct, a professional ethic to be upheld. That code says you first serve society and the public, you then serve your profession, the employer comes next and finally yourself. In my experience, maybe 10-15% of our professionals are sensitive to this. It is frightening when you think of what has been happening in our country.

In every seminar, everyone talks about corruption. I was in a panel from the corporate sector and my first question was, ‘Yes, these things happen, and where do professionals fit in? Does anyone have the guts to stand up and say, ‘this is not in compliance with my profession, I cannot do it’? It is frightening to think that our budding professionals either lack confidence in their own ability or they are unawareof their professional obligation, and therefore lack the necessary courage and knowledge to stand up.

VALUES AND THE TONE FROM THE TOP
At John Keells, the tone from the top is firm. Ethics, integrity, professional conduct, doing the right thing and meritocratic behaviour are non-negotiable, uncompromised principles here. The dilemma is when the tone from the top is absent or inconsistent. In a vacuum, there is no model to follow, no father to slap your knuckles and say you’re doing the wrong thing.

Incidentally, our top management in the country consists mainly of those two schools. While these schools might be considered elitist, they also impart good values. I remember, at school, we never thought of anyone as a Tamil, Sinhalese or Muslim. We have the same kind of thinking at the workplace. It’s a completely meritocratic environment. I’ve been saying we should bring in disruptors, someone who would challenge the status quo.

The next 15 years at John Keells will be different from the last 15 years. The next board will have a chance to implement their style of thinking. It is important to be able to trust and have honesty, integrity and transparency. These values often come from the family, and they make delegation and empowerment in the workplace much easier.

ETHICS, INTEGRITY, PROFESSIONAL CONDUCT, DOING THE RIGHT THING AND MERITOCRATIC BEHAVIOUR ARE NON-NEGOTIABLE, UNCOMPROMISED PRINCIPLES AT JOHN KEELLS

As a leader and a professional, I have tried to live with humility, simplicity, understanding and by making people feel wanted. I have an open-door policy. My secretary isn’t here to keep people away but to welcome them. I like to come to work by 7am, so by 8.30am when everyone else arrives, I am ready and available. I don’t have much actual work. We hold meetings and do the thinking, and for that, you need people to come talk to you. If you live in an ivory tower because you believe you are different and make yourself unapproachable, no one will come to you, and ultimately you will lose out because you won’t get the extra input from across the company helping you make better decisions.

I was lucky that my parents were fantastic role models. The greatest gift they gave me is teaching me right from wrong. The principles of what is right and what is wrong are the same around the world.

LEADERSHIP
You have to have a positive outlook on life. Empathy is also very important, that is being able to talk to different people in different ways. All that comes with experience. I have risen from the lowest to the highest level, so when someone comes to me, I can relate to how they feel because I have been in their position. The world would be very boring if it wasn’t for diversity. Just imagine having a wife who doesn’t argue. I think it’s good to have a strong partner who disagrees because I think your life – spiritually, sexually and emotionally – will be more exciting. We need a diversity of opinions and views.

I learnt everything about managing people, situations, on being a good leader and on listening to people from my time in Zambia. The need to listen to people is something I learnt the hard way. Back then, I would jump to conclusions and make my own interpretations. Later, I learnt to listen to the end, listen from my heart and to keep an open mind. I’m not sure if I would have learnt these things if I had stayed in Sri Lanka.

When I joined Anglo American (a South African mining company) in February 1979, they were a conglomerate, just like John Keells, with businesses in sugar, mining, hotels, explosives… you name the industry, they were in it. At one point, they were said to own 52% of South Africa’s economy. It’s only in the late 90’s that they decided to focus on mining and shed all other businesses. They just held on to paper and mining.

One of the big problems of mining was CO2 emission. It’s a heavily regulated industry. By and large, it was a very tough industry to balance shareholder returns, while making sure some pillars of sustainability are safeguarded. I once had to face a mining accident in 2001 that killed 11 people. Fortunately, the insurance was in place, but following the incident, as a professional, I asked myself many questions: if I could have done anything better or handled the risk management better. So, even this was about finding a balance between risks and returns. My character had been formed by the time I came back. So, it was easy for me to carry on in the same way in a very different Sri Lanka.

FOCUS ON RISK
Even now, at JKH, the first things we look at when a project is presented to us are the risks. Not only financial, but risks to society and the environment. It has become a huge part of our project conversations. Our philosophy is that good things will happen anyway, and so we need to focus on the risks – from financial risks to products, brand image, employees and everything else. Risk management means that you need to spend money upfront in order to prevent that risk. Some people just scoff at risk management and say it’s an unnecessary expense. But, in reality, it’s a hedge, a financial instrument.

I’m hoping for a leader who wins because he or she will do the best for society. First, serve the public and the society, then the profession, then employer and then yourself. Put yourself last; be a selfless leader

CONGLOMERATE DISCOUNT
Investors prefer to focus on a specific industry because the conglomerate model can get very hazy. However, I still believe in something called the parenting model. Look at John Keells: at the centre, we have functions like tax, finance and HR at the cutting-edge level. The total cost of these services couldn’t be afforded by some of the individual companies, but in the parent model, they are available to all 17 businesses irrespective of their size.

SUSTAINABILITY
Most companies are obsessed with returns and KPIs, all the hard-coded stuff. But, if we keep up with the world, we will soon realise that what started as a fad – like this whole emphasis on sustainability, the environment and the stakeholder model – is now real. At JKH, we may have been obsessed with numbers and doing CSR without a meaning in the past, but since about 20 years ago, society has become a key element in the equilibrium. We talk about our sustainability pillars very clearly. Our businesses, particularly the chief executives, now realise that, by doing good, they enhance their bottom lines. We still strain for every percent of shareholders’ return, but not at the expense of society.

I have seen huge glossy annual reports with a big section on sustainability, as if taken from a textbook. It is unfair of me to judge, as only they know what really happens; but, as a matter of principle, an annual report cannot contain anything you don’t do. That is why JKH’s goals are regularly reviewed, matched and analysed. We have an English language programme in Trincomalee, Habarana and in the North. By encouraging English in areas where our hotels are located, we also make it possible for the tourism industry to grow. We have programmes supporting leopards in Yala, and the adoption of villages that can later supply goods to the hotels. Sustainability is a key part of the agenda. At first, most of our business units resisted. Now, it has become a part of our performance management, and there is acute awareness at every level because everyone understands that it is linked to the bottom line.

I think we are now coming to the next stage. What is going to matter the most in the future is a sense of purpose. We will have to have a very clear sense of purpose for which we exist as an organisation. Throughout my life, I have believed that everything depends on how an individual stands up to a challenge. In many cases, people put themselves in an ‘unlucky’ position because they are more interested in the short term and lack long-term objectives, and are not willing to work for it. I’m not ashamed to say that, for two years of my life soon after getting married, I ate just plain rice and a piece of dried fish, because I had to pay the house rent. We were living hand to mouth. We then had the expenses of a young family after our daughter was born, when I was 23. I used to get up early to travel to work by bus. You have to be determined. You will run into bad luck, but you have to be willing to do whatever must be done. You cannot make excuses.

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WHO IS RONNIE?
His background, views and turning points

Name: Ronnie Peiris
Position: Group Finance Director at John Keells Holdings
Born and raised: Mount Lavinia
Lived abroad: 25 years in Zambia
If not finance, what other career? Medicine. I would’ve become a doctor as my father wished
What is the first thing you do at work every day? I write down everything I need to do on a piece of paper. When you cut your tasks into small pieces, nothing is too big. I learnt this while I was doing my MBA at age 40
What was working in Zambia like? Zambia got its independence in 1964, so their first graduates came out in the early seventies. We came there to help them manage their economy and their own affairs. It was where I learnt the importance of giving knowledge to people. Since then, I have shared my knowledge with whoever listens. All of my successors there were Zambians; some of them are still at the company. This gives me a lot of satisfaction.
Zambian people are hard to describe: they might look daunting at first, with different features and a different voice, but they’re hard-working and humble. Zambia taught me that management principles should vary according to the situation. Sometimes, you become a missionary and let a guy cry on your shoulder, other times you come across as a cynic. You have to change your management style based on your audience. In Africa, the non-whites were generally discriminated against. Then, the hurdles you have clear are much bigger than if you were a white person. Thank God, my company never discriminated.
What was it like to work in the mining industry? I’ve been fortunate to work for top-class, ethical companies, even in the most difficult industries. Greenpeace and Transparency International used to keep a close eye on the mining industry. It is a difficult industry where health, hygiene and safety can get compromised, but Anglo did its best. Their intentions were always honourable.
One of the big problems in mining was the emission of CO2, which is now strictly regulated by the local government. It wasn’t easy to find the right balance between shareholder returns and sustainability pillars. Anglo did a very good job. There has always been tension from NGOs, and I think that’s good. Sometimes they were right, sometimes they exaggerated, but there was always a healthy tension. I learnt a lot there.

Zambian people are hard to describe: they might look daunting at first, with different features and a different voice, but they’re hardworking and humble

What was the most difficult lesson? I remember we had a huge mining accident in 2001. An open pit collapsed, 11 people died and much of our equipment was lost. We were asked questions about safety and our processes, and nothing went unanswered. Mining is somewhat like the airline industry. It is a balance between how much you spend on engineering, hygiene and safety, and what is operationally required. It is always a balance. You have to endure outside scrutiny in industries like mining. It is a difficult one, particularly in Africa. By the time I came to John Keells, I had a very good understanding of how to work with society as a stakeholder.
What’s your greatest regret? I have a personal regret that I missed the coming of age of my daughters. My wife and I were both professionals, and we were so obsessed with our careers that we actually missed the growing-up stage. You know, the funny thing is that my grandchildren say things I can’t recall experiencing with my daughters. So, if I were to change one thing in my life, it would be to keep my daughters at home instead of sending them abroad. They turned out to be fantastic children, but if I could, I would focus more on my work-life balance.
What about politics in Sri Lanka? I think people should start making hard decisions for the sake of the country, not only to stay in power. I’m hoping for a leader who wins because he or she will do the best for society. There should be a professional. First, serve the public and the society, then the profession, then your employer and then yourself. Put yourself last; be a selfless leader.
You are retiring from JKH. What does this milestone mean for you? It is a good time to look back. I still have a lot of energy and I believe I can give to society and be helpful as a teacher, coach and by consulting. That’s the next phase of my journey.

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TOUGH JOURNEY GREAT DESTINATION
Guidelines from a veteran in business

Looking back at over 45 years of professional experience, Ronnie Peiris guides readers through the formative moments of his life to illustrate the values he finds essential to becoming an effective leader. In his book, difficult experiences become lessons and fond memories a source of inspiration. He asks moral questions, challenges cultural stereotypes, highlights workplace responsibility and gives practical advice to aspiring professionals. In eight chapters, Tough Journey Great Destination lifts the veil of high-level business, from the mining industry to conglomerate culture, and serves as a down-to-earth handbook to the exciting path of professional growth.

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