Article / 03 January 2014 at 13:45 GMT

The seven pillars of Saxo Bank's strength

co-founder & CEO / Saxo Bank A/S
Denmark

By Lars Seier Christensen

In the second of his three-part series, Lars Seier Christensen focuses on the seven values of Saxo Bank. If you missed part one, you can read it here.

The good thing is that capitalism brings people — by their own choice —  together with joint goals, which makes sense for everyone and benefits the employer, employee and client alike. As a result, finding common ground is easier than if we were a political organisation or a cultural or religious forum. In fact, we have representatives of every major religion, culture, nation and race among our employees and although we face issues from time time, like any other organisation, they are never really based on those differences. It is a given that in a meritocratic organisation it is the results, the ethical behaviour and the productive efforts that count over and above and anything else.

In our first, pre-Ayn Rand, corporate statement for Saxo Bank in the late 1990s, we still felt the need to state things like that explicitly. But today, it is all about the set of values and the interaction we can expect from each other that we set out to describe.


 Saxo Bank

 Ayn Rand's Seven Virtues have formed the basis of Saxo Bank's values. Photo: Saxo Bank


And after having read Rand's works and becoming familiar with her Seven Virtues, Kim Fournais and I were in no doubt that what was meant as guidance to living a successful, prosperous and productive life for an individual, could equally serve as values for an organisation to build upon. Later on, I was very pleased to discover that at least one other bank had made the same decision. BB&T Bank in the US, led by the formidable Rand supporter, John Allison, had been successfully applying the Seven Virtues well before we had heard of them and has built a great business on this foundation. It is interesting that BB&T Bank was about the only major American bank to come out of the financial crash unscathed.

I would like to run through the Seven Virtues and describe how we ask our employees to consider and understand them in a business context.

Some of you will know that Rand developed the Seven Virtues, or Values, as we have chosen to call them in the Saxo Bank context, as a non-exhaustive list of important virtues to adhere to. They are: RATIONALITY, INDEPENDENCE, INTEGRITY, HONESTY, JUSTICE, PRODUCTIVITY AND PRIDE.

We introduce the Seven Values to our employees along these lines:

You may not be guaranteed a successful career or a great life — accidents, illness or other random elements may interfere — by applying the values to your work, but it is difficult to imagine that anyone could live successfully if he or she continuously disregards and violates these values.

Just try this experiment with each of the values: if you were continuously dishonest, so that no one trusted you, could you succeed with this for a lifetime?

Or what if you disregarded justice, so that you never encouraged what is good around you and made no difference between valuable and worthless activities — making no distinction between productive and destructive actions?

No decent human being would want to associate themselves with you if they felt you did not distinguish between good and evil, right and wrong.

And so it goes for all these values — they are necessary ingredients in a good life and, for Saxo Bank, essential for building a strong, reliable, competitive business.

What is so great about the novel, Atlas Shrugged, is that it gives you a more detailed, philosophical foundation for what you intuitively know is right.

It tells you what creates results and why other, contradictory sets of values are unlikely to create long-term success.

We go on to give ideas for practical application of the values in everyday work:

About Rationality

Behaving in a rational fashion seems like an obvious thing to do, but actually, in many organisations a lot of time is spent on very irrational and unproductive activities. Rationality means applying a logical approach to identifying how to arrive at a desired end — or to gain a desired value — in the most efficient and straight-line manner. It also means taking into account the relevant information required to reach decisions and to decide on an optimal path of specific action.

If a competitor has created a better product than our own, you cannot talk it into oblivion. Even if, in the short term, you might convince a client to accept an inferior solution. Longer term, you are always at risk of this client becoming more informed and, ultimately, you will lose out.

The only way to deal with competitive products is to investigate them thoroughly, take an active interest in industry developments and meet any challenges head-on by improving our own service and the features of our products.

You cannot dream, wish, hope or lie yourself out of a difficult-to-fulfil, but reality-based client demand.

If the client can get a better service or product somewhere else, we need to deal with this reality and improve to maintain the relationship.

If you have a disagreement with another employee, you also need to deal with it head-on. If you are right, then you should stand up for your point of view, but if you are wrong, acknowledge it and move forward.

You should not pursue any line of action for any other reason other than it being the most rational and logical way to move forward — even if it means giving up your own (inferior) idea, or if it means the justified recognition of one of your colleagues instead of you.

Making the right, rational choices is what life is all about. Just as irrationality leads to failure or at the very least dependency on other people’s rationality, rationality often leads to success and independence. In fact, it almost always does if consistently applied and carefully and intelligently executed.

About Independence

All of the virtues are actually derivatives of “rationality”, and this one, in particular, means using rational thinking in an independent manner. In spite of all types of teamwork, all types of organisations and all forms of society, it simply boils down to one brain per individual.

There is no such thing as “group thinking” (don’t confuse that with individual thinkers choosing to work together in a group) or a “collective brain”. Whether you like it or not (and we hope you do like it), everyone has their own individual mind that he can choose to use or not.

Your mind is your primary tool of survival, but also the gateway to much more than mere survival. To a large extent, the more and the better you use your mind (which implicitly means independently), the more successful and — at least if applied to commercial business — the more comfortable a living you will be able to create for yourself and whomever you choose to share your life with. And the more personal fulfillment and self-esteem you will experience.

Independence does not mean re-inventing the wheel, or not accepting the Law of Gravity or Einstein’s scientific theories before you have checked all the facts and calculations yourself.

It does not mean a lack of respect for where you work, if that is freely chosen by yourself, or for the managers or leaders you interact with as a result of that decision; nor does it mean having to define or create every single process personally before implementing it.

Independence does not mean that you should not learn from anyone else. But it does mean that blindly copying or repeating anything and everything you see or hear uncritically will not get you anywhere in the long run.

 If you unquestioningly accept anything that sounds good without further consideration of its consequences or any idea that simply seems to be agreed upon by other people (even — or maybe even particularly — if they are a majority), you can be fairly sure that this will not be a great success in your life.

About Integrity

Integrity is standing up for what you mean and being prepared to execute your ideas and defend your values. Integrity is therefore closely related to the value of independence. Integrity is about doing what you say you will do, honouring your commitments and fulfilling your promises.

 Integrity is accepting that there is a relation between the dreams you have for the future and the work you need to put in every day to reach those goals, otherwise your life will just be an endless repetition of frustration and disappointment.

At Saxo Bank, extending this integrity to our clients and partners is, of course, critical. We need to manage expectations correctly, so that we invariably deliver at least what we promise.

Conversely, we need to be very careful to explain to clients exactly what our services are and what risks and opportunities they will face while working with us.

There is no real substitute for an integrated view of life. If you are not basing your life on reality, either you will fail or you will be entirely dependent on someone else to support you because they act rationally on your behalf — a parasitic and unsatisfactory existence at best and a highly risky proposition for the long term. 

About Honesty

Honesty should be understood in the normal sense — for example, do not unnecessarily lie to others — as well as the concept of intellectual honesty. Being honest means meeting reality head-on and trying not to fool yourself or others by not trying honestly and in an objective manner to interpret and deal with the facts that you are faced with.

Being dishonest can take many forms, such as lying to clients, colleagues or friends. This will not be beneficial in the long run as the truth becomes inevitably clear sooner or later, and future relationships would be greatly damaged.

Dishonesty could also be pretending to be something you are not. For example, would getting a particular job because you lied about your abilities not be more disastrous than not getting the job at all? You will ultimately end up failing, losing credibility and, in the meantime, having failed to make progress at something you could have been great at instead?

Attracting a spouse or a circle of friends by pretending to be a different character than you really are?

Forcing yourself to live a life that is not what you really wanted — presenting a façade that you need to think about every minute of the day because it is not honest to your nature — and again, probably eventually getting called on your bluff after all those efforts.

Being honest is a selfish value, as are all sustainable values. Honesty is for your own benefit; it is not just a duty you owe to others.

All of Rand’s values serve the purpose of making your life more successful and your philosophy more coherent. The great thing is that applying the values also has beneficial implications for your surroundings, friends, colleagues, Saxo Bank, society… which are all components in helping your life to be successful. So there is a win-win effect in honesty, just as in the rest of our values and the contents of the corporate statement, which is exactly what we want to portray.

About Justice

Justice, in our terms, essentially means that you should not just sit back and accept everything around you without having a view on it. You should not be afraid to speak up when somebody does wrong or behaves in an unacceptable manner.

By keeping quiet, you are not doing the person a favour because that person may not be aware that what they are doing is questionable, or, if he or she is, they may think that doing the wrong thing will never have any negative consequences for themselves — hence encouraging them to continue that way.

Along the same line of thinking, you also should give praise when someone does something positive, not just to be nice, but to encourage such actions in the longer term, to show that you notice and that it makes a difference to you.

In terms of Saxo Bank, this is closely related to the value of honesty and essentially means that you should neither hold back constructive and justified criticism nor should you fail to praise a colleague who does something of value or ethically correct when you see it.

When we are doing unbearable damage is when we fail to recognise appropriately those people who are doing great things.

Whether this is out of envy or indifference, it is very damaging when people who should be praised fail to get the recognition they deserve.

Being just is both the right action towards your colleagues and a way to increase your own chances of long-term success — by correcting mistakes and encouraging good work.

About Productivity

Being productive means creating products, systems and services that are valued sufficiently by our clients to enable us to run a successful business and for all of us to be paid a salary that allows us to care adequately for our families and ourselves.

Being productive means taking pride in providing for your own life, avoiding relying unnecessarily on other people’s production and recognising that any other way of living — stealing, voting for politicians who give you money by taking it from other members of society, begging — may work for you short term, but would be completely unsustainable unless someone else made the decision to produce.

I think that we all know the joys of a job well done. To achieve success, to use one’s mind creatively and productively, to see things grow and expand through your own efforts is a great experience and life would be much poorer if we did not experience this individually, and together, every day of the working week.

Enjoying the fruits of work, getting the things you want, having fun and free time on your hands, enjoying hard-earned time with your family is all great — but getting there, securing this through your own efforts, is a big part of the exercise.

Productivity plays a big part in all we do. It is important that we always bear in mind productivity in our lives as a necessary and logical objective. It is great for us to spend time on research and thinking ahead, and having great plans and long discussions if necessary. But at the end of the line, the goal is productivity.

Any initiative we undertake in our business must have productivity as the key objective because if we allow ourselves to lose sight of productivity, eventually the business will fail and we will all lose out in life.

About Pride

Most people, certainly most Danes, have been brought up with the notion that pride is mostly a bad thing and that people should be humble rather than proud.

“The Law of Jante”, a particular Danish version of the “tall-poppy syndrome” deriving from a famous novel, criticises the success of individuals and portrays their achievements as unworthy, wrong or inappropriate.

We believe that you are indeed responsible for your own character, your own achievements and your own results; and it does matter that you try to do well.

Even in your fundamental choice — deciding to be a productive individual, taking charge of your own destiny and responsibility for your life instead of relying on other people for your sustenance — you have reason to be proud. By having decided to work for a living, instead of stealing or begging your way through life, you have established a critical foundation for justifiable pride.

The rewards for leading such a life are the values — both physical and spiritual — that you can create, allowing you to have self–esteem and to be proud of your life.

I hope this has given you an idea about how we practically deploy Ayn Rand's ideas in a modern business. The great experience has been that people embrace this message, they actually want clear values in their life, and in the business they work for, and we have seen a lot of interest in these thoughts since we introduced them more formally through our corporate statement. Most employees have read Atlas Shrugged, and most are good capitalists. I don’t think you would be very happy as a socialist in Saxo Bank, I certainly hope not. We have several sessions every year where new employees learn about the values and principles, or old employees can refreshen their knowledge.

In part 3 on Monday: Lars looks at the broader relevance of Ayn Rand in society today.

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