Election gambling scandal: bad culture will kill your organisation – you can bet on it
Whether illegal or not, the gambling scandal engulfing the Tory party is only the latest example of morally indefensible behaviour.
Just as people go bankrupt in two ways – gradually, then suddenly, as Ernest Hemingway famously put it – so organisations corrode morally, first bit by bit and then all in a rush. We are seeing this play out for the Conservative party in the final week of the UK’s general election campaign.
After almost two weeks of delay, the party finally decided to withdraw support for two parliamentary candidates: one (Craig Williams) who has admitted to placing a bet on the election and another (Laura Saunders) who is so far not saying if she did or not. She has agreed to cooperate with an investigation by the Gambling Commission on the matter.
They are two of an unknown number of people close to prime minister Rishi Sunak – including his police protection officers – who are being investigated after a surge in betting was recorded just before Sunak called an election for July 4. The bets – wagering on the date of the election – were placed before the public announcement and therefore could have been driven by the use of inside information.
The Labour party is not emerging untouched by this scandal, either. One of its candidates in a safe Tory seat (Central Suffolk and north Ipswich) has also admitted to having placed a bet … on his opponent, to win.
Williams issued a kind of semi-apology to voters in his Welsh seat of Montgomery and Glyndŵr. He had already conceded that his “flutter” on the election was “a huge error of judgment”, but his later claim is that what he did was “not an offence”.
It will be for the Gambling Commission to decide if Williams’s interpretation of his actions, and the law, is correct. The use of confidential information to place bets, if regarded as cheating, is illegal. Williams is a close friend and ally of the prime minister, Rishi Sunak, and was his parliamentary private secretary (Sunak’s “eyes and ears” in Westminster).
Signalling downfall
It may be seen as a red flag when a chief executive or senior official defends themselves against allegations of malpractice with the claim that they have not actually broken the law. Some may recall Sir Philip Green in front of a UK parliamentary select committee defending the legality of his actions during his takeover of British Home Stores and the handling of the company’s pensions. (He eventually agreed to pay £363 million into the pension scheme.)
The problem for the Conservatives is that – illegal or not – what is claimed to be this latest episode of moral slippage and “poor judgment”, is hardly an isolated incident. Central among a litany of other scandals was “partygate”, when a prime minister denied at the dispatch box that there had been any partying at 10 Downing Street during COVID lockdowns. Plenty of evidence subsequently emerged to show that this was not true.
There’s more. A former chancellor had to (re)pay millions of pounds in tax after an (undisclosed) dispute with HMRC, the tax authority. Questions persist about the terms under which millions of pounds of public money were paid out to friends of the Conservative party to supply sometimes faulty personal protection equipment (PPE) during the pandemic. Two senior ministers had to step down following accusations of bullying. Another MP was ejected after being caught offering to leak information to reporters posing as lobbyists from the gambling industry.
And all this after Rishi Sunak had arrived in office promising to deliver “integrity, professionalism and accountability” in government.
Two familiar cliches in British politics – the Westminster “bubble” and the Downing Street “bunker” – hint at the risk of isolation and detachment from the real world of ordinary citizens that comes with governing.
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It is almost as though London SW1 is in the grip of what psychologist Irving Janis described as “groupthink”. There seems to be a lack of cognitive diversity, at least at the top – but perhaps not only there. In these circumstances, moral slippage is all too easy. Not enough people are present with the courage and independence of mind to object to wrongdoing or questionable decisions – although a stronger and more confident civil service might help.
As Jeffrey Pfeffer at Stanford’s Graduate School of Business has long argued, power and hierarchy have significant effects that need to be understood. If we want better leaders, then we need better people to want to go into politics and business.
A wise executive once told me: “The lowest standard of behaviour you tolerate is the highest you can expect.” Why did Sunak take almost two weeks to realise that he had to take action regarding his old friend? The moral collapse of today’s Conservative party would appear to be complete, and it is a collapse that has happened gradually, then suddenly.
Stefan Stern does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.