Cultivate Your Corporate Culture

Arvin Maskin, a partner in the law firm of Weil, Gotshal & Manges, and is co-chair of the firm’s Products Liability & Mass Tort Practice Group, writes in BusinessWeek  that ,”in the event of a product safety problem, product makers should be prepared to defend themselves. Raising awareness among employees is essential to the process.”

Lately, product safety crises have been strewn across the news. Remember the peanut-product recall, melamine in pet food, e-coli in spinach and tomatoes? Lead in toys? These problems highlight a huge challenge for corporations: “Cultivating a culture of risk avoidance and accountability at every level of the business.”

Obviously, averting the crisis in the first place is far more preferable to handling the enduring legal and financial consequences. The best way to avoid these incidences is to emphasize the importance of risk avoidance and accountability, and train employees on an ongoing basis.

According to Maskin, ”Creating a culture of risk avoidance and accountability requires education of employees at every level. It is not always intuitive.”

Enterprises must “consciously inject risk avoidance into employees’ thought processes. From the standpoint of corporate governance, the notion of informed and continual risk assessment and avoidance is fundamental.

Given what is at stake, it ought to receive the highest priority.”

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