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A Principle, a Standard, and a Regulation Join a Zoom Call

Insert joke here. Mea culpa: This title does indeed set an expectation for a good joke to follow. While I made several attempts, the ensuing punch lines were categorically poor—by which I mean overly reductive and just not very funny. Thus, demonstrating that my policy to never craft my own jokes on principle is a good one.

Jokes aside, governance is a tricky business. Formulating a comprehensive strategy is simply not simple. What your organization says it values, how it (actually) behaves, what it rewards, and how responsibility is distributed, shared, and enforced all have a role to play. 

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Today, discussions about responsible technology, ethical technology, and ESG (environmental, social, and governance) standards continue to swirl—particularly around the topic of AI. Organizations, public and private, are codifying principles, regulations are emerging, and standards are proliferating. These are all tools designed to promote and, in some cases, compel good behavior and ensure favorable outcomes.

To adapt an old adage, we shape the tools we use to govern, and, thereafter, those tools shape us. It seems timely, therefore, to revisit what different written governance mechanisms seek to achieve and how they work together. Fair warning: I will lean into the concept of principles since recent conversations suggest that we often expect them to shoulder too much of the burden of governance. (Definitions cited are taken or paraphrased from www?

Principle: This Is What We Believe

Principles describe “fundamental truths or beliefs intended to guide behavior or a chain of reasoning.” In searching for synonyms of principles, you will find concepts such as philosophies, ethics, morals, and values. Simply put, principles codify what an entity broadly believes to be right or wrong. However, principles are not prescriptive in nature. Rather, principles endeavor to:

  • Signal intent: Principles such as these from OECD (Organisation for Economic Co-operation and Development) express what an entity—an individual, an organization, or a society—believes is important and why. Principles foreshadow how an entity intends to operate in the world—and, very often, to whom or what they hold themselves accountable, be they shareholders, customers, employees, society at large, and/or the environment.
  • Guide behavior: Principles, done right, nudge individual thought and behavior in a desired direction—even, or especially, in the absence of discrete rules and above the constraints of discrete roles. Indeed, principles are particularly relevant when it is impossible to foresee or define hard-and-fast rules for every eventuality.
  • Normalize attitudes and beliefs: Principles create a common narrative and serve as a lodestone to align the organization in a unified direction. They create consensus around what is common, even if opinions about how to achieve the vision differ.
  • Encourage introspection and engagement: By starting on common ground, principles pave the way for difficult conversations that occur when opinions diverge.

Principles ground your governance initiatives. However, your aspirations may be misplaced if you expect principles to provide:

  • Hard and fast rules: For hard and fast rules, look to regulations, standards, methods, and metrics. Principles often underpin these artifacts. But if you can conceive of every nuance of every circumstance which necessitates a decision, principles be darned. Principles are best used to convey ground truths to guide behavior in the face of uncertainty, not absolute certitude.
  • Convenience and absolute coverage: Principles won’t keep people from making mistakes or getting in trouble. However, if well-articulated, they should make it clear when trouble is, to paraphrase the late great U.S. Representative John Lewis, “good trouble,” or when you may just be plain wrong.
  • Mutually exclusive or equally applicable: Applying principles is an exercise in balance. It’s about aligning expectations and providing fodder to prioritize what are often competing imperatives. The context in which data is being used may change the relative priority or relevance of individual principles. For instance, an IoT application to detect material defects is concerned less with bias and inequity than it is about safety and robustness.

Of course, if you’d like to ensure your principles are farcical and only look good on paper, you can:

  • Preach what you don’t practice: It is easy to espouse high-minded ideals when business is not on the line or doesn’t stand in the way of achieving a personal goal. Organizations must ensure that how they behave reinforces the principles they espouse. Your personal and brand reputation—not to mention your employee’s trust and engagement—may be on the line if you don’t.
  • Withhold authority and agency: What if those individuals do not have the authority or autonomy to make their own day-to-day decisions, there is little point in giving them principles to follow. Without responsibility or autonomy, principles become a paper exercise. If those same principles don’t align with employee incentives? Or your employees don’t see you modeling those principled or they are rewarded when they deviate? Culture eats strategy principles for lunch. Every time.
  • Penalize the principled: There is no doubt that conflicts will arise when treading a principled path. It could be argued that principles are intended to cause that exact outcome, thereby ensuring that potentially deleterious or unethical actions are routinely exposed to the light. You don’t have to achieve absolute consensus on every policy or decision informed by your principles. You must, however, be open to the conversation.

Once in hand, there are several mechanisms an organization can engage to ensure its principles are reflected in its day-to-day practices. 

Policy: This Is Our Approach

Policies designate “a course of action.” Look at a definition of “policy” and you will find references to plans, strategies, approaches, and blueprints. Done correctly, policies chart the course between principles in theory and a plan of execution to put principles into practice. A well-crafted policy will:

  • Clarify expectations: Clearly state how individuals are expected to engage and detail explicit outcomes or activities that they are responsible for or accountable to.
  • Designate authority: Define who has the right to decide what. Whether it’s a governing council, an executive, or an individual contributor, policies should clearly delineate the boundaries, responsibilities, decision rights, and intersections between stakeholders.
  • Provide guidance on priorities: As previously noted, principles do not always operate independently of each other. Policies govern what takes precedence and how a tie is broken when conflicts arise.
  • Encourage progress over perfection: The best policies, in my experience, favor progress over perfection, thereby avoiding the perennial governance chicken-and-egg dilemma—namely, avoidance of codifying a policy due to lack of current compliance. Compliance, in turn, is hampered by a lack of policy to make the requisite actions so. It’s an easy trap to fall into.

Good policies go wrong when they, in essence, do none of the above. Your policies are likely more performative than productive if they:

  • Prioritize perfection over progress or expect to “go green” overnight
  • Do not clearly identify who is responsible for what
  • Do not anticipate change and provide a mechanism for evolution over time
  • Are not enforceable or enforced
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