Jon Huntsman’s Secrets for Business Success Leading Wharton Graduate Says: “Winners Never Cheat”
What is the key to success in today’s competitive business markets? According to self-made industrialist Jon M. Huntsman, W’59 — founder and chairman of Huntsman Corp., the world's largest privately owned chemical company, and lead donor for Wharton’s Huntsman Hall — “the ingredients for long-term success — courage, vision, follow-through, risk, opportunity, sweat, sacrifice, skill, discipline, honesty—never vary.”
In Winners Never Cheat: Everyday Values We Learned as Children (But May Have Forgotten), his new book from Wharton School Publishing, Huntsman describes his ethical approach to business, while admonishing those who cut corners in pursuit of higher profits. Through candid anecdotes about his own life story, Huntsman shows the reader that integrity does pay and that “scammers, cheaters…and the like historically have never prevailed for long.”
Keep Your Word
According to Huntsman, today’s litigious business environment has created a lack of accountability among business leaders. He laments this state of affairs throughout his book, in such aphorisms as: “One’s word being one’s bond has been replaced with one’s word being subject to legal review.”
Huntsman’s view? “A handshake should always be as binding as a signed legal document.” And his own experience demonstrates that keeping one’s word can prove good for business, in addition to being the right thing to do.
For example, when Huntsman was working on his first big business deal with the Shell Oil Company in the early 1980s, he received a draft proposal from Peter De Leeuw, the company’s vice president, and signed it on the spot, without awaiting legal review. “My immediate signing and display of trust,” he recalls, “gave De Leeuw confidence that I was serious and paved the way for his help working out one glitch after another in the months to come.”
“The CEO is the one who takes the risk,” he concludes. ”If lawyers are allowed to decide all that, then they are the ones leading the company.”
When Huntsman sold 40% of his company to the Great Lakes Chemical Company in 1986, he faced a similar ethical decision. Although the agreed-upon price was $54 million, the sale’s value had appreciated to $250 million by the time the lawyers drafted the paperwork. Yet Huntsman did not press for the higher payoff: “He and I shook hands and made an agreement at $54 million…and that’s exactly the price at which the attorney would draft the document.
“Even though I could have forced Great Lakes to pay an extra $200 million, I never had to wrestle with my conscience or to look over my shoulder. My word was my bond.”
Play by the Rules
“Which rules we honor and which we ignore determine personal character,” Huntsman writes in his book’s third chapter, “Play by the Rules.” In business, he argues, one should never break the rules to gain an advantage.
Huntsman describes a deal that he made with Mitsubishi in the 1980s. The Thai government demanded that all companies working within the region give officials annual kickbacks “in order to be guaranteed access to the industrial sites.” When Huntsman Chemical refused to pay the fees, the company withdrew from its partnership with Mitsubishi, incurring a loss and forgoing a potentially profitable venture. However, Huntsman maintains that it was a wise move:
“Ethical decisions can be cumbersome and unprofitable in the near term, but after our refusal to pay ‘fees’ in Thailand became known, we never had a problem over bribes again in that part of the world. The word got out: Huntsman just says no.”
In the last 20 years, Huntsman and his wife Karen have put their principles into action by giving away more than a half a billion dollars to schools, cancer research, charities, libraries, scholarships, and the arts. Even when his company was losing significant amounts of money, he secured personal loans to meet his philanthropic obligations. “It's easy to say, sorry, I can't meet my pledge payments this year,” he says. “But, even when it's painful, one has to keep one's word.”
