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Creating more responsible business leaders

Posted on from Ashridge Executive Education

Why are some business leaders now creating value for wider society at the heart of their work? A new report by Ashridge Business School suggests that exposing executives to stark social realities is key. Lee Waller and Matt Gitsham explain.

Creating ethical leadership

On Business in the Community’s The Prince’s Seeing is Believing programme, leaders witness at first-hand the shocking, negative socio-economic impact of a preoccupation with profit. They also experience the positive impact that business can have on the lives of vulnerable people.

Since starting in 1990, the programme has taken 8,000 chief executives on visits across the UK to see and experience issues such as homelessness, alcoholism or youth unemployment. Those taking part, who have included bosses from Costain, KPMG, Greggs, Fujitsu, Barclays and Thames Water, feed back to HRH The Prince of Wales on the collaborative action they have taken.

In its Developing Responsible Business Leaders report, Ashridge Business School interviewed some of the programme’s participants. Researchers asked them about their early careers, role models, influencers and defining experiences to reveal how direct engagement with social issues has kick-started their drive to embed responsible business practice.

Participants’ stories

Mike Wareing, former chief executive of KPMG International, acknowledges that at the start of his career the responsible business agenda was not on his radar. He viewed having a social consciousness as a “personal thing” rather than something to be expressed in the business environment. His growing awareness of social injustice was brought to a head during a chance encounter in London. Wareing recounts: “I was looking out of the window of my large, chauffeur-driven car and saw a young girl, absolutely white as a sheet. It seemed she had a major drug problem. The gulf between us was just extraordinary.”

Mike resolved to take action and attended a Seeing is Believing visit. “I was extremely encouraged and motivated by it,” he says. “Some of the help you can give is very relevant to your skills and experiences from the business world.” Later he established long-term commitment on the homelessness agenda within KPMG.

Early in his career, John Varley, former chief executive, Barclays Group, had a strong sense of values, ethics and social consciousness. However, he believed that the main contribution business could make to society is through maximising profit, generating wealth, creating jobs and delivering goods and services. Varley experienced a shift in perspective during the programme, which led to him becoming president of the UK Drug Policy Commission.

For Duncan Tait, chief executive, Fujitsu, working in his parents’ newsagents as a child and watching their customer service gave him insights into the role of business in society. Tait led a Seeing is Believing visit that enabled him to clearly define the business case for responsible behaviour – leading him to deploy his own employees into deprived areas. 

Working towards sustainable business

Until recently, there was little discussion around corporate sustainability, with people expecting issues to be resolved through public policy interventions. Times have changed, and sustainable business practices are something every business leader needs to understand.

Sustainable business success will not be found in leadership models that champion shareholder value as the key value. Creating professionals who understand the critical importance of responsible practice needs to be at the core of everything that businesses do.

Top tips for leaders

How can you create an ethical organisational culture?

1. Lead by example. Champion responsible business leadership on public platforms, in conversations with peers, the goals you set, the stories you tell and who you celebrate/reward.

2. Recruit the right people. Adopt talent management and recruitment processes that value qualities and life experiences, such as volunteering, that help develop the right worldview.

3. Develop opportunities. Embed opportunities to experience social realities into learning and development activities.

4. Build a critical mass. Encourage collaboration around social issues, within and across organisations. This helps promote wider awareness, understanding and a critical mass of people who can make an impact.

5. Demonstrate business value. Help your organisation understand that responsible leadership boosts the bottom line, helping to attract and retain the right talent, build customer loyalty and win more business.

Matt Gitsham

matt gitshamDirector, Centre for Business and Sustainability

Matt undertakes research on leadership, organisational change, leadership development and sustainability.

Ashridge Executive Education

Ashridge Executive Education

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