Monday 21 Jul 2014
Hands-on learning opportunities create more responsible business leaders
This is one of the key insights from a new research study that set out to discover why some business leaders put creating value for wider society at the heart of their work, while, at the same time, stories of corporate failures attributed to poor leadership abound.
The study analysed Business in the Community's pioneering Prince's Seeing is Believing programme, where chief executives are taken out of their comfort zones and exposed to the harsh realities of issues such as homelessness, alcoholism or youth unemployment.
Leaders are encouraged to roll up their sleeves and really see the negative socio-economic impacts of a preoccupation with profit – while also offering executives first-hand experience of the positive impact that business can have on lives.
Since 1990 the programme has involved 8,000 UK chief executives including bosses from Costain, KPMG, Greggs, Fujitsu, Barclays and Thames Water, who then feedback to HRH The Prince of Wales on the collaborative action they've taken as a result of their visits.
Mike Wareing, former CEO of KPMG, acknowledges that at the start of his career the responsible business agenda was not on his mind at all and he viewed having a social conscience, as a “personal thing” rather than something to be expressed in the business environment.
His change of attitude took the shape over a period of time and came to a head during a chance encounter on the streets of London.
He recounts: “I was in my very nice, quite large, chauffeur-driven car in London…as I was sat there I looked out of the side window and there was a young girl sat in the corner, absolutely white as a sheet, with a blanket over her. It looked very much like she’d got a major drug problem. She looked at me and I looked at her and – I though ‘well… here I am, in my nice car in my nice suit with somebody driving me and all the rest of it and there’s she a few yards away, early in her life and’ – the gulf between us was just extraordinary.”
As a result of this encounter, Wareing resolved that he should take action, and he was invited to attend a Seeing is Believing visit on this particular social issue. Although it was quite shocking, it helped him realise the skills and experience he had developed in the business world could be used to make a difference. He has since established a long-term commitment for KPMG on tackling homelessness.
John Varley, former chief executive of Barclays Group, chairman of Marie Curie and non-executive director to the boards of Rio Tinto and AstraZeneca, has always had a strong sense of values, ethics and social consciousness. But early in his career he held the view that the main contribution business can make to society is through maximising profit, generating wealth, creating jobs and delivering goods and services.
One of the things that makes the Seeing is Believing visits he has subsequently led so powerful is meeting people who are experiencing these challenges first-hand. “What I think the Seeing is Believing visit does, is take you beyond concept into reality,” he says. “We can all conceptualise a homeless person who needs help. But we’re standing back from it and we’ve not crossed into their space.”
Varley acted on this shift in perspective by taking a leadership role in a number of collaborative multi-stakeholder initiatives. He became president of the UK drugs policy commission, for example, and chairman of a gay and lesbian community group in the East End – both actions that would previously have been outside his comfort zone, had it not been for these experiences.
The BITC and Ashridge Business School research report Developing Responsible Business Leaders suggests that developing leaders who are powerful sources for social good depends on exposure to influential role models and support networks of like-minded leaders.
It also highlights the actions that can be taken to create ethical organisational cultures, including:
· Leading by example - Senior leaders must champion responsible business leadership on public platforms, in conversations with peers and through the goals they set, the stories they tell, the shadow they cast and who they celebrate and reward.
· Recruiting the right people - Talent management and recruitment processes need to value different qualities and life experiences that make a crucial contribution to developing the right worldview, such as volunteering.
· Development opportunities- Leaders and HR professionals should embed experiential learning into their organisation’s leadership development activities to improve workplace performance.
Thirty years ago there was very little discussion around corporate sustainability – people expected issues to be resolved through public policy interventions. Times have changed, and sustainable business practices are something every leader needs to understand.
Sustainable business success will not be found in leadership models that champion shareholder value above all else. Developing professionals who understand the critical importance of responsible practice needs to be at the core of everything that businesses do.
Matt Gitsham is director of the Centre for Business and Sustainability and Lee Waller is director of the Centre for Research in Executive Development – both Ashridge Business School