The Times: How to… be a responsible leader

The demand on business leaders is no longer ‘make money or else,’ social and ethical considerations are increasingly important

October 11, 2007
Emily Ford

Tell your employees to turn off their monitors, print fewer pages and arrange the odd company volunteering jaunt. If only being a responsible leader was that simple. In a climate of rising ethical expectations, sustainable business is not about token gestures – it is key to attracting the best talent, satisfying increasingly ethically aware customers and ensuring that you are still profitable in 20 years’ time. We asked three experts how to keep your leadership on the right rails.

1. Work out your values. Integrity starts with the individual; before you lead an organisation’s agenda, you need to be sure of your own. “People will look to the promises that you make [so] authenticity is crucial,” says Sandra Macleod, a lecturer on corporate social responsibility (CSR) and the chief executive of Echo Research, a reputation management consultancy.

2. Be consistent. “[Responsibility] has to be endemic throughout the organisation,” she says. This means applying the firm’s core values to everything from health and safety policies to employees’ work-life balance. “For a young business leader, CSR is not an additional thing, it’s absolutely ingrained,” she says.

3. Take on the triple bottom line. “You need to adopt a long-term perspective and think about three dimensions: social, environmental and financial,” says Professor Steve Downing, at Henley Management College. “Once you engage with [the triple bottom line] you will soon see areas to improve on, be they community issues, travel, energy use or packaging.”

4. Blaze a trail. “If you’re a responsible leader, your business is changing the organisation,” Professor Downing says. Innovators have to challenge the status quo, so don’t be discouraged if you don’t find instant support. “Don’t say ‘we’ve always done it this way’; say, ‘this is how we’re going to do it’,” says Matthew Gitsham, principal researcher at the Centre for Business and Society at Ashridge Business School.

5. See the bigger picture. Gitsham calls it systemic thinking. “Historically, managers were responsible for one set of targets. But now [they] need to see how a decision made in one area affects the rest of the organisation – and its reputation.” He cites Shell’s decision to dispose of the Brent Spar in the North Sea in the 1990s. “They had done research internally but not looked at how people would react to it or how it would influence consumers. No one predicted the fallout.”

6. Work with stakeholders. “Organisations are often accused of talking to themselves,” Gitsham says. Whether it’s employees, customers or local groups, outside opinions matter. “Instead of just making a decision and then defending it, engage in dialogue,” he says. Some firms invite NGOs and community groups to review company performance. “In the Eighties and Nineties [business] was all ‘me me me’,” Professor Downing says. “Now, it’s ‘we we we’.” On issues such as climate change or labour abuses, real progress will come from collaboration, he says. Macleod agrees. “This tide is greater than individual organisations.”

7. Embrace diversity. “Being inclusive is easy to say but hard to do,” Gitsham says. “Managers tend to latch on to what they know.” A truly diverse workplace goes beyond gender, race and disability, he says. “Equal opportunity [is] more than physical characteristics; it’s a willingness to bring in new perspectives.”

8. Be compassionate. People respond emotionally to business decisions, Gitsham says. Involve employees as much as possible and communicate difficult announcements such as redundancies sensitively. “We would normally term this the softer side, but it’s actually the hardest to manage and the most difficult if you get it wrong,” Macleod says.

9. Think globally, act locally. Corporations are notorious for taking actions in one region without thinking about the wider implications – and for making global decisions without thinking about how it affects those on the ground. “Before you place an ‘urgent’ order, think about whether people in a factory in China will have to work 14 hours a day to meet [that] demand,” Gitsham says.

10. Stay positive. Many people view sustainability as bad news. “They see it as giving up stuff. As a responsible leader you have to reframe that and explain that this is progress,” Professor Downing says.

http://www.timesonline.co.uk/tol/life_and_style/career_and_jobs/graduate_management/article2631058.ece

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