by Tony Manwaring
There is something stirring, the sound of business leaders coming to terms with the new demands of leadership in the twenty-first century.
It is the recognition that business as usual cannot be the business model which delivers future success; that more of the same is not sufficient to provide escape velocity from the gravitational pull of the black hole that drew us into the credit crunch; that as fears of double-dip recession still haunt our nightmares, there must be new behaviours and new areas of strategic focus that need to be uppermost in the minds of business leaders, day by day.
This is what forceforgood.com is all about, so perhaps this is self-delusional wish fulfillment? After all, this web-site is rooted in the work of the inquiry team of business leaders looking into the future of Tomorrow’s Global Company. And it was Nandan Nilekani, co-founder of Infosys, who called on business leaders to ‘expand the space’.
Can I therefore enter into evidence the extraordinary contribution of seventeen leaders of some of the world’s largest financial institutions and others in their recent letter to the FT (September 28th 2010) – ‘Financial leaders pledge excellence and integrity’;
Sir, In the run-up to the recent crisis it must have seemed to the public at large that for many financial institutions the only arbiters of economic action were law and profit. If these were indeed the only arbiters of action, then there can be no lasting or effective response to what went before without the development and inculcation of a different and more enlightened culture; regulatory and fiscal actions alone will not suffice.
If the only question is, “Is it legal and profitable?”, then all that matters is that what is done complies with the regulations in force and makes a profit for the seller and the institution they represent.
At its most extreme this philosophy undermines any concern for the best interests of the customer, and subordinates these entirely to the pure self-interest of the seller in maximising profit as an end in itself. It legitimates exploitation and in the end subverts the very basis of trust in the market on which all profitable activity depends.
This letter was an important and deliberate intervention to support an important, perhaps even historic, event at Mansion House, in the very heart of the City of London, last week. Under the leadership of Lord Mayor Nick Anstee, who has spoken with great power and insight of the challenge facing the City of London in a speech “on the historical basis of ethics and corporate governance in the City” that certainly warrants reading.
The letter concludes:
Through work we all seek to realise ourselves as people, provide for our dependants and make a contribution to the social good achieved through collective endeavour. The recovery of a stronger sense of service through reinforcement of a culture of professionalism will both benefit the financial services industry and those who work in it as well as furthering the common good.
Ultimately, it is the responsibility of the leaders of financial institutions – not their regulators, shareholders or other stakeholders – to create, oversee and imbue their organisations with an enlightened culture based on professionalism and integrity.
As leaders of financial institutions we recognise and accept this personal responsibility. Ahead of next week’s Mansion House conference we therefore commit ourselves to do all we can to foster and encourage this culture both within our own institutions and more widely within the financial sector in the UK and elsewhere.
Well one letter does not yet a cultural revolution make, but few if any would have predicted such a statement of intent even months ago. There may well be many a slip between cut and lip, which is why it is welcome news – shared at the event – that the next Lord Mayor, Alderman Michael Bear, intends to pick up this baton, and bring together City leaders and others to discuss what needs to be done next, to practically support the actions and leadership that will translate these statements of intent into action.
Andrew Hill, reflecting on the conference in the FT, cited Marcus Agius, Barclays’ chairman, commenting that he had “hit the mark" when he said “myriad small services delivered to our customers’ satisfaction” would re-establish trust in banking. Combined with better communication of the benefits of banking and more thorough education of its practitioners, this is the long-term project” Hill concludes.
Hill then goes onto talk about the E-word: ethics. “More important is that the message of Monday’s ethics awareness course should percolate down to those who are either too busy or too junior to spend a morning in the opulent surroundings of the Lord Mayor’s City residence.”
As he notes: “The Mansion House debate sprang, in part, from a private seminar last year, led by Archbishop Vincent Nichols, at which top City business figures discussed the relevance of a papal encyclical on social teaching. Given that several participants lamented that there were no longer any commonly held precepts – religious or otherwise – to which business could adhere, it seems unwise to sideline the E-word this early in the City’s re-education”
Indeed, you could hear a pin-drop when Archbishop Nichols reflected on the crisis of confidence faced by the Catholic Church because of child abuse: That’s what sticks, that’s what you have to deal with,’ the archbishop said. It was a powerful intervention, but one which we lack the tools to engage with.
The case for but also difficulty of using the E-word is something I have blogged about already – acknowledging that there is a persuasive case to frame the argument around values and trust, whilst recognising that an understanding of ethics is needed to understand what is at the root of and drives behaviour and cultures.
The second and really rather superb source of evidence that something is in the tea that leaders are drinking nowadays comes from the wonderful Ray Anderson of Interface – addressing The Upper Chattahoochee River keepers.
Who they? Well in the words of their website: We co-founded the Upper Chattahoochee Riverkeeper organization in 1994 because of our great love for the river that sustained us in our childhood and now sustains our own children, as well as more than 3.5 million Georgians.
In his speech Ray draws on his experience of fighting cancer, to make the comparison with the ‘cancer’ attacking the earth “by homo sapien sapien – modern man, doubly aware man, man who knows and knows he knows – and who by now ought to know better”.
Ray states powerfully: “These are comments about the “cancer” that is attacking the earth, for lack of the right treatment. And what is that right treatment? I suggest the missing treatment is a genuine, enlightened sense of responsibility throughout the industrial system. And like human cancer, the earth’s cancer can take over our lives. What do I mean?”
Isn’t it interesting that two such powerful contributions – from Ray and the Archbishop – are borne from searing personal experience, deep conscience and the challenge of leadership that knows it must address the deep challenges facing their organisations, which they and their organisations have the capacity to address. (I really hope this is an appropriate comparison!)
Ray concludes;
“It’s high time to start the right treatment of this hateful cancer that is inflicted on the earth by us humans and our much lauded industrial system, before it takes us all down. It’s time for the public – the revered marketplace – you and me (we are part of the treatment) – to say to the institution of business: “You think you cannot afford to act responsibly; but here’s the truth: You can no longer afford not to act responsibly; stop your companies’ crimes against nature, for we, we (!) will run you out of business if you don’t.”
Powerful words indeed – the ethics of humanity’s relationship to nature and the nature of ethics speak to us with power and prescience. It is the sound of business leaders expanding the space.