The financial disaster of 2008 (and 2009…and 2010…) revealed the inevitable consequences of a world economy driven almost exclusively by self-interest. Business leaders and groups have responded by writing various codes of conduct to rebuild trust and prevent a recurrence. For example, The Oath Project was established last year to propose a universal professional code of conduct for managers. Its current draft has been endorsed by the United Nations Global Compact, the World Economic Forum’s Young Global Leaders, and the Aspen Institute.
However, despite these worthy efforts, much work remains to be done at a fundamental level. Even the co-founder of the Oath Project, Angel Cabrera admits: “Perhaps the message we have yet to convey in a compelling enough way is that a commitment to serve the public good not only benefits society but also is a vital element of effective leadership and a precondition for organizational success.” Writing on The Soul of Leadership in the Harvard Business Review’s “Imagining the Future of Leadership” series, Cabrera cites research showing that:CEOs who frame decisions in pure economic terms tend to be perceived as more autocratic and less visionary than leaders who express concern for a broader set of stakeholders through, for example, a commitment to public good. And the more visionary a leader is perceived to be, the more willing employees are to go the extra mile and consequently deliver higher performance.
Cabrera concludes:
To lead is to influence others without coercion. To follow is to take a leap of faith and put your future into someone else’s hands. Before taking this risk, followers seek out proof that a leader’s values are solid and compatible with their own. Above all, they look for evidence that a leader is not driven exclusively by self-interest and will take others into consideration when making decisions…In fact, it is followers’ perceptions of a leader’s “soul” that can make or break the deal. One of the greatest challenges of any corporate leader is to convince everyone else that they will not compromise the interest of the corporation, if not society, for their own benefit.