Successful, modern leadership should be shaped by a legacy that reflects the leader's substance and passion. Charlie Wagstaff, managing director of Criticaleye, explains how this can be achieved.
With reputations increasingly under the global spotlight, modern CEOs must consider whether their legacy is both authentic and enduring, or risk being unmasked as an imposter. In the end, a long hard look at your organisation will tell you whether your leadership style has been consistent with who you are and your own DNA.
The evolution of a leader's legacy needs to be addressed because there are many urgent socio-economic shifts that will continue to challenge the way leaders will need to act.
Consumer awareness: savvy consumers will no longer be readily taken in by superficial brand positioning or public relations initiatives.
Take BP. The Gulf of Mexico spill in 2010 was always going to be a serious crisis for the company. What doubtlessly exacerbated the feeling against BP was their overt 'nice' image - when you change your logo to a flower, you give a clear impression of your stated intentions as a 'green' company.
Now take Toyota. In the era of online social media, where the public has so much access to information and can share it and comment on it so rapidly, consumers punish those businesses that don't live up to expectations. Toyota's disaster was not so much the accelerator issue but rather the perceived culture of denial and desire to sweep the issue under the carpet.
Companies must demonstrate sheer transparency, authenticity and speed, all qualities that BP and Toyota had seemingly lacked. Wrapped up in this is 'worth' - and its monetary relationship.
The unravelling and subsequent bailout of the banking financial system, for example, has meant that financial institutions in particular are experiencing tighter regulations.
Global business and communities: global business has the power of choice; it can largely choose to ignore the interests and concerns of others, or it can recognise them and discover new means of creating value, while simultaneously serving its own interests.
Arguably the influence of global corporations has shifted power away from local communities to distant boardrooms. Not only do these organisations have the ability to undermine the will of elected local and regional governments, but also those of powerful states.
With this have come the destruction of local environments, and the erosion of distinct national cultures. Equally, global business can be perceived to play developed and developing countries off against each other, to secure better short-term conditions for investment in developing countries through lower environmental or labour standards, taxation and regulation.
To overcome such short-termism, you must ensure that good corporate citizenship is built into all aspects of the business. Furthermore, all parts of the business must exchange ways in which good practice can enhance all of the objectives, for the medium- to long-term benefits of every stakeholder.
Generation engagement: As we move through life, each generation becomes 'smarter': more technically adept, with greater expectations, more worldly and eager to push the barrier ever further.
To engage successfully, keeping up with current trends and technology is a must. Social networking, blogging, podcasting or sending tweets is now the norm. If you want to be an effective leader, you must be willing to use the most current tools to your and your organisation's advantage.
While the older generation is largely still running companies, the younger, for many organisations, is their best chance of ensuring it can understand and respond to its customers and continue to have a legacy. These individuals are the 'natives' of the digital world and networks are in their DNA.
Reputation and culture: With a greater global spotlight on the reputation of organisations, companies are considered responsible for their own actions as well as those of their suppliers and all those it interacts with or impacts.
Their ability to cope with this responsibility is tested daily; wishful thinking, naivety, and even standards of legal practice can all lead to good intentions going awry.
The majority of companies intend to operate at the highest standards of integrity. Most have strong ethical guidelines for themselves and their suppliers. Many of these are written into contracts. There is though a reliance on written standards of conduct rather than a focus on the conduct itself.
Standards of conduct are there to protect you legally, and almost never control behaviour, unless they are quite specific and are enforced and believed by those who implement them. The culture of the organisation dictates the behaviour, and this is ultimately set by the leaders.
The buck stops with you
Above all, a strong and clearly understood ethical conscience needs to exist across the entire organisation, from top to bottom. Leaders must continually set the framework for this standard and act in a manner consistent, not only with policies and practices, but also according to a strong personal value system. Each stakeholder needs to be able to challenge the other without fear of the consequences.
Self-reporting is one of the best ways of ensuring that you and your suppliers engage in actions that truly reflect the behaviours your ethics promise. It helps you to scour your world for adherence in the same way that a successful consumer company continually 'mystery shops' itself. It puts into place consistent measurement and communication that lets constituencies know what standards you expect, how you will maintain performance and that you will point out ineffective action when you find it.
Arguably the most significant contributions leaders are required to make are not therefore to the bottom line but to the long-term sustainability of individuals, communities and institutions that can adapt, prosper and grow.
To achieve this, as a CEO you should acknowledge that you are the value leader - and be passionate about it. It's your role to communicate the overarching purpose and framework that is underpinned by a set of shared values. You should reflect those values.
Secondly, you should create safe environments for sharing and ensure that you, as the leader, are approachable. You must understand the business ecosystem and be outward looking; create a vision-driven team and help them see the organisation's potential. Part of this can be done by incentivising your top team to achieve long-term issues - it will filter down.
Ultimately, you should always challenge what success looks like, at every turn.
Ensure the success of those around you, too, by planning and training successors and by positioning others to succeed - don't build more followers, build more leaders.
Be the change you seek
When evaluating your legacy, consider that people tend to follow brands and leaders based on whether or not they relate to and respect their values. Ultimately, you should ask yourself: Are my values aligned with the values of the organisation? Am I respected? Am I proud of the people, brand and motivations that I have strived to create?
I would challenge leaders to answer those questions by testing whether they are genuinely transparent, energised and confident in their conviction.
Your leadership style must be consistent with who you are, which means being authentic. Perhaps you seek to embed in your organisation a purpose beyond profit? Whatever your legacy, you should act in a manner consistent with a strong personal values system and ensure that this is understood and evident across the entire organisation.
As Gandhi said, "Be the change you seek." You should understand what it is that you are passionate about because, to be successful as a leader, you can only lead from the 'heart'. After all, when you look at your organisation, you are really looking at a reflection of yourself.