Original publication in weforum.org on December 2nd 2019
A. The purpose of a company is to engage all its stakeholders in shared and sustained value creation.
In creating such value, a company serves not only its shareholders, but all its stakeholders – employees, customers, suppliers, local communities and society at large. The best way to understand and harmonize the divergent interests of all stakeholders is through a shared commitment to policies and decisions that strengthen the long-term prosperity of a company.
i. A company serves its customers by providing a value proposition that best meets their needs. It accepts and supports fair competition and a level playing field. It has zero tolerance for corruption. It keeps the digital ecosystem in which it operates reliable and trustworthy. It makes customers fully aware of the functionality of its products and services, including adverse implications or negative externalities.
ii. A company treats its people with dignity and respect. It honours diversity and strives for continuous improvements in working conditions and employee well-being. In a world of rapid change, a company fosters continued employability through ongoing upskilling and reskilling.
iii. A company considers its suppliers as true partners in value creation. It provides a fair chance to new market entrants. It integrates respect for human rights into the entire supply chain.
iv. A company serves society at large through its activities, supports the communities in which it works, and pays its fair share of taxes. It ensures the safe, ethical and efficient use of data. It acts as a steward of the environmental and material universe for future generations. It consciously protects our biosphere and champions a circular, shared and regenerative economy. It continuously expands the frontiers of knowledge, innovation and technology to improve people’s well-being.
v. A company provides its shareholders with a return on investment that takes into account the incurred entrepreneurial risks and the need for continuous innovation and sustained investments. It responsibly manages near-term, medium-term and long-term value creation in pursuit of sustainable shareholder returns that do not sacrifice the future for the present.
B. A company is more than an economic unit generating wealth.
It fulfils human and societal aspirations as part of the broader social system. Performance must be measured not only on the return to shareholders, but also on how it achieves its environmental, social and good governance objectives. Executive remuneration should reflect stakeholder responsibility.
C. A company that has a multinational scope of activities,
not only serves all those stakeholders who are directly engaged, but acts itself as a stakeholder – together with governments and civil society – of our global future. Corporate global citizenship requires a company to harness its core competencies, its entrepreneurship, skills and relevant resources in collaborative efforts with other companies and stakeholders to improve the state of the world.
Written by Klaus Schwab Founder and Executive Chairman, World Economic Forum
Original publication in Forbes on October 31st 2019
As untamed capitalism and corporate greed come under increasingly fierce and widespread siege, the business world has begun to respond, loudly.
In August, the elite CEOs of the Business Roundtable lobbying group released a statement promising to move away from the decades-old corporate belief in “shareholder primacy” toward a more holistic, purpose-driven approach that “serves all Americans.”
Let’s be clear: this move is a huge milestone in the recent history of management. After all, the signers of this statement lead organizations that take in a combined $7 trillion in revenue and employ 15 million people. However, whether the group’s stated goal of shifting commitments actually transpires remains to be seen.
The advantage of purpose-driven companies
Still, the business roundtable’s announcement, while greeted excitedly, shouldn’t have come as a huge surprise. Over the 11 years since the start of the fiscal crisis, more and more attention has been paid to the ethical, social and environmental responsibilities of co~rporations.
Yet businesses that do operate with a sense of purpose and of bettering society reap economic benefits.Recent studieshave shown that the performance of companies with a clear sense of purpose grew by 10 times the median rate of companies on the S&P 500.
What’s more, purposeful organizations appeal to younger people just entering the workforce. This generation has grown up connected in unprecedented ways by technology to a global community, alert to what threatens it and attuned to social justice. To reach these new or future workers of the Greta Thunberg generation, companies can’t ignore social ethics.
How to promote purpose throughout your business
Purpose is a word that packs a punch. It’s an idea whose meaning, while lofty, may be easily grasped. But attaining a sense of purpose can prove daunting, especially in the context of business and its more practical economic goals.
This can be seen in the gap between society’s expectations of businesses and its perception of results: just 39% of people think that organizations work with the goal in mind of improving the quality of life and well-being of their employees and surrounding communities.
It was with this challenge in mind that I, along with my colleagues A. Lleo-de-Nalda, C. Rey, A. Alloza and N. Pitta, set out to research the promotion of purpose in business. And to develop what we call the Purpose Strength Model compiling the successful techniques and strategies drawn from analyses of 25 purposeful businesses.
How can CEOs and managers promote purposeful business? It’s helpful to first recognize the three pillars of purpose:
1) Coherence, or the alignment between what a company says and what it does.
2) Authenticity, or the true motivation and intention behind the things a company does.
3) Integrity, or the naturally occurring behaviors that help maintain a purposeful drive.
Then, it’s necessary to understand the first and most fundamental step toward building and sustaining purpose, which is constructing asharedpurpose that enters the minds and hearts ofallemployees and inspires them to do their best, most purposeful, work.
How exactly can this communal purpose be achieved? Our model presents four factors, or levers, to attend to while sowing purpose in your organization:
1.Strategy. The company should define a strategy for the development of a clearly defined purpose. This may sound simple, but it requires deep, prolonged reflection and understanding of corporate responsibility and ethical objectives. This strategy should include specific mile markers to be met along the road to purpose.
2.Leadership. Company leaders must be depended upon to capably transmit the company’s purpose to employees so that it enters their minds and hearts. This leadership includes directors who promote purpose from the top of the organization and, so that purpose permeates each employee, leaders at all levels and divisions of the company.
3.Management. Systems of management and organizational procedures that guide day-to-day work and ensure that purpose is remembered each day. The organizations we studied saw fit to integrate the company’s purpose into all daily aspects of work including budget planning, talent recruitment and performance assessments.
4.Clear communicationis paramount to demonstrating that what the organization is, what the organization says it wants to be, and what it is perceived to be, all align.
By following the model of companies who are ethically and financially successful, managers can help lead their companies into a thriving, purposeful future.
“Employee well-being ranks number one, because your organization is only as good as the people that you have working for you, and their well-being determines how successful or unsuccessful you’re going to be,” says one respondent, Michael Colucci, CEO of Idilus LLC, a professional employer organization.
A CEO from an engineering firm responds: “I don’t believe that customers should come first, I believe that employees should come first. It’s a tenant at my company. It is a cornerstone of my company to have happy well-adjusted employees.”
Well-being programs are also becoming table stakes to attract and retain talent, especially younger generations. One CEO says that “employee well-being programs are becoming more of an expectation rather than a perk.”
The importance of employee well-being also impacts the bottom line, the respondents add.
“If my employees are unhappy or they’re going through whatever stresses that they are encountering at home in their personal life, they bring that in,” another CEO says. “If you have a big team environment that we work in…it can cause absenteeism. People who aren’t focused at work, it creates delays with projects so things get backed up at work.”
The respondents are also candid about their own struggles with significant work stress, though many say they are successful in “compartmentalizing that anxiety” – and hiding any signs of it from employees because of the “contagious nature” of workplace stress. As a result, nearly all of the CEOs say they feel some form of isolation in the workforce, and they recognize that this is a concern for their own well-being and work.
But that masking may not really be working after all, some concede.
“I’m sure they feel it when I have stressful situations because I put that back on them,” one CEO says. “They can tell by your disposition, you create a level of anxiety within the team concept that we have at our place and that affects them adversely because it makes them feel anxious or unsure about what’s going on maybe, within the corporate structure.”
While a majority of the respondents measure the success of their well-being programs using metrics such as retention of employees, satisfaction in their role and employee engagement, most of the CEOs agree that a comprehensive employee well-being index would be helpful to measure the level of employee engagement within the programs.
“Employee wellness is increasingly critical to business success and at the top of the agenda for many CEOs and even board members,” says Paula Allen, Morneau Shepell’s vice president of research, analytics and innovation. “But executives still struggle with methods to properly execute and evaluate that support. LifeWorks is positioned to address these concerns.”
Originally published in Medium.com on October 1st 2019
In a recent meeting of the Business Roundtable, “the CEOs of nearly 200 companies just said shareholder value is no longer their main objective”. Given the dominant paradigms of endless growth and shareholder profit at any cost, the articulation of this sentiment from prime business circles is a shift indeed. Of course, it needs to be seen whether this is only talk or is it backed by commitment and intention. Nonetheless, it is proof that we have reached a point of stagnancy and exhaustion with our old models and structures. There is no further benefit to be gleaned from them. In fact, clinging to the old ways is now proving to be chaotic, cataclysmic, and even apocalyptic.
In a deeply complex, inter-related and interconnected world, every single thought we have, each decision and action we take has far-reaching impact — often beyond our ability to comprehend. And this is multiplied manifold when the actor is a large organization. Hence, it is time to change the underlying narratives, metaphors, and consciousness that are driving today’s organizations. This requires a complete reinvention and re-designing of the fundamental organizational principles, ethos, and purpose — the veryraison d’etre of organizationsmust shift. New strategies, technologies, and processes superficially affixed on top of the existing paradigms and worldviews will not work. The old debilitating and destructive patterns will creep in through the backdoor, under different names and guises.The shift from maximizing shareholder profit to the well-being of all calls for an awareness-based, conscious transformation toward building life-affirming, regenerative, and thrivable organizations.
In this post, I have attempted to explore some of the key dimensions and facets of theleadership questthat this shift is asking of us…
We are at a transformational moment in human history — on the cusp of a profound transition from an Industrial Growth Society (IGS) to a Life-Sustaining Society (LSS).The breakdowns on multiple fronts are heralding the destabilization of the old order. The system is literally self-terminating. And as Arundhuti Roy says so eloquently,“Another world is not only possible, she is on her way. On a quiet day, I can hear her breathing.”Joanna Macy calls itThe Great Turning.What we are collectively experiencing as decay and disintegration, disequilibrium and dissolution are the death throes of an old-world order.
In the face of this destabilization, our organizations and leadership must become amplifiers and compasses for another world — one which is built onthe principles of thrivabilityfor all and not only for a handful of the rich and powerful. Michelle Holliday describes “thrivability” thus:
In practice, thrivability is about identifying and committing to your organization’s own best means of enhancing life’s ability to thrive. And it’s about aligning with life’s core operating patterns across every aspect of the organization.
Is the idea far-fetched? I don’t think so. Is it necessary? I can think of no other purpose for the existence of an organization in today’s context. Will it be easy? Absolutely not. It will require each and every one of us to operate from and aspire to our highest selves, to reclaim our essential humanity lost to years of conditioning, and to push back against the forces doing their utmost to drag us backward. AsUmair Haquesays,
“Organizational leadership today means building an organization that is a model for the world it hopes to create. That models — demonstrates, displays, shows, exemplifies, for all to see — the better world that it hopes to spark.”
However, our current organizational paradigms and business models reward ruthlessness, aggression, cunning, competitiveness, authoritarianism, and an overarching “what’s in it for me” attitude. Unfortunately, these very traits strip us of our innate humanity and purpose, which are imbued with generosity, gratitude, compassion, courage, joy, love, and meaning. These qualities find little place in our organizations today — or lurk and hide in corners, afraid to reveal themselves for fear of ridicule, contempt, and condescension. This has created workplaces that are devoid of purpose, possibilities, and promise. People are literally ‘Dying for a Paycheck.’
Given this backdrop, I have used the phrase “leadership quest” deliberately. I believe leaders, and each one of us, have to “undertake a journey toward actualizing our highest future potential” in the service of a thrivable and regenerative world. And this quest will see an unfolding of pioneering and regenerative leadership principles and ethos necessary to build a life-sustaining society…. It is a quest, a journey of human evolution, a collective awakening of consciousness that is already taking place across the world in many shapes and forms.
We are at a unique stage in human history where technology and human consciousness are evolving and growing rapidly and exponentially. Their intersection — if put in the service of the well-being of all sentient beings and our Planet — can have an astounding impact. And our organizations can become platforms and holding spaces forThe More Beautiful World Our Hearts Know Is Possible. Wouldn’t that be a worthy quest for all?
Nurture imaginal cells. Underneath the chaos, disintegration, and disarray apparent across the board lies the DNA of a new order waiting to be manifested. And what is to be birthed bears no resemblance to the old. Just as the caterpillar bears no resemblance to the butterfly, and yet holds the key — the imaginal cells — for its own metamorphosis. In the same way, the key — the imaginal cells — of regenerative, anti-fragile, and thrivable organizations are hidden within this collapse and chaos.
They are to be found in the shapeshifters, the wayfinders, the edge-dwellers, and the norm-breakers within our organizations. These individuals bear the seeds of a different narrative and the visions for an emergent future which is life-sustaining. They carry the possibilities of breakthroughs amidst the breakdowns.Regenerative leadership calls for an ability to identify and nurture these imaginal cells within the organization, to support their endeavors, and protect them from the onslaught of the status quo.
These individuals will often come across as fearless and bold contrarians, and the natural tendency will be to resist and fight them, to try and eject them from the system, to sideline them. The dominant status quo can be a formidable force. And this is precisely where leadership comes in — it will be the job of leaders to nurture and protect these people, to ensure they can grow, connect, and collaborate till a tipping point is reached. Once these wayfinders form clusters, and clusters of clusters, we can be sure that we are on the brink of a transformation.
Goto the edge of the system. The explorations and experimentations typically take place at the edges of a system. The edge is an interesting place; its very fluidity fills it with possibilities. It is also where two or more ecosystems come in contact with each other and give rise to interesting phenomena, like the mangroves (where the sea meets the land). Similarly, the edges of an organization are where the seeds of its next stage of evolution can be found should the leaders care to look.
A leader’s task is to be a bridge between the edge and the center — not to diminish the burgeoning potentials of the edge but to infuse the center with its spirit, vision, and energy. As more and more edge practices find their way into the center, the old patterns embedded at the core start to loosen and dissolve. With the releasing of the old ways, new practices, mindsets, and beliefs take root, transforming the organization. As Bucky Fuller said,
“You never change things by fighting the existing reality. To change something, build a new model that makes the existing model obsolete.”
Recognize the power of intention. This is perhaps one of the most crucial aspects of regenerative leadership. A leader’s intention is the North Star that guides an organization towards becoming a regenerative business. It is about holding onto the vision of a life-affirming organization, and then putting it in practice. It involves not only recognizing that an organization is a living system but also following through with life-sustaining ways of being and doing. (I have been writing about these shifts in my earlier posts —Leading in Uncertain TimesandLeading in Uncertain Times: The Journey Within.)
No amount of re-engineering, reorganization, and re-training will work if the fundamental intentions and consciousness are still rooted in the past. In short, the foundations of a thrivable organization cannot be built on profit maximization. The inner conditions of leadership have a profound impact on the outer reality. Only when leaders stay steadfastly true to the purpose of the organization, uphold its capacity to be a regenerative and healing force, and take actions and decisions rooted in their intention, can they propel an organization to move to its next stage of evolution.
Create conditions for emergence. Emergence is a fundamental property of living systems as they adapt to their constantly changing environment. When we move from the metaphor of “organizations as machines” to that of “organizations as living systems,” it is easy to understand why creating conditions for emergence is important. Emergence in organizations takes place at the intersections of relationships — their divergence and their synergy. Synergy arises from maintaining and facilitating a fine balance between agency and symbiosis among diverse and different individuals for something fundamentally novel to arise. This means that diversity and inclusion are pre-conditions for emergence, and it behooves leaders to design for this.
One of the foundational qualities of regenerative leadership is then to create and safeguard an inclusive culture based on embracing widely divergent worldviews, perspectives, and even paradoxes.Holding space for emergence is an active process of staying in the liminal space, listening deeply, engaging all oursensemaking capacities, and staying open to the “magic in the middle.”Leaders who can lean into the emerging future are the ones who create magic in the face of chaos.
Go beyond collaboration. Collaboration has become an increasingly important aspect of 21st century’s boundaryless, distributed, and fluid workplaces. Individuals and teams collaborate across borders to pool expertise, accomplish a set of pre-defined goals, and share learnings. I am proposing that in the face of uncertainty and ambiguity, we need to movebeyond collaboration. Collaboration works when the path is known, an outcome is defined, and solutions are clear.
But when there is no path and outcomes cannot be predicted, then it is time to go beyond collaboration and embrace co-creation — a process of manifesting what is wanting to come through; giving shape to the emergent future by staying present, curious, compassionate, and courageous.Leaders need to become enablers and connectors — balancing divergence with synergy, facilitating the letting go off familiar outcomes, and holding the space for collective co-creation toward an ‘evolutionary purpose.’Thisact of collective sensemakingrequires deep trust in oneself, in the process, in human potential, and practice inPresencing. It should be a central part of today’s leadership quest to cultivate one’s capacities to create the conditions for co-creation.
Make life-affirming decisions. Organizations today can hardly be called life-affirming. They abide by and are driven by systems and policies that have turned them into profit-making machines at profound cost to their people and Planet. We are in the midst of a crisis that is beckoning us toward a different future possibility — one characterized by harmony, balance, resilience, and generativity. The purpose of the leadership quest today will be to make this potential a possibility. This will require leaders who are self-aware, mindful, and operate from a conscious understanding of the inter-connectedness and interbeing of everything. Without this felt sense of inter-relatedness, they will not be able to make life-affirming decisions.
The process is neither easy nor linear. It is an inner quest as well as an outer one. Leaders will be faced with infinite paradoxes and ambiguities, forces which will compel them to play by the old rules, and circumstances which will cloud their vision. However, by holding on to the overarching intention to be life-affirming, they can still act as stewards and facilitators of life. AsDaniel Christian Wahlsays in the context of regenerative leadership:
“Re-patterning the future regeneratively requires the transformation of the whole playing field, theredesign of our economic systemand ourmonetary system, and — ultimately — the collective redesign of the human presence and impact on Earth.”
In conclusion, I believe that we are at a point in our evolutionary history where we are collectively being called to listen to our deepest truths as human beings, as stewards of life, as imaginal cells of the future, and to direct our intentions, thoughts, and actions toward co-creating a life-sustaining society.
“Thrivability emerges from each of us holding the persistent intention to be generative: that is to say, to create more value than we consume.” ~Jean M. Russell
Publié dans le magazine HR Today- Alexia Michiels- Août 2019
Mettre en place une culture d’entreprise qui considère l’erreur comme une source d’innovation implique une posture managériale basée sur l’exemplarité, la confiance et l’acceptation de sa vulnérabilité. Une culture du feedback en continu est également décisive.
Why Millennial And Gen Z Employees Are Really Leaving You
When recruiting early career talent, many companies think installing a foosball table and stocking the breakroom fridge with beer is all you need.
What they didn’t expect was the fact that the Millennials and early Gen-Zers joining the workforce now have far more sophisticated needs and desires that won’t easily be swayed by an open office concept and free beer.
Unlike previous generations, Millennials and Gen-Zers are willing to leave their employers to find a company they feel aligns with their values and overall goals. And that’s a good thing: Gallup reports that about 33 percent of Americans are engaged at work. While ThriveMap found that nearly half of all employees have left jobs that didn’t meet their expectations, a whopping 73 percent of Gen Z employees did. Younger workers don’t accept mediocrity, and that’s good for your business.
But how can you keep those early-stage employees with high standards? Here are three tips to help retain early career talent:
1. Rewrite your job descriptions.
According to Amanda Hammett, a global Millennial expert, the No. 1 thing that drives young employees to quit is a lack of trust. Young employees expect the job descriptions they applied, interviewed and were hired for to match the roles they’re carrying out on a daily basis. However, in many situations, that’s not the case, leaving young employees to feel duped from Day 1.
“When Millennials and Gen Z employees feel they cannot trust what they have been told by their employer, the countdown is on until there are gone,” Hammett says. She’s found that many companies are depending on HR to write job descriptions for roles for which they know very little about the day-to-day intricacies. She suggests companies have their rock star employees in each role collaborate with HR to offer a more accurate view of each position to help curb future turnover.
2. Remember that employees are human.
Neuroscientist Matthew Lieberman suggests that the human need to connect sociallyis as basic as the need for food, water, and shelter. Regardless of the technology surrounding them at every moment — or the label foisted upon them — Millennials and Gen-Zers are human, which means they’re hardwired (like the rest of us) to crave personal connections. They want to know what’s going on in your life, and they want you to know about theirs.
This doesn’t mean you need to spend hours scrolling their Instagram feeds over the weekend. But it does mean having conversations in the office about things other than the latest project or report due. Learning about who they are outside the office shows them you care about them as individuals, and it helps you, too. You can more easily pinpoint the right person for a particular project, opportunity, or mentor based on what you know about your team members’ goals. When Millennial and Gen Z employees feel they’re seen as more than a number and developed, they’re far more likely to develop a stronger bond with you and the rest of the team, which can typically translates to a longer tenure with your company.
3. Accept that you’ll have continuous challenges.
The 2018 Deloitte Millennial Survey found that 43% of Millennials and 61% of Gen-Zers plan to leave their current job in the next two years. In order to save yourself and your company a tremendous amount of chaos due to turnover and hiring replacements, have conversations with your early career talent about what kind of skills they’re looking to develop. See if there’s some alignment in your own needs or the needs of another leader within your company.
Delanie Olsen, a marketing specialist at an events company in Chicago, mentioned in a conversation with her boss that she’d like to learn about SEO. A week later, her boss approached her about a class that would require Delanie to be out of the office for a full day. Delanie’s boss thought the SEO class would be a good investment of company time, however, to develop Delanie and her skill set — despite the fact that it didn’t perfectly align with her current role. This one act by her boss dramatically increased Delanie’s loyalty to her company and to her boss because it showed a desire to continually challenge Delanie, as well as further Delanie’s skills as a future asset to the company.
Millennials and Gen Z employees aren’t aliens from another planet. In fact, in most ways, they’re just like every other generation that came before. I recently read a book called Marketing to Gen Z that really helped me think about how I’m engaging the younger generations. I strongly encourage others to consistently educate themselves on how to understand different generations. Changing how you manage early career talent can ensure they not only stay, but also add value for years to come.