Articles

Leadership for Sustainability - Richard Little

The narrow scientific rationalism that brought us mass production, market economics and global warming also gave us scientific management. Notwithstanding decades of rhetoric about empowerment and engagement, corporations are still dominated by crude instrumental managerialism – the reduction of human beings, born free, to the status of expendable resources. Until there is a significant change in the practice of leadership in business, and in the legal framework that shapes current corporate structure and purpose, the transition to truly sustainable business will be half-hearted, faltering and fatally slow.

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A few years into the new century and there seems to have been a general shift, one long awaited by some, in the way people think of the earth, its diminishing resources and the likely consequences for future generations of the West’s way of life. And yet, there doesn’t seem to be much let-up in the cacophony of consumerism or the primitive drive for growth. You can still read huge chunks of the business press without finding a word about social justice or sustainability; the global business default is still growth at all costs.

Business is between a rock and hard place. Something has to give before the order of change matches the urgency of the threat and that something, I believe, is the most fundamental characteristic of the corporation: its leadership, with the political structure and legal apparatus that legitimises it.

In the twentieth century we saw both the triumph of science and its total failure. Science, with technology on its heels, brought miracles and yet, as Theodor Adorno and Max Horkheimer wrote in their Dialectic of Enlightenment, the earth ‘radiates disaster triumphant’ (Adorno & Horkheimer, 1944). The project of the enlightenment: the domination of nature by reason; the liberation of humanity from superstition and want, had, they wrote, brought in its wake totalitarianism, consumerism and the domination of a narrow form of rationality. Sixty years later the project is still in full swing. Only the other day I caught a scientist explaining on the radio that we are going to solve the problem of the earth’s limited resources by heading off to another planet (1). Of course, with fuel at a fiver a gallon, taking the family to Mars is not currently affordable. Another has just published his claim that ‘within the next few decades, many people will be falling in love with robots, having sex with robots, and even marrying robots’ (Levy, 2008). So long as apparently sane people can come up with this kind of near-demented fantasy, we are still stuck in the C20th, we are still living through the triumph and the disaster. Centuries, like decades, do not necessarily start or finish on time and this one is in full swing.

Horkheimer’s student, Jurgen Habermas, borrowing Husserl’s term lifeworld – the realm of natural human solidarity, inter-subjectivity and domesticity, contrasted it with what he called system, the realm of scientism, rationality and control (Habermas, 1984). System constantly colonises lifeworld; lifeworld constantly resists. Management, in the broadest sense of the word, is the everyday agent of this colonisation. Management not just in organisations but management that constantly seeks to extend itself into every nook and cranny of ordinary life, assisted by ever more comprehensive technologies of surveillance. Management seeks the perfection of rational instrumentalism, the most efficient deployment and control of the human animal. In the business organisation it seeks profit above all and, by and large, it does so with the full sanction of the law.

The C20th was, is, the century of scientific management. In 1799 Robert Owen, made a first stab at it with his Silent Monitor but it was Frederick Winslow Taylor who really got things going at the end of the C19th when he noted that, by means of systematic observation and analysis, work could be systematised and human impulses, even pride in work, could be subjugated to efficiency and wealth-creation. Significantly, nobody has ever seemed to want to apply his invention - scientific management - to stockbrokers or Chief Executives. At about the same time, Henri Fayol was inventing the structure of controls that we now call management hierarchy. Taylor and Fayols’ inventions were soon followed by Henry Ford’s mass production methods and the combination has never looked back – business-process-reengineering, just-in-time, lean manufacturing – all pure scientific management. Produce more for less, optimise labour, get people to be as much as possible like machines.

People do not like to be treated as machines. It wasn’t long before a keen-eyed management consultant, Elton Mayo, noticed that people at Western Electric’s Hawthorne works in Chicago seemed to be more productive when they were allowed some discretion. It was 1930 and the human relations movement was born, but somehow even that turned into the euphemism machine that has given us human resources, human capital, hi-pos and, the most shameful corruption of what is best about people, talent, as in warfertalent.

The tension between the emancipatory impulse and command-and-control became intolerable. Release came in the 80s when, apparently overnight, there was a wholesale shift in rhetoric. With a bit of badge-engineering, management became leadership, a word that brought with it endless pleonastic possibilities, as in inspirational leadership, or principled leadership (anyone for unprincipled leadership?) Part responsibility for this lies with Abraham Zaleznik. In a seminal article in HBR he portrayed management unflatteringly as the routine stuff of getting the widgets out on time and contrasted it with leadership – all about passion and authenticity and having visions (Zaleznik 1977).

Twenty years later and leadership was whatever a handful of elderly, wasp CEOs said it was, pre-eminent amongst them Jack Welch. It came down to: be a winner, motivate your people, liberate your people, listen to your people, have visions, be real, not just real – really real. Be really, really real. Really - that’s it, that was the theory. The practice, on the other hand, was dehumanising business-as-usual. A clue to what was going on here lies in the ubiquitous phrase ‘your people’, as in ‘harness your people for competitive advantage’ (Kotelnikov, 2008). Whose people? The whole literature is addressed to putative people-who-have-people. In this world yourpeople are always to be empowered and engaged. If yourpeople show signs of flagging, try this:

“Make sure everyone understands why all the effort is needed … make it crystal clear why teamwork is vital. Make sure each team has a clear sense of purpose and everyone understands how that purpose fits in to the strategy. Praise teams … so that everyone has a chance to shine. Let them have fun! The occasionally purely social or fun time does wonders for morale.” Simon Hollington: How to Build an Effective Team, People Management, June 2007

Managerialism seems like the purest common sense. But, half-hidden in all such texts is the assumption that yourpeople are not fully human, not truly self-determining. Managers, on the other hand – the you to whom such texts are addressed – managers are always engaged, always crystal clear.

An advert from the late 90s for a well known financial institution in the UK perfectly catches the tone of this profoundly patronising leadership with phrases such as “An extraordinary current account. An extraordinary star”. Its true. Our people are extraordinary. When we asked for a volunteer to appear in our new TV commercial a staggering 750 hopefuls applied and auditioned. And they blew us away with their talents…etc, etc”

Consider for a moment who is blown away by what, and why they are staggered. And just what do they mean by ‘extraordinary’. It couldn’t be ‘ordinary’ could it? This discourse is still to be heard everywhere; the century of managerialism is still in full swing.

Meanwhile, everything is falling apart. The multiple threats facing humanity have been sorted into three handy realms by Paul Raskin of the Stockholm Environmental Institute: environmental, social and geo-economic. In the environmental realm they comprise an unprecedented aggregation of disturbances to natural systems. Global warming, increasing number and severity of storms, desertification, rising sea level, loss of biodiversity, species extinctions and degradation of eco-systems, loss of fresh water. Each of these is ominous enough on its own, taken together they are likely to combine and amplify one another in ways we cannot possibly predict. In the social realm, global inequality and injustice produce unrest, terrorism, population pressure and migration. Geo-economic threats include the growing instability of closely-coupled capital markets and the increasing danger of global economic collapse. (Raskin, 2006).

All of these forces bear down heaviest on those who have least: for the poorest 2.5 billion, even a small increase in the cost of food, health or housing can be catastrophic. Despite an increasingly globalised economy, international politics is still driven by narrow national interests and inequitable trade arrangements. Fundamentalist reactions against the rich nations in general and an American hegemony in particular are fuelled by failures of education, diplomacy, inter-governmental regulation and dialogue.

Above all these stands the single fact of the accelerating depletion of natural resources – the Earth’s carrying capacity. Thirty years after Schumacher described them as irreplaceable capital, they are still being drawn upon as if they were inexhaustible. Demand for dwindling resources is driven by a world population that has doubled in the last 30 years and by the dramatic growth of middle classes in China and India. In the case of oil, the world faces the inevitable consequences of dramatic increase in the cost of liquid fuels (and following that, of gas) caused by increasing demand and slowing production. A developed world that cannot afford oil may become more sustainable perforce, or it may fall into a chaos that makes co-ordinated adaptation impossible.

These are daunting challenges, but even these are only symptoms of a deeper malaise. They are the products of a Western culture fixated on growth, wealth and consumption. And that in turn, is the consequence of the four-hundred year long religious and then scientific project to dominate nature, to place humanity at the pinnacle of creation, to assume the inexhaustibility of natural resources and to secure perpetual improvement in the human lot. The same project that gave us scientific management and its correlate of insatiable consumption and wearying anomie. You can never get enough of what you don’t need. (Edmunds, 2005).

If business is going to play its part in making a sustainable world, it will need leadership and management, but if leadership continues to be the operational wing of enlightenment reason, authorised by reductionist rationality, assuming entitlement to power, arrogating the right to patronise yourpeople, it will only displace the problem, it will co-opt the idea of sustainability and turn it into another department, another profit-centre, another brand-value. It is happening already, everywhere. Herbert Marcuse described what he called the self-inoculation of an institution against unwelcome critique and change, when it accepts just so much blame and makes just so much penance as is necessary to satisfy its critics – then goes on as before: in this case exploiting, polluting, corrupting.

If the over-running C20th is to close, and the century of transformation is to begin, business leadership has to change.

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Thinking about leadership is apt to be coloured by a Hobbesian failure of faith in democracy, in collective reasoning and decision. Groups are all very well, says the voice of doubt, but they usually need someone to give them a little push, someone primus inter pares to cut through the waffle and the nit-picking. ‘Usually’ shades into ‘always’ and the emergent figure hardens into a heroic permanency: the leader. The idea of this leader, embodying rationality, fairness, courage and a thousand other virtues, most of them implicitly masculine, exerts huge gravitational pull on thinking about leadership. Post-heroic or emergent or democratic models of leadership are launched, but they cannot achieve escape velocity. They are dragged back by the gigantic planet of common-sense pessimism and the craving for certainty. Feeling and emotion fall back to earth as ‘emotionally-intelligent leadership’. Likewise spirituality: ‘spiritual intelligence’, according to Robert Emmons, is “the adaptive use of spiritual information to facilitate everyday problem solving and goal attainment” (Emmons, 1999). Whatever is meant by spiritual information, it is turned here to distinctly rational-sounding ends. Post-heroic leadership scarcely gets off the ground. When Jim Collins tells us that real leaders are humble, even their humility becomes heroic and extraordinary: “(they) possess a paradoxical mixture of personal humility and professional will. They are timid and ferocious, shy and fearless” (Collins, 2001). Practically every new perspective on leadership turns out to be an expression of the same old need to be rescued from the terrors of collectivity and co-creation.

What would leadership be like if we really believed in the capacity of people to decide things for themselves, not by crude voting mechanisms, but by thoughtful, critical and skilful dialogue? Leadership would be a form of action, occasional and transient and subject always to the test of its legitimacy: does this act improve or impair our democratic capacity? Acts of leadership would be those interventions, by whomsoever whenever, that best facilitated the powers, the imagination and creativity of - everybody.

If leadership is to change, leadership development must change: something that is readily in our powers. In 2005, the European Federation for Management Development called on business schools to refocus on globally responsible leadership.

“The challenges facing humankind are large, undeniable and global. Economic, social, environmental inequalities abound and are increasing. Businesses are among the most influential institutions worldwide. They have a tremendous opportunity to shape a better world for existing and future generations. Business schools and centres for leadership learning can play a pivotal role, alongside business, in developing the present and future leaders required to ensure that business is a force for good.” EFMD (2005) A Call for Engagement

Since then, despite an explosion in new institutions, courses and course modules that focus on sustainability for business leaders, the fundamental assumptions that lie behind leadership and management development have remained the same. I heard the vice-chancellor of an ancient university say recently that she must develop senior academics who could ‘embed the vision’ and who would ‘mould the people’ in the shape of a new ‘entrepreneurial culture’. ‘God knows’, she continued, ‘we’ve got a compelling story to tell’. You can hear the same thing in any boardroom. Its yourpeople again; waiting patiently for someone strong enough, with a vision compelling enough to save them from their helplessness.

John Clancy, writing in 1989, suggested that, given the purpose of modern business, a dehumanising, mechanistic model of leadership was unavoidable. That purpose was, is, to make profit, and more of it than last year. Business, he said, was ‘le voyage sans but’, the aimless journey. Its purpose should be generative not of profit, which is a means to no definite end, but of material, ethical and spiritual excellence. Human beings, he wrote, are “… unfathomable, irreplaceable, unique; every human being is sui generis; attempts to mould him (sic), rationalise him … will never succeed” (Clancy, 1989) - and their crude domination by rational management is a continuing global crime.

If Clancy is right, there has to be a deeper change, one without which a transformation in the nature of leadership is at best pointless, at worst impossible: a change in the fundamental purpose of business. Such a proposition brings us full circle: if business and economic growth are to be sustainable, we must have a new kind of leadership: dialogical, democratic, fully informed, environmentally, ethically, politically and disconnected from fantasies of individual potency. For that to stick, there must first be an end to narrow, pointless wealth-creation for its own sake: enough is enough. But what conceivable hope can there be of so dramatic a change of heart? There is hope, and it lives in a tiny, obscure American state called Delaware.

The purpose of business, or at least of the Anglo-American corporation, is defined by the laws of Delaware, which happens to be the state in which most big corporations are registered. They are framed in such a way that, for instance, a corporation may not take action to reduce its environmental impact unless it can be shown that by doing so it will increase profits. In this respect the law believes that shareholders’ interests trump all others. You or I might say that this proves that the law is an ass, at least the law of Delaware. To others, presumably including shareholders, this principle is self-evidently true and good, it has “irresistible intuitive appeal” (DeMott, 1985). There is a sense in which we are all shareholders, but whatever benefit trickles down to people of ordinary wealth must be set against the shared cost to society of corporate externalities. And the fate and wealth of the vast majority remain utterly untouched – failed by corporations, by markets, by selfishness and the peculiar law of the state of Delaware.

A lawyer from Boston, Kent Greenfield, argues that corporate law should encourage the corporation to create wealth, but for the whole community rather than for a ‘supreme stakeholder’ and to do so without imposing ‘costly externalities’ (2) on the commonwealth (Greenfield, 1998). In a simpler form, his argument, that the business of business should be to create true wealth for all, universal equity without further diminishing amenity, resources, the planet that is our only home (whatever Mr. Griffin may say). Greenfield is not alone. Many people of good will in business know that what seems like a license to make money is actually a profound limit on their freedom of action; they would rather make honourable profits and survive the coming storm.

A change in corporate law is a necessary but not a sufficient condition for the transformation to sustainable business. In any case, it may take a while. In the meantime we must encourage the other necessary conditions: leadership development based on action rather than personality and organisation development predicated on the capacity of an organisation’s membership, a capacity enhanced by skill in dialogue, to create new social capital, products and services that don’t ‘cost the earth’, authentic ways of working that bring about energy and joy.

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How? It’s easy. At Impact we are doing it every day. But right now I need a drink.

© Richard Little, June 2008

Richard is a consultant and teacher. He has worked for Impact International for twenty-five years. His consulting purpose is to change the way people understand and practice organisational leadership for sustainability, with clients worldwide in business, in the public and voluntary sectors, in universities, in transition towns. Current clients range from the boards of global corporations to Grasmere Village Hall Committee. He believes that organisational and social justice – preconditions for true sustainability – call for leadership that is inclusive, open, collegiate and dialogical.

After expulsion from school in the ‘60s he worked in the theatre, first as an ASM in rep, then torturing audiences with his own and other small theatre companies until he got a proper job in 1982, after which he could eat when he liked.

He teaches on post-graduate courses in experiential education at the University of Cumbria. Right now he is designing a forthcoming MA in Leadership for Sustainable Development.

References and notes

Clancy, J. (1989) The Invisible Powers: The Language of Business.

Collins, Jim (2001) Level Five Leadership. Harvard Business Review, January 2001.

DeMott, D. A. (1985) Perspectives on Choice of Law for Corporate Internal Affairs. Law and Contemporary Problems, Summer 1985.

Emmons, R. A. (1999). The Psychology of Ultimate Concerns: Motivation and Spirituality in Personality. Guilford Press, New York

Edmunds, Mary Ellen (2005) You Can Never Get Enough Of What You Don’t Need: The Quest For Contentment.

Gallopin, G., Al Hammond, A., Raskin, P., Swart, R. (1977) Branch Points: Global Scenarios and Human Choice: A Resource Paper of the Global Scenario Group. Stockholm Environmental Institute.

Greenfield, Kent (1998) Gradgrind’s Education: Using Dickens and Aristotle to Understand (and Replace?) the Business Judgment Rule. Brooklyn Law Review. Vol 63

Greenfield, Kent (2006) The Failure of Corporate Law: Fundamental Flaws and Progressive Possibilities, University of Chicago Press

Habermas, J; (1984/7) The Theory of Communicative Action, (I) Reason and the Rationalization of Society; (II) Lifeworld and System. Beacon Press, Boston

Kotelnikov, Vadim. (2008) 25 Lessons from Jack Welch

Levy, David. (2008) Love and Sex with Robots: The Evolution of Human/Robot Relationships, Duckworth Overlook.

Zaleznik, A. (1977) Managers and Leaders: Are They Different? Harvard Business Review

1 ‘one day … there will be more human beings who live off the Earth than on it. We may well have people living on the moon. We may have people living on the moons of Jupiter and other planets … I know that humans will colonize the solar system and one day go beyond … What does concern me is that where other people go, the United States must also be. I’m not trying to stomp other people into the ground, but I would like to be assured that wherever the frontier of human civilization is, that people from America are there as well… . It should be viewed as an investment in carrying American culture, American values’. Washington Post September 25, 2005. Interview with Michael D. Griffin. NASA’s Griffin: ‘Humans Will Colonize the Solar System’

2 Corporations create profit by adding value – profit is the evidence of their virtue and, distributed via shareholders, it becomes the wealth that ultimately enriches everyone. That is market capitalism, at least it would be if large corporations operated in a perfect market. The theoretical market contains many small competing suppliers whose operations are geographically limited and whose conduct is governed by the community to which they belong. Their customers know this and are able to make informed choices. Individuals may make less than perfectly rational choices, but their biases and miscalculations will tend to cancel one another out so that the honest firm selling good stuff at reasonable prices will tend to sell more than the crooked firm selling rubbish at a premium, in the long run. If a firm dumps cyanide in the local stream, it will be found out and its popularity may be compromised, at least with local fishermen. Here lies a crucial difference between the ideal market and the one we’ve got: the modern corporation creates profit not just by adding value, but by avoiding costs. It might, for instance, avoid the cost of treating waste by dumping it in the river. The firm externalises many of the costs of operating. In other words, everybody else ends up paying for them. Not only do large corporations routinely externalise costs, they also receive subsidy from the public purse that, in some cases, swells their profits (the US motor industry is a good example). When this is the case, there is no virtue in profit and no true wealth is created, the corporation is acting unsustainably, not in the sense that it cannot go on dumping in the river and making money, but in the sense that it is depleting the commons, it is taking without heed for the cost of replacement. Some of what it takes is absolutely irreplaceable and some of what it takes is beyond all practical expectation of replacement, as when a company builds a dam, displacing people whose lives and relationships may never be the same again. They may be compensated, but the loss in community value, continuity and coherence is incalculable. If a firm fires people to achieve greater efficiency, it is externalising the cost of that efficiency as disruption, impoverishment and loss of identity.

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