Recently I had an interview with Michael Ullmer, Deputy CEO of NAB (National Australia Bank) who explains Responsible Leadership is first and foremost about doing the right thing.
Sometimes in organisations people get bound up and make things too complicated. But if you sit down and discuss a particular challenge - forget about the policies and procedures - and ask if you were to solve this by just doing what you feel is right - what would you do?
It is interesting how framing it as simply as that often allows people to identify insightful ways of solving a problem that also meets the policy requirements, without being distracted by the minutiae.
Many large organisations struggle with such a simple notion. You could ask whether the banking industry would have the current public relations challenges if issues were viewed through the lens of 'doing the right thing'.
The second dimension of responsible leadership is that it drives long term sustainable growth in shareholder value - this is something I believe very strongly.
This is not an altruistic perspective - this is about doing what is in the best long term interests of shareholders.
So while responsible leadership may have altruistic components this alone is not sustainable from a business perspective.
Looking at the current situation in the banking industry, many have been turning a tin ear to the legitimate complaints from external constituencies. This may lead to a new regulatory overlay that can damage long-term value for shareholders. Whereas proactively 'doing the right thing' has the potential to get ahead of the curve, enchancing reputation, and thereby creating long term shareholder value.
For example, NAB, by removing unpopular fees like those on unauthorised overdrafts, has improved relationships with customers and increased engagement with our staff, leading to increased advocacy for our brand.
As a result, a year down the track, we have seen a very significant increase in net new account openings. There has also been a significant lift in the volume of mortgages we are writing.
We are doing the right thing by our staff, investing heavily in development of our leaders in a holistic way – as individuals and in context of what is relevant to us as an organisation.
One program has been ‘The Leader Within’ run by Manfred Kets de Vries from INSEAD to see what motivated people as leaders and what their true beliefs are. This has had a profound impact on staff as they discovered what future they wanted from their roles.
This is about getting people to align their true inner feelings and drivers with the organisational objectives.
Two years ago we introduced the Enterprise Leaders Program for our top talent where we have assembled a faculty of professors from the leading business schools to build capacity to drive value at an enterprise level.
We have also worked with the Benevolent Society to introduce into our development programs elements addressing ethical leadership and engaging with the community.
This is about developing people, as individuals, through formal learning, mentoring, coaching and the like, and importantly working on specific projects that build capability.
We have graduates working on community projects supporting organisations such as the Cystic Fibrosis Foundation to address key strategic issues that develops their skills in complex problem solving, project management and teamwork. At the same time, the community organisations get access to skilled resources that help them take their organisation forward.
So to me, responsible leadership in a business context is about taking a long term view and recognising that doing the right thing by your customers, community and staff is key to delivering long term sustainable value for shareholders.
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