Yesterday's article discussed how the ethical behaviour of servant-leaders — demonstrated by personal morality and integrity — was embedded in four operating principles that guided them in their daily decision-making:
• Serve people;
• Help people grow;
• Exercise foresight; and
• Care about everyone the organisation touches.
These principles are ethical and effective, because they support high performance and exceptional organisational results.
Servant-leaders serve people. Serving others is ethical because it is respectful of the needs of others, and is an effort to treat people right by helping to meet their needs.
Serving others is also effective. When servant-leaders identify and meet the needs of their colleagues, their colleagues can perform at higher levels. When servant-leaders identify and meet the needs of their customers, clients are happy and likely to come back — and tell their friends.
Servant-leaders help people to grow. This respects each individual’s potential and recognises the importance of personal growth to job satisfaction. It is also a key to organisational success.
In almost every organisation today, people are the most important “resource”. When people grow, their capacity grows. When their capacity grows, the capacity of the organisation grows.
When the capacity of the organisation grows, the organisation can better serve its customers. Individuals benefit, the organisation benefits, and customers benefit.
Servant-leaders exercise foresight. Foresight requires the use of information and intuition to identify new trends and events that can shape the future.
A leader who does not exercise foresight may fail to adapt to change, and may get his or her organisation into trouble, hurting many people along the way.
Robert Greenleaf, who launched the modern servant-leadership movement, said that foresight is the central ethic of leadership. That is because foresight is central to the future existence of the organisation and its ability to meet its obligations.
Care about everyone the organisation touches
Servant-leaders care about everyone their organisation touches — employees, customers, business partners, lenders, shareholders and communities.
Organisations impact many people. The only ethical stance is to care about all of them, and to make the impact on them as favourable as possible.
It is not surprising to find servant-leaders and their organisations participating in the corporate social responsibility movement that began 20 years ago. Business leaders from around the world developed the Caux Round Table principles of business ethics in 1994, recognising the importance of treating all stakeholders fairly.
In 2000, the United Nations launched the Global Compact, a programme that is designed to encourage businesses to adopt sustainable and socially responsible policies, and to report on their implementation.
Businesses that sign the compact agree to abide by 10 principles in the areas of human rights, labour, the environment and anti-corruption.
Here in Singapore, corporate social responsibility is promoted by the Singapore Compact, established in 2005. Today it has 400 members focused on the triple bottom line — profit, people and planet.
The idea is that a multi-stakeholder approach for mutual benefit can result in doing well and doing good. Businesses can be competitive and innovative, creating quality jobs, products, services and wealth.
At the same time, they can devote time and resources to making their businesses socially responsible and sustainable. This helps them to attract and retain motivated and committed employees, achieve resource efficiencies, reduce risks, and win and retain consumers and business customers.
Scholarly research supports the effectiveness of caring about all stakeholders. Scholars from Arizona State University conducted a study of 126 CEOs of high-tech firms in Silicon Valley.
They found that the returns on investment were higher for firms whose CEOs were servant-leaders who took into account a broader number of stakeholders.
Based on his own research, Dr Dirk van Dierendonck, a leadership scholar at Erasmus University in the Netherlands, has suggested that paying attention to all stakeholders is the key to long-term profits.
If we want to improve both the ethics and the performance of our organisations, we need to model and teach servant leadership to our current and future leaders.
Article by Dr Kent M Keith, CEO of the Greenleaf Centre for Servant Leadership (Asia) based in Singapore.