Character has been codified. Now what?

Four SCNetwork members engage in a back-and-forth on Gerard Seijts’ presentation

Ian Hendry: On the basis that Western University’s Ivey Business School research appears to have been constructed, and subsequently validated largely by the corporate world, I think it sheds an interesting perspective on character.

I wouldn’t waste a lot of time quibbling over whether 11 (character traits) is the right number, but there is no question a lack of certain attributes has been at the core of numerous corporate implosions. Perhaps Wells Fargo is the latest, but the United States election will demonstrate how important character is seen as integral to leadership, albeit in some minds, the best of two evils.

The importance of character is not new, but has it been under-valued? With today’s need for quarterly results, unless character is brazenly dishonest, isn’t it just convenient to overlook its importance?  

Paul Pittman: Character is front-of-mind because of two well-known political figures filling our news platforms, both of whom are characterized as bad. We seem increasingly drawn to behavioural traits as a means of predicting outcomes and, in business, the creation of enterprise value.

First there were strengths, then values, and now character, and many of us have been screening candidates to assess “character” using other terminology for years. More information is always better, but I and several folks at our table struggled to see a major distinction between these techniques.

The takeaway for me is that by no means is this the simple tool that was portrayed. Behaving in the right way (doing the right thing) as opposed to being bad, is a subtly layered, complex response depending on the circumstance.

For example, what is perceived as the “right thing” is going to change as the makeup of the workforce changes. Strength of character is judged by stakeholders in the moment, and while we all agree on the basic tenets of good behaviour, the degree may be subject to circumstance. It’s not absolute and companies need to agree on their base definition before they start testing for it.

Most organizations strive to be good, despite there being no box to tick in the checklist provided by shareholder advocacy groups. Bankers behaved badly in 2008 and, in retrospect, we have determined they demonstrated poor character, but what about those who created the system that permitted — nay, encouraged — them to behave in the way they did?

Time changes perception, as does circumstance, and targeting good character may be a moving target.

Jan van der Hoop: It was interesting that the topic of “character” was such a draw — a full house, with oversubscribed, big players in the room. It clearly strikes a chord.

This thing called “character” has always been elusive and hard to define. And yet, as human beings, we generally “get it” at a subjective, almost instinctive, level… an individual or a culture either resonates with us in a pleasing way, or it does not.

I can only imagine how hard the initial work was for these guys to codify character — to put language and metrics to it. The model Seijts presented makes sense. For me, the face validity is strong.

The real question in my mind is, now what? Gerard Seijts was upfront about how heavily the results of a self-assessment are dependent on an individual’s self-awareness and candour, and even a 360-degree approach captures perceptions that are filtered through the character and biases of the rater.

But even if data can be “normed” somehow against an external benchmark (say, the general population or some generally held ideal), I wonder about the practical applications. The vision is appealing — some high-principled future state — but I’m missing the steps that will get us there and I’m unconvinced the world will be a different place.

Ian: But if it has to start somewhere, is it not at the board or CEO level? A values-based culture is more easily driven by a founder who is principled, rooted in the “character” Seijts has identified, but then instilled in her actions and lived through the behaviours (think Marriott). In a for-profit organization, it’s the principal shareholders who determine what success looks like and what sort of person can achieve those goals. 

Tracey White: In society and business, we get leaders who are motivated by the prevailing values and rewards.  If we value material gain more highly than, say, social equity or environmental sustainability, then we will get people in positions of leadership who seek material rewards. 

We have lived in a world, since the Ronald Reagan-Margaret Thatcher era, that told us corporations exist to maximize shareholder value and nothing else. Milton Friedman famously said a focus on anything else is socialism. These values launched a generation of leaders for whom greed was good — from Enron to Wells Fargo.

I agree with Paul — organizations have been on a quest for an easily administered, scalable tool to identify “leaders” from the wider population. Leaders defined as those who will maximize whatever outcome is sought. In corporations, this means shareholder value or profit, but these values have been mirrored in the public sphere, too. I fear “character” will simply be another chapter in this quest.

At the same time, I have a strong feeling we are off course in terms of the types of behaviours we reward in leaders. This thing we call “character” does seem to have been lost — my grandparents’ generation would have called it “moral fibre.” So, I left the presentation with a sense Seijts was on track.

Paul: At the risk of sounding obvious, no company, at least with public shareholders, targets bad — but we create environments that encourage or allow certain character traits to come to the fore and that overzealousness, left unchecked, tips into bad.

Murder is bad and charity is good but the subtleties in corporate life are not so clear. Bankers are now deemed bad, but at the time, they were creative and driven and loved by shareholders. EpiPen manufacturers, testing what the market would bear for their product, it seems now, behaved badly.

The CEO at Wells Fargo, now deemed bad, probably knew nothing about what was going on — his employees lacked the “moral fibre” to not use a system that motivated them to earn more money.

Cable companies that force us to buy products we don’t want in order to enjoy those we do — hmm, not so bad. Canada’s banks who give many millions of shareholders’ money to various causes are of good character (they saved us from the banksters, but not the good causers). Is Thatcher turning in her grave?

Seijts has got us talking, which is a good thing. “High moral turpitude” is highly desirable and we all seek what we think is right, but the constant ebb and flow  in corporate life changes with the mood in society, the economy, the business we are in, etcetera.

There are no absolutes but a process of continuously striving. Like diversity and sustainability, good character is something we need in leaders, and while individual successes may be hard to pin down, they all, over time, will produce better results.

I shared our session with a CEO prepared for a rant about esoteric HR ritual. The drive for dividends and capital value clearly motivates the behaviour of boards, with industrial relations and public relations providing a governor, but strength of character in a CEO was essential in enabling the  exercise of judgment over the “right thing” for all stakeholders.

Jan: Indeed. Perhaps the greatest value here is that this has us talking. In my experience, conversations about character in organizations have usually been in whispers, with clicking tongues and shaking heads. Even when it was in the open, say, in the succession planning cycle, the language to describe aspects of character was elusive and prone to misinterpretation.

So, good for you, Seijts. Thanks for the model, and the language around it — very helpful. It took a lot of work. And I do believe it can be helpful in an organizational context, if only to focus conversations and guide development.

I hope it grows legs in the areas where Seijts is working — government and the social arena. Heaven knows, we need it; but, at the end of the day, the court of public opinion, propelled by social media, renders quick (if not always fair or informed) decisions. Increasingly, bad behaviour gets publicly shamed; after all, the EpiPen folks got pretty quick feedback on their pricing strategy, didn’t they?

Tracey: I agree no one sets out to be a greedy or immoral leader. This is not just a problem (for broader society) for the business world, it also extends to public life and it seems to be an issue at all levels where individuals hold “leadership” positions.

I define leadership here as people with the power to make decisions, in no matter what context they operate. What character traits or values are they modeling?

Think of recent news of the young man held in solitary confinement, with lights on for 23 hours a day, in a Thunder Bay, Ont., prison. How could this happen in Canada? How could prison leaders not know that was torture? Why didn’t anyone at any level of the decision chain not stand up and say, “No, this is wrong”?

My guess is the people making decisions were not in senior-level roles. They are everyday people with the power to make decisions, but somehow they lost their moral compass, just as Wall Street bankers or Enron executives have done. What do their actions say about character? 

Perhaps we have worked so hard to single out the qualities that make great individual leaders that we have neglected the social context in which they operate.  If so, then followership needs much more consideration.

Ian: Those of us who attended this SCNetwork event have the opportunity, and perhaps even the obligation, to keep the importance of character fresh in our minds. For those not so fortunate, for a lesson on leadership — whether it be for teenagers, a work team or an executive team — take Seijts’ advice and revisit the movie Invictus, portraying the brilliance and humanity of Nelson Mandela, a man centred on strength of character.

Every person, from a CEO, down through the chain of command, can see how leadership character shows itself. Take the opportunity to personally reflect and hold up the mirror. It will lead to better organizations and governments.   

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