The Cult Of ‘I’ Is Bad For Business.
By Marc Cox, Founder of The Company Spirit and author of ‘The Business Case for Love: How Companies Get Bragged About Today’
It is possible that Boris Johnson, the current UK Prime Minister and Jeremy Corbyn, the current leader of the Labour Party, know little about Carlos Ghosn. He is the former Chairman of the global car manufacturing cartel of Renault, Nissan and Mitsubishi, and is now awaiting trial in Japan. Ghosn has been charged with four counts, principally that he failed to report more than $80m in pay that he was due to receive over 8 years up to March 2018. Johnson and Corbyn are locked in their own trial. The court of public opinion as both seek to win enough support to become the next Prime Minister in the forthcoming General Election. What connects the three of them is that each one has succumbed to the cult of ‘I’, with dangerous consequence for all.
Anyone living in the UK knows that trust in politics and our politicians is at an all time low. The lies of Brexit, the inability of most politicians to answer a question truthfully and Parliaments failure to find a way to deliver the result of the 2016 referendum have left the country exhausted, bemused and not sure of what happens next. No one really knows how and when the country will get out of the mess we are in.
There is a lot of anger aimed at politicians of all political persuasions and, largely they have brought this upon themselves though their own behaviours. Of course I cannot condone the verbal and sometimes physical threats our MP’s, and in particular our female MP’s, receive on a daily basis. They sadly, have become the lightening rods for many peoples own frustrations.
In reality they are paying the price for years of so many politicians saying one thing and doing another and not listening to the needs, wants and concerns of the electorate, their customers. Preferring the clubiness of the ‘Westminster Bubble’ over the reality of day-to-day life for the people they represent.
The response by all our political parties has been to reinforce the cult of ‘I’. The focus on the personality and leadership skills of Boris Johnson, Jeremy Corbyn in the UK and Nicola Sturgeon in Scotland. Each is offering their own extreme vision for the future of the UK. Jo Swinson, as leader of the centrist Liberal Democrats, is offering her own binary choice, "Stop Brexit". The dilemma is that this is not a presidential election. In the UK, traditionally you vote for the party and MP who you think best reflects your own interests, with an eye to to who is party leader. Not the other way around.
Both the leading parties have form in this. The last general election in 2017 pitted Corbynmania against the "strong-and-stable", who became the ‘weak-and-wobbly’, Theresa May. No doubt Conservative thinking is that Boris, the characterful and charismatic campaigner will be a lot clearer, more engaging and empathetic and will win over the day. Jeremy Corbyn is portrayed as the man of the people, as long as you are in his team and agree with what he says and does: for heaven help you if you disagree with his ‘thought police’.
For the electorate this is not a great place to be as the personality overshadows the manifesto. Whilst other party spokesmen will be rolled out during the campaign, there is very little sense of ‘We’. No Team Conservative, Team Labour or Team Liberal Democrat. Putting voters in quite a dilemma. Often agreeing with the thoughts of their local candidate but unsure of who to trust amongst a very untrustworthy group of Party Leaders.
The cult of ‘I’ in politics is largely about ego and power. Money only comes into it after politics and when the PM has left the stage. Most notably, Tony Blair. Less so David Cameron, whose autobiography ‘For The Record’ has already slipped out of top 10 non-fiction hardback chart. No doubt his coffers are filling up on the conference circuit. Even Theresa May has signed up with the Washington Speakers Bureau to share her wisdom with the unsuspecting American nation. Good luck with that! I hope she can come up with something more informative and inspiring than "Brexit means Brexit" otherwise I suspect her speaking tour will be short-lived.
Which brings us back to Carlos Ghosn. Money, greed and avarice are again the seeds of his downfall. Company ambition and personal enrichment became completely entwined. A story brought to life in the excellent FT article ‘The Downfall of Carlos Ghosn’ which quotes a large dealer for Nissan in Japan as saying “He had turned into an emperor without clothes” and that “a scathing governance probe by Nissan has condemned the ‘personality cult’ and opaque, unquestioned authority of the Ghosn era”. In 2017-18, he earned a combined pay package of $17m and when questioned by the FT, just months ahead of his arrest whether he thought he was paid too much, “Ghosn laughed: ‘You won’t have any CEO say ‘I’m overly compensated. It’s not up to me, the board is sovereign on this’”.
Ah, the familiar refrain when a CEO is questioned over their salary. ‘I didn't ask for it, the Board set the figure.’ Peter Fankhauser, failed CEO of collapsed travel company, Thomas Cook, when asked by Rachel Reeves, chair of the Parliamentary committee looking into the reasons behind the failure, over the level of his pay and bonus said “I am not the one who is setting my pay and deciding my bonus”. 18 months earlier, the report published by the same Select Committee, into the collapse of Carillion highlighted, according to The Guardian “the recklessness, hubris and greed’ among directors who put their own financial rewards ahead of all other concerns. The damning 100-page report found that directors prioritised senior executive bonus payments, dividends for shareholders while treating pension payments as a waste of money”.
The report, headed by Frank Field and Rachel Reeves concluded that “Government urgently needs to come to parliament with radical reforms to our creaking system of corporate accountability. British industry is too important to be left in the hands of the shysters at the top of Carillion”. The role of the auditors also came under heavy criticism with a recommendation that the big four-KMPG, PwC, EY and Deloitte-be referred to the Competition and Market Authority, which should consider whether they ought to be broken up forcibly. Fine words and good ideas but, once again, nothing tangible has happened. Neither the Directors or the Auditors have truly been brought to account.
Given the long standing resentment felt by large parts of the population, that the Bankers got away with it in 2008, a decade of corporate scandals powered by the cult of ‘I’ has fuelled growing concern about the way business and largely ‘pale, male and stale’ businessmen behave. Throw in a heavy dose of #metoo claims against some leading businessmen, the antics uncovered at The Presidents Club dinner in January 2018, and the reputation of business is not in a good place. And it has only itself to blame. Allowing huge support, particularly, from those under 40 for Labour’s essentially ‘Business is Bad Manifesto’ whereby large parts of British Industry would be re-nationalised if Labour comes to power.
The Conservative leaning press shouting that this ‘Will Turn The Clock Back to the 1970’s’ completely miss the point. This generation was not born in the 70’s, never experienced the ‘Winter of Discontent’, the ‘Three Day Week’ or the disaster that was British Rail and judge the performance of many of the companies Labour wants to re-nationalise against their own current customer experience of the railways or their energy companies and feel they come up short for the money they pay.
Will the ‘pale, male and stale (and some female)’ swathes of businessmen who sit on the boards as either executive or non-executive members recognise that the cult of ‘I’ is bad for business? Probably not as they are part of the problem, yet the evidence is staring them in the face. From parliamentary reports to academic research projects.
Lynn Stout, from Cornell Law School, wrote and published the article “Killing Conscience: The Unintended Behavioural Consequences of ‘Pay for Performance”in 2014. She proved, what most people assumed, that the more that chief executives get paid, the worse their companies perform over the next three years. She found that workplaces that rely on bonuses promote selfishness and opportunism with the end result more uncooperative, unethical, and illegal employee behaviour. Which was in essence what happened at Carillion, Thomas Cook, and with Carlos Ghosn.
The Institute of Leadership and Management interviewed more than 1000 managers across the economy and found that only 13% put being paid a bonus as one of the three main factors that motivated them. Enjoyment of the role came top (59%), while getting along with colleagues came next (42%). A joint study in the UK and Australia by academics at the Universities at Leicester, Sydney and West Sydney showed that it made better business sense to reward team performance rather than single people out for individual bonuses. So a bit like, back in the day, when a Christmas bonus would be rewarded to all employees and only when the performance of the company justified it.
These themes and more are explored in my new book “The Business Case for Love-How Companies Get Bragged About Today” which will be published by Palgrave MacMillan in the early part of 2020. As part of my ‘To Do’ list a preparation for the launch, and when on my way to Stockholm, I found myself standing at the Business Book counter at WH Smith at Gatwick doing some market research into what makes a striking and compelling cover design.
I concluded that few business book covers stand out. Almost all are quite ‘head-led’ and ‘shouty’. All based around the premise of ‘how to be a better/more successful leader’. Almost all come across as a ‘boring business book’. When faced with this sea of mediocrity, I picked up Robert Iger’s book ‘The Ride of a Lifetime’ to see what the CEO of the Walt Disney Company had to say for himself. I didn't think the cover of Iger’s book was particularly great but the sub head of “Lessons in Creative Leadership’ piqued my interest so I brought it and set about reading it on the flight over.
It is a good read and I would recommend it to those who enjoy a book that is essentially ‘leadership by storytelling’. Time and time again he emphasises the importance of ‘team’ as part of his leadership philosophy. Bob Iger is extremely successful and has become very wealthy. His salary and bonuses are are out of the comprehension of most of us yet he ends the book with a series of ‘Lessons To Lead By’. The last two are telling!
• You have to approach your work and life with a sense of genuine humility. The success I’ve enjoyed has been in due part to my own efforts, but it’s also been due to so much beyond me, the efforts and support and examples of so many people and to twists of fate beyond my control’.
• Hold on to your awareness of yourself, even as the world tells you how important and powerful you are. The moment you start to believe it all too much, the moment you look at yourself in the mirror and see a title emblazoned on your head, you’ve lost your way.
So Iger is fully signed up to the cult of ‘We’ not ‘I’ and the Walt Disney Company has been very successful with this philosophy at the helm. In the year that he was named CEO, Disney made $2.5 billion in net income. Last year (2018) the company’s net income was $12.6 billion, a 404% increase. Similarly, the Disney stock has risen exponentially. Shares of Disney are up 450% from $25 per share in 2005 to nearly $140 in August 2019.
Bob Iger is 68 so ticks off two out of the three. He is pale, male but anything but stale. For me, this shows it is not about age but attitude and leaders have a choice about how they behave. Choosing either, the cult of ‘I’ who view business as a game with no personal accountability and care little about the consequences for the organisation. They are narcissists driven solely by personal gain. They understand business as a machine solely to create products and ‘money in the till’. Heartless and mechanistic. Happy to create a purely transactional experience for employees and customers alike. They have no idea how to create companies that are loved by their employees, customers, the media and other stakeholders.
Or, the cult of ‘We’ where companies that are thriving not just surviving simply go another way. They view business as a social system operated by people for people. They care. They know that sustainable success or failure depends on the quality of relationships both inside and outside the company. They want to be the brand you brag about to your friends. They want you to love them.
This choice will not be driven by the current set of non-execs and CEO’s within UK plc. Many are too stale, too part of the Establishment who have proved incapable of change and facing up to the responsibilities of business behaviour in 2020 and beyond. It will, however, be driven by the employees because they increasingly reject the cult of ‘I’ as it is at complete odds with what they expect from work and leadership. I am confident in this prediction because I have been lucky enough to work with hundreds of people over the last decade drawn from a variety of countries and cultures in the UK, Europe and beyond.
Having listened to what they say and feel about being at work my own experience suggests that for the vast majority of employees and in particular those under forty expectations have significantly changed. How they see themselves at work and the behaviour they hope to see from their boss. They want their leaders to have clarity on, and communicate openly the direction of travel for the company, the financial objectives and the strategy to get there. They want this shared in an honest way. They also want to feel involved in bringing this strategy alive. They want to feel that they are collaborating with their peers and their leaders to get there.
I call this the ‘Facebook’ effect. The positive side of Facebook. Over the past fifteen years people have become accustomed to a world of ‘liking,’ ‘commenting’ and ‘adding’ to what they see on their social media feeds. They now want to do that at work. For them, there is a complete blurring of the lines, a mash-up of “work” and “play”. At work no longer means “being in the office,” at play no longer means “out of the office”. Technology means that today’s employees dip into both on the way to work, while at work and on the way home. People no longer feel the need or desire to dress differently for work. Their “work face” and their “home face” are less distinct. Whilst they want to respect their leaders they do not feel the need to hold them in reverence or want to be fearful in their presence. They expect similar levels of treatment and respect from their boss or colleagues that they have with their friends. They want to work with people they care about. They reject the old “JFDI” (Just F****** Do It) where the only real winner is the boss and are seeking instead, a leadership approach and culture more in keeping with their needs and their own values.
They would reject the culture created by Carlos Ghosn. They would embrace the culture, Bob Iger cultivated at Disney. With dark nights ahead we could do with some of his magic to lighten the gloom as we wade through what will no doubt become an increasingly bitter and divisive General Election campaign over the next month. If Boris Johnson wins he will no doubt liken it to entering the Magic Kingdom of ‘Getting Brexit Done’. If Jeremy Corbyn wins, he will no doubt want to nationalise Disney so that the state can control what we enjoy and when.
The Business Case for Love: How Companies Get Bragged About Today. By Marc Cox. Published by Palgrave MacMillan in early 2020. Pre-Order
Marc also offers regular Business Case for Love Taster Events for executives. Details