'2050 is a critical date,' says Andrew White, Senior Fellow in Management Practice.
‘By then, we will know if we’ve solved the existential risks that the world faces.
‘We will know if current and future company leaders can find the solutions. The world needs to transcend these risks and turn them into opportunities. So what happens between now and then is incredibly important.’
Leaders of the future
To get an idea of what the future will look like, we need to go back seven years.
Andrew and Michael Smets, Professor of Management, were part of the team that conducted interviews with 150 CEOs across a broad range of territories, sectors and industries in 2015. Those interviews shaped what would become The CEO Report: Embracing the Paradoxes of Leadership and the Power of Doubt. Michael recalls: ‘Within The CEO Report we presented it as a decision-making model: how do we make some of the thorniest decisions when knowledge is limited? And of course, that has been the bread and butter of any political or corporate leader during the pandemic.
‘It’s been really interesting to see over the past year how much more accepting we have become of leaders saying “I don’t know”, “I don’t have all the answers”.
‘That was a big surprise to us in 2015; corporate leaders were willing to admit it, and actually celebrate it. They would say: “The more I doubt myself, the better my decisions and the greater my confidence.”
‘We asked: “How comfortable are you using those words within your organisation?” And, of course, a lot of times, it was, “Well, this is career suicide. I will use them with my teams, but not with more senior people.”
‘Then it became: “Well, once you understand and you can process certain situations of doubt, uncertainty and vulnerability more generally, you can also become a much more effective critic, friend, consigliere or coach for others.”’
But there are, of course, far greater challenges facing the business leaders of the near and more distant future.
A lot of people who reached the top 30 or 40 years ago got there because they were very good at execution. Now what is required is a different set of skills – to reinvent.
Andrew notes that the other major shift is that for 30 to 40 years many industries and CEOs enjoyed stability and steady growth. They could keep their heads down, would be visible to the public at AGMs and could walk off into the sunset with a handshake that wasn’t so much golden as platinum. Today, many industries and CEOs are operating in a state of near-permanent disruption.
Andrew adds: ‘A lot of people who reached the top got there because they were very good at execution. And yet what is now required is a different set of skills – to reinvent. To put things through a completely different structure, which is not just about making incremental changes.
'Global issues like climate change are driving massive changes within industries.
‘Over the past 18 months, we’ve had many instances of CEOs being very good at firefighting – we speak to a lot of executives who have had tremendous successes during the pandemic.
‘Think about digital transformation. We managed to do things in three months that previously we didn’t think could be done in ten years. We had Formula One teams making ventilators, cosmetics manufacturers producing hand sanitisers. There are all these great stories of agility. But the danger is that while they’re firefighting they lose the long-term perspective.’
In summer 2021 for his Leadership 2050 podcast series, Andrew spoke with Alan Jope, who became CEO of Unilever in 2019, succeeding Paul Polman, now the School Board Chair.
Jope recalls: ‘Two or three years ago, we got our leadership team together and we said, “What do we want Unilever to be famous for in future?” We established three things.
‘We said we want a stable of purpose-led brands that are the envy of the world.
‘We want to prove that sustainable business drives superior financial performance. To burst the false paradox that there’s a trade-off between doing the right thing and rewarding your shareholders.
‘And we want to be a beacon of diversity and inclusion. We want our company to be a role model where everyone can come to work feeling welcome and able to be their true self.
‘We’re finding that our sustainable living brands, those brands that have purpose at the heart of what they stand for and the actions they take, are growing more than twice as fast as the rest of the portfolio.’
His last point is verified by all kinds of studies by companies such as Kantar looking across industries over several decades. There’s mounting evidence that brands which take on important social or environmental issues are just simply growing faster because they’re more relevant for today’s consumers.
'I firmly believe that the purpose of an organisation matters,' Katherine Garrett-Cox, CEO of Asset Manager Gulf International Bank UK told Andrew in that same Leadership 2050 podcast series. 'It matters to those who work in it tirelessly every day. It should absolutely matter to shareholders and stakeholders.'
The increased prominence of purpose within organisations could even give rise to what Sam Gyimah, non-executive director of Goldman Sachs and former government minister, describes in episode 5 of Leadership 2050 as 'the citizen CEO; a chief executive that understands that their job is to deliver for their shareholders and have a corporate purpose… that they need to be at the forefront of in order for their organisation to be generally competitive. I think that is where success lies for the leader of 2050.’
Some leaders may also be surprised that sustainable sourcing can save money. It has for Unilever: ‘We were early on into using green renewable electricity,' says Jope. 'Now, 100% of the electricity used in Unilever is renewable. And that saved us about €1 billion (£840m/$1.12bn) in the last few years.’
He points, though, to a macro risk. ‘Climate change is not a “sometime in the future” thing for Unilever,’ he says. ‘These adverse weather events every single month are depressing sales.
Creating systemic change
As Andrew warns, if CEOs and companies get it wrong, the consequences could be disastrous. One has only to look at how Facebook tragically failed to tackle the spread of misinformation and the incitement of violence against the minority Rohingya in Myanmar, leading to thousands of deaths, human rights abuses and a million refugees in neighbouring Bangladesh. ‘Firms can move the needle positively or negatively in terms of the future of civilisation,’ he says.
‘Robotics, AI and other changes are coming down the road and are hugely important. And yes, it’s about governments regulating but we’ve often seen governments struggle to know how to do this.
‘Therefore, the leadership of firms becomes even more important because, as a collective, a failure to do so could have huge consequential issues that can also lead to the polarisation of society.’
Michael adds: ‘I think leadership will become more difficult because it will be systemic. And that means leaders will increasingly lead beyond their organisation.
‘But they will be able to rely less and less on formal and positional authority. Being the boss will hold less sway because you need the help of people beyond the realm of your expertise.
It’s about the need to be much more of a consensus builder, to be more consultative.
‘But then we also come back to the notion of how to get out of firefighting and into creating more of a systemic change? Again, it’s about the need to be much more of a consensus builder, to be more consultative.
‘And then that makes the leadership role more difficult, in the sense that the “because I say so” response just doesn’t fly.’
Jane Burston, CEO of the Clean Air Fund, agrees this consensus-building approach is important. When Andrew spoke to her for episode 4 of Leadership 2050 she told him that CEOs should, 'within your company and within your network of other companies or other organisations, find the individuals who are doing the same, who are also starting from where they're at and see how you could collectively work together.'
According to Jope, the traits required to succeed in future as a leader are twofold.
‘Unilever has been a leadership factory for a long time,’ he says. ‘And we have a bespoke model, built around two concepts.
‘One is the inner game. So, leaders need to be purposeful in their commitment to serve others. As leaders, we need to master our emotions and our intellect, and to remain curious, constantly relearning and reskilling. That’s all about mastering our inner game.
‘Then there’s the outer game. This is about having the traditional leadership capabilities, like business acumen, the ability to build talent, consumer and customer love. And there’s the need to have a passion for high performance, to set high ambitions, inspire teams with energy.'
New archetype of leadership
As Andrew says 'In summary, what we are seeing is the emergence of a new archetype of leadership. Leaders who are seeing beyond the boundaries of their own organisation and industry, and not limiting themselves to the demands of their shareholders. They are recognising not just the stakeholders they impact but the positive role on the parts of the world they affect. This requires a deep sense of personal purpose and values, not just from leaders, but at its best, when leaders harness the purpose and values of the employees too. This can create a movement which in turn shows us what the future of work can look like.'
Andrew leads and teaches the Oxford Advanced Management Leadership Programme and Michael teaches on the Oxford High Performance Leadership Programme.