aligning corporations and society: what leadership is needed? prof. rob van tulder department of...
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Aligning corporations and society: what leadership is needed?
Prof. Rob van Tulder
Department of Business-Society Management, Partnerships Resource Centre
“We're the world's biggest NGO…”
Paul Polman, CEO Unilever
TRANSFORMATIONAL LEADER ….
…. The only difference is, we're making money so we are sustainable.”
“ Half of the women in the world do not take part in the labour market. This is not only a missed opportunity in terms of the skills and potential of these women, but is also damaging for the world as a whole."
Monique van ‘t Hek
WHAT ABOUT TRADITIONAL NGOS?
THE GOVERNMENT PERSPECTIVE….
“Three lessons we should take to heart as we move forward….
First: by working together
Second: goals …. should go hand in hand with multi-stakeholder involvement,…
Third: we must have more private sector involvement in long-term financing, in public-private partnerships and in projects on the ground.”
27 September 2015
The basic alignment challenge….
Companies NGOs Governments
Value proposition: adding and scaling value
Value proposition: enablingValue creation
Value proposition: Creating and living value
“ Shared Value Creation”
Choice of issues that are material to companies
Choice of issue that are material to society
Leadership challenge overcoming barriers to alignment (positive agenda setting)
RSM-ORG research on leadership…
The leadership discourse does not help…
Servant leadership
Authentic leadership
Transactional leadership
Transfor-mational
leadership
Thought leadership
Integrative leadership
Visionary leadership
Ethical leadership
Autocratic leadership
Transitional leadership
connected leadership
Strategic leadership Collective
leadership
Sustainability leadership Social
leadershipPragmatic leadership
connectedleadership
Valuing leadership
- Context dependent- Related to transition phase- Related to societal issue- Combinations possible- Strongly related to value proposition of
company- Legitimacy of leader depends on ‘poor’ vs ‘rich’
value proposition (and segment)
Serious Legitimacy problem
Legitimacy?
“Poor value proposition” means
“Rich value proposition”
General characteristics
Instrumental, simplistic, quantitative
Resilient, inspirational, entrepreneurial, qualitative, societal orientation
Finance Profit maximization; cost minimalizing;shareholder value
Enable the financial means for a company to thrive;
Purchasing/supply chain
Purchase as cheap and as flexible as possible
Empower suppliers to contribute to your value creation process
HRM Produce with the least number of people the highest possible output
Organize an inspired and committed staff
Strategic management
Being the biggest, the first Being the most innovative, creating the most value for society, solving particular societal problems
Challenge: reframe your value proposition
“Poor value proposition” means
“Rich value proposition”
General characteristics
Instrumental, simplistic, quantitative
Resilient, inspirational, entrepreneurial, qualitative, societal orientation
Finance Profit maximization; cost minimalizing;shareholder value
Enable the financial means for a company to thrive;
Purchasing/supply chain
Purchase as cheap and as flexible as possible
Empower suppliers to contribute to your value creation process
HRM Produce with the least number of people the highest possible output
Organize an inspired and committed staff
Strategic management
Being the biggest, the first Being the most innovative, creating the most value for society, solving societal problems
Challenge: reframe your value proposition
What is material to you?
Agenda setting: the search for materiality
What do we know of the materiality approach of big
companies?….Our research:- Almost all companies engage in materiality questions (G4)- All also engage in ‘partnering’ - Most engage in stakeholder dialogues and engagement- Motto and vision development as internal and external alignment
strategy is taken up
What do we know of the materiality approach of big
companies?….Our research:- Almost all companies engage in materiality questions (G4)- All also engage in ‘partnering’ - Most engage in stakeholder dialogues and engagement- Motto and vision development as internal and external alignment
strategy is taken up
The practice of materiality:- Still quite reactive or selection of ‘easy’ issues- Supply driven- Stakeholder consultation from the perspective of company interests- Implementation is not guaranteed- Selection of stakeholders is skewed: friendly stakeholders prevail- Relationship with partnership portfolio is not clear or contains gaps- Every year ‘priorities’ change (because of changing stakeholder
engagement)
What do we know of the materiality approach of big
companies?….Our research:- Almost all companies engage in materiality questions (G4)- All also engage in ‘partnering’ - Most engage in stakeholder dialogues and engagement- Motto and vision development as internal and external alignment
strategy is taken up
The practice of materiality:- Still quite reactive or selection of ‘easy’ issues- Supply driven- Stakeholder consultation from the perspective of company interests- Implementation is not guaranteed- Selection of stakeholders is skewed: friendly stakeholders prevail- Relationship with partnership portfolio is not clear or contains gaps- Every year ‘priorities’ change (because of changing stakeholder
engagement)
Conclusion: there is considerable improvement possible!
Example: Bayer’s value proposition
‘easy part’ ‘difficult part’
Science Better Life
Inside-out Outside-in
Alignment of cultures External alignment of cultures
Stakeholders? Stakeholders?
Materiality? Materiality?
Leadership toolkit? Leadership toolkit?
Bayer’s value proposition
‘easy part’ ‘difficult part’
Science Better Life
Inside-out Outside-in
Alignment of cultures External alignment of cultures
Stakeholders? Stakeholders?
Materiality? Materiality?
Leadership toolkit? Leadership toolkit?
Bayer’s value proposition
‘easy part’ ‘difficult part’
Science Better Life
Inside-out Outside-in
Alignment of cultures External alignment of cultures
Stakeholders? Stakeholders?
Materiality? Materiality?
Leadership toolkit? Leadership toolkit?
Bayer’s value proposition
‘easy part’ ‘difficult part’
Science Better Life
Inside-out Outside-in
Alignment of cultures External alignment of cultures
Stakeholders? Stakeholders?
Materiality? Materiality?
Leadership toolkit? Leadership toolkit?
Example Bayer’s value proposition
‘easy part’ ‘difficult part’
Science Better Life
Inside-out Outside-in
Internal alignment of cultures External alignment of cultures
Stakeholders? Stakeholders?
Materiality? Materiality?
Leadership toolkit? Leadership toolkit?
LIFE: Leadership, Integrity,Flexibility, Efficiency.
Bayer’s value proposition
‘easy part’ ‘difficult part’
Science Better Life
Inside-out Outside-in
Internal alignment of cultures External alignment of cultures
Primary stakeholders Secondary stakeholders
Materiality? Materiality?
Changing business model Partnership portfolio
Leadership toolkit? Leadership toolkit?
20142013
Materiality Matrix
Increasing insights….
Our advice: from negative to positive framing
Common Frame for the global community (for next 15 years)
Your leadership survival kit…
Connected leadership Thought leadership Transformational leadership Visionary leadership Ethical leadership Strategic leadership Sustainability leadership
Smart combinations
Timely
Issue dependent
Partnership
portfolio
management
Materiality
(shared) value
proposition!
Positive frame
Consistent (15
years) but flexible
?
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