Leading With Purpose Is The Key To Environmental, Social And Governance Success

“In terms of what skill leaders need right now – maybe they don't actually need to be good managers. Maybe they need to be good purpose-finders.” –Bill Hulseman

Bill Hulseman is an independent consultant who designs rituals, facilitates dialogue, and supports educators in developing school culture. He shared this an October gathering of the Leadership in the Age of Personalization (LAOP) Consortium:

“Every [Consortium] conversation seems to come back to purpose and mindset, and the lack of clarity about what each organization's purpose is seems to be the stymieing factor. [We need] chief purpose-finders for organizations. Somebody needs to take the helm of clearly articulating and modeling, ‘what is the organization moving toward?’”

This article is the last in a six-part series that addresses the?importance of individuality , how to see where?we’re suppressing ?it, how we can?change the way we lead , how to?avoid becoming obsolete ?as leaders and?evolve our organizational culture . These articles feature insights from individuals across industries (doctors, professors, executives, deans and more), who shared stories at our recent?Leadership In the Age of Personalization Summit .

It seems fitting to end this series on the subject of leading with purpose. Leaders today are telling me:

• Everything has changed, people are scared and losing hope
• Employees are the most urgent need across sectors (attracting, retaining, engaging, activating)
• Talent has the upper hand: people can go where they want, we need to re-recruit our people
• Older leaders are less motivated to change, younger leaders want change but need a roadmap

But the good news is: there’s an opportunity for leaders to co-design that roadmap by partnering with and empowering younger leaders.

Leaders at the highest levels understand this need, but don’t always know how to meet it. It starts with purpose – individual purpose and organizational purpose.

According to Teri Fontenot , CEO emeritus of Woman’s Hospital and member of several public and private boards of directors, CEOs of large public companies “made a major philosophical pivot last year when they announced that public companies should no longer consider shareholder returns to be the most important priority. They now say that corporations should focus on their broader societal impact and responsibility.”

This is a trend to prioritize impact related to environmental, social and governance, known as ESG.

ESG is a priority for boards: the Center for Audit Quality looked at the most recent publicly available ESG data for S&P 500 companies and said that?95% of S&P 500 companies had detailed ESG information publicly available .

ESG is a priority for CEOs: the?2022 EY US CEO Survey ?finds chief executives maintaining growth strategy while pivoting toward ESG and sustainability.

But here’s a question: Is ESG simply the new CSR? And here’s a warning from?this opinion piece published in The Regulatory Review : “ESG initiatives will provide little social value if firms do not improve conditions that led CSR to fail … By many estimates, CSR—in which companies?integrate ?social concerns into their business strategy and operations via stakeholder engagement—has yet to?transform ?firms to innovate. But if firms do not fix the harms that motivate CSR initiatives, should we expect ESG to do better?”

This is where purpose-driven leadership can come into play.

The only way to make sure ESG priorities are genuine and ESG activities are effective is if they’re shaped and driven by people who are leading with purpose.

Know Your Organization’s Original Purpose

Let’s look at higher education. We can (perhaps understandably) judge universities for being too slow to change and too rigid with their standards. But Wendy York , dean of the Wilbur O. and Ann Powers College of Business at Clemson University, reminds us of its original purpose.

“We need to understand why higher education is the way it is and that that structure can sometimes lead to stifling, but it also can lead to good things. The organizational structure was modeled on the monasteries that were started in the high Middle Ages. The monasteries had a codified way of doing business and it was quite insular, and it was done that way on purpose. That was the guard rail to keep the clerical religious mission separated from the heathen world, where you had Kings that put themselves in charge of religions.”

Knowing why some systems function the way they do helps us as we try to evolve those systems to better suit the purpose we’ve committed to.

York herself is an embodiment of one of those evolutions.

As she has said in the past: “I'm not a traditional academic, so I'm blissfully immune to the institutionalized thinking.” She was heavily recruited to her position of academic dean, even though she doesn’t have a Ph.D.—which is typically required of a dean.

I asked her when will higher education begin to hire more people like her? She is someone with a robust business background. She held executive-level positions in small and large non-profit and for-profit organizations, including employment with Bechtel Power Corporation and Bank of America. She’s started and/or ran four early-stage technology and internet companies and also co-managed a venture capital fund for more than five years.

She said the metrics can get in the way of that larger purpose of bringing relevant expertise into classrooms.

“We really need to take a look at the metrics of success for a business college,” she said. “The ratings [related to accreditation] penalize us if we have too many people with real-world business experience in the classroom teaching. They look at a ratio of teaching hours delivered by people with Ph.Ds.”

Evolve Your Organization’s Original Purpose

Nancy Hubbard , dean and professor of the University of Lynchburg College of Business, adds another layer to our understanding by showing the difference between U.S. university systems with those in Europe.

“In Europe, there's a big difference with universities,” said Hubbard. “With a few exceptions being graduate private business schools, almost all universities are state owned and run. They are free—or charge a very nominal fee. Now, that comes at a price and the price is there's a utilitarian attitude for higher education in Europe. The idea is, if your country needs X number of doctors, then we're going to have X number of people in our universities learning to be doctors. If we have more people who are qualified, we'll have a lottery system and you take a chance on getting into med school. Or, we need a certain number of kindergarten teachers. We're going to have this number of spaces for kindergarten teachers.”

How can you use your purpose to meet an immediate community need?

Mike McDonough is president of Raritan Valley Community College. For him, the purpose is in the name.

“Community colleges – we are located in our community. So, I have to share leadership. The only way I'm going to sustain the college is through aggressive public/private partnerships. Federal governments and counties have abandoned the community college from a funding perspective. Our business model is bankrupt. It will not continue. It can't continue. It won't continue. So, for example, we have a partnership with a large medical diagnostic testing service in the United States. They have a tremendous need for medical lab technologists. It's not a four-year degree, but it is a credential. So they are going to pay us a half million dollars to design and build that program.”

“Now I need to do those 20 times in the next year. And we'll be okay. There's still a tremendous need for community colleges. My last data point is that over 50% of people in this country who get a baccalaureate degree, started at a community college.”

How Can We Find Our Purpose as a Leader?

We might think we know our purpose: if we lead or work at an institution of higher education, we might think we’re already working toward a purpose of teaching and adding to the body of knowledge. But we can dilute our purpose by serving one audience at the expense of another.

Peter Baron is a student at Fairfield University. He said it doesn’t feel like the university’s purpose is to serve him.

“I don't think students are the university's customers,” said Baron. “I think students' future employers are the customers and the students are the products. Knowing their customer base, higher education institutions focus on improving their students' job placement and retention rates after six months of graduation, or on getting more students placed in the top 500 businesses. Colleges are trying to have students become really good prospective employees.”

“In the age of standardization, the purpose of education was content,” said Baron. “It was about imparting knowledge on students. If you're an accounting major, we're going to give you the skills to be an accountant. This is because the goal of standardized education is to produce employees that fit the standard model. But today, this must change. We must instead start educating for the sole purpose of creating educated individuals. What we will see is that this model of educating will bring students in touch with their authentic individuality and thereby will actually create better employees than the old model.”

Baron said last year he heard an academic leader suggest that education should be guided by a question, not a major. “I started thinking about my question,” said Baron. “I'm interested in sociology, philosophy, rhetoric, politics and history. I figured out my question is, ‘are socioeconomic inequities inevitable? Or are they avoidable?’ Now I have an individually designed major centered around that question. And because I'm leading with a question instead of just a discipline, in every course I take I'm thinking about my question and how it fits in with what I want to solve for.”

That’s a powerful way to find your individual purpose. Now let’s bring it back to our corporations.

Gustavo Canton helps us see how we can harness individual purpose for the benefit of the organization. He is an analytics leader and expert in data science, most recently for Starbucks.

“The value of data science is to actually help organizations and individuals find their purpose. People analytics is not about the HR function. It's about learning how to take care of your partners, your customers, and your communities.”

He said, "Many organizations rely on external data sources for employee (such as LinkedIn) even though they have internal data sources. The challenge with company internal data sources is that in many instances it is not accurate, or it might be incomplete. To me, that doesn't make any sense. You don't even know the people who work for you. So, for me, the first step [when I’m helping someone figure out what data would be useful to them] is to listen, to try to understand the environment, the situation. Who are the stakeholders? What is the true purpose they're trying to achieve? And then from there you can figure out where to invest to create the data, to better understand your population, to better understand how to reach your purpose.”

Create a System That Supports Leading With Purpose

That’s largely what the commitment to ESG is trying to accomplish. We want initiatives and actions that make our purpose a reality. But that’s where we fall short if we don’t focus on training people to know themselves and to know each other

That requires skills and tools to cascade purpose throughout our organizations:

• Training in how to know people as individuals and help them know themselves
• Time and resources to learn our own leadership identity and purpose
• Training in how to create experiences that spark movements so people put purpose to action

I began this series by quoting?Deborah Lovich , a managing director and senior partner at Boston Consulting Group (BCG): “The ‘war for talent’ is over. Talent won.”

She says it’s time for leaders to rethink and recalibrate their relationships with their people.

Leading with purpose is how to do that. And we can only lead with purpose when we learn to activate each other’s full capacity and support each other’s dignity. In other words, when we unleash individuality.

Order my new book,?Unleashing Individuality: the leadership skill that unlocks all others .

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