Why boards must only consider CEOs who can connect with the future

Delivering profitable growth is clearly a key metric for measuring the ability and success of a CEO. But in today’s world, shareholders, employees and customers are demanding even more of leaders, with causes such as tackling inequality and climate change fast becoming essential business goals.

So the means - the way CEOs engage with the world - are equally important as the end itself. As a result, boards now have so much more to consider when appointing a CEO than they did 20 years ago.

In this mini-series, I’ve been setting out three vital characteristics boards need to look for - and demand - when making this key appointment. They are the ability to:

• connect with people
• connect the inside and outside of the organisation
• connect with the future

In this third and final edition, I look at leadership through the prism of connecting with the future.

The leadership status quo is more powerful than most CEOs realise. That status quo sees them get pinned down by the day-to-day grind: long hours, pressure on diaries, endless meetings and calls. It’s an understandable trap many leaders fall into. But it’s also a cognitive prison that binds leaders to historic stories of success.

Without the space and time to think about the future of their organisations, leaders are more likely to make involuntary assumptions about what is looming. And what the past few disruptive years have shown us is the danger of assumptions.

Just look at the onset of the coronavirus pandemic in January 2020. So many leaders, whether in politics or business, were caught out by their assumptions of how the spread of this virus would play out. If we look back at our perspectives exactly three years ago, most assumptions were based on a non-lockdown world. Then, two months later, we actually went into a lockdown world and so many previously unthinkable aspects of how organisations could operate became a reality.

Some were able to handle this better than others. It brings to mind my interview with Geoff Skingsley , L’Oréal’s UK and Ireland chairman, for my Leadership 2050 podcast about the beginning of the company’s digital transformation a decade ago. This was a time when L’Oréal’s physical retail model was performing well and there was no obvious need to transform. But Skingsley was part of the leadership team told to clear its diaries and head to Silicon Valley to “meet the disruptors” in tech. He told me that by taking this time out to “bathe in disruption”, the team was able to see what might happen in L’Oréal’s industry in the future. Assumptions had been challenged and they were successfully energised in their subsequent pursuit of a digital-first approach. Once COVID hit, the results of connecting with the future in this way spoke for themselves: L’Oréal saw growth in the second half of a pandemic-hit 2020 .

More than ever, boards need to find leaders who are conscious about the future. The status quo assumption about the climate, for example, had been that we would continue to consume natural resources at the same rate. That is clearly not the case and new forms of business leadership are needed in order to make the transition to net zero by 2050.

Leading on from the climate question is also supply chains. For example, in the face of ever more complicated geopolitics, can businesses continue with the same rate of production in low-cost economies like China? And what about the movement of products across borders? In an Oxfordshire supermarket recently, I saw a packet of green beans imported from Peru. Is it really sustainable to put a packet of green beans on a plane from Peru?!

As we contemplate how to transcend these 21st century challenges, what I increasingly see is the leaders most able to connect with the future - and transform it - are the ones who don’t think like normal people.

One of my favourite Leadership 2050 podcast interviews was with David Katz , CEO of Plastic Bank, who saw the problem of plastic waste in oceans and launched a business which actually pays people in poor coastal communities to collect the waste - with the plastic then recycled into new raw materials and sold to manufacturers.

Another, Audette Exel , CEO of the Adara Group, combines the worlds of financial services and international development in order to support people in poverty. As she told me: “Companies that are not purpose-led are not going to be in existence in any significant way within a decade.”

Katz and Exel are leaders who don’t get stuck in today’s problems. Instead, they connect with the future by reframing them as opportunities to do good - for their organisations and for society. Where others see angst, they see evolution and potential. And given the widespread disruption in today’s world, these are the sorts of leaders boards need to be looking towards.

A message from the author

Thank you for reading the 41st edition of the Leadership 2050 newsletter. You may be interested to know why I am writing this newsletter. As a senior fellow of management practice at the University of Oxford’s Sa?d Business School, my research and teaching focuses on how leaders transcend 21st century challenges such as disruptive technology change, the climate crisis and creating diverse and inclusive environments… alongside the ongoing challenge of delivering profitable growth. At Sa?d, I direct the Oxford Advanced Management & Leadership Programme and, in this capacity, work with leaders from many geographies, industries and governments. All this has given me a deep understanding of how good leaders create value - and bad leaders destroy it. One could argue that never before has this topic been so important on a global stage, hence why I am undertaking this work.