Sustainable and leadership are two buzz words being combined in all sorts of contexts. How well do these concepts fit together and what does sustainable leadership really mean? We read articles on this topic, more developmental programs for sustainable leaders are springing up, and consultancies and job roles are being created with sustainable leadership in the title. Even Macquarie Graduate School of Management has established a research institute focused on sustainable leadership. What lies behind these trendy terms?
Clearly, organisations are becoming aware of the need to shift to more sustainable environmental and social practices. They are also aware of the importance of leadership in enhancing business performance and attracting a diminishing talent pool. But words and job titles alone are not the answer.
Academics aren't helping to clarify sustainable leadership either, with more than 300 definitions of both terms in the literature. For many, sustainability simply signals care of the environment and possibly greater social responsibility, while leadership often has connotations of the personal characteristics of individuals in leadership positions. Putting these ideas about leadership and sustainability together creates an incongruity - as if sustainable leadership is about certain individuals caring for the environment and society.
Sustainable leadership starts with a complete rethink for most managers. The first step is to look at organisations as systems with leaders and followers. There are clearly other elements in a leadership system beyond the people, although these emerge from the way that people interact. The vision, the ethics, how people are treated and the organisational culture all contribute to the leadership system. Sadly, most managers are so busy looking at the bottom line and playing up to their own leaders that they fail to notice the other important elements that contribute to the system's survival.
Both leadership and sustainability are concerned with the future. Sustainability is about satisfying the needs of the present without compromising the needs and rights of generations to come. Leadership is about steering organisations towards goals and achievements. It follows that sustainable leadership refers to achieving goals without exploiting generational entitlements.
Sustainable leadership begins with making managers aware of about 20 elements that underpin sustainable organisational performance. Some form foundations that can be implemented immediately, such as creating a shared vision and adopting a long-term perspective. Among the foundations are decisions to be environmentally friendly and socially responsible. Once the basic principles are in place, they create higher-level factors including staff engagement, innovation, a strong culture, trust and loyalty.
All these elements have an affect on brand and reputation, customer satisfaction, financial performance and, ultimately, to long-term shareholder value and sustainability. Which of the elements is most important and how they should be combined still requires investigation. However, published research supports certain practices over others for creating sustainable leadership.
Many successful organisations have already adopted sustainable leadership principles. Westpac bank and Insurance Australia Group are moving in this direction - a magnificent achievement for publicly listed companies that are potentially at the mercy of the short-term financial capital markets. Many privately held firms practise sustainable leadership, and globally there are public and private companies practising sustainable leadership.
Nonetheless, there are organisations that are not yet practising sustainable leadership. A big challenge for consultants and researchers is to understand why managers who know better resist sustainable leadership practices. Perhaps they will ultimately be pressured to adopt these principles by shareholders, customers and other stakeholders.
Professor Gayle Avery is Director of the Institute for Sustainable Leadership.
Fairfax Business Media