“Half of the MBA students find greed a good thing.” Musings on responsible entrepreneurship and the hand of the leader.

“Half of the MBA students find greed a good thing,” said Thomas Maak yesterday during his lecture with his wife Nicola Pless on responsible leadership. They are both professors and researchers in the field of business ethics. “A lot of business people still believe that the business of business is business. They fit the profile of ‘bottom liners’. Their sole intention is to make profit.”

Also yesterday I had the honour to take part in a jury to choose the ‘Young Antwerp Entrepreneur of the Year’ for the Junior Chamber International (JCI). Four candidates survived the finance indicator based first round. The jury had to assess the leadership capacities of these young entrepreneurs. JCI has a mature and international leadership model called the ‘hand of the leader’. Leaders have to be “learners, managers, ambassadors, visionary, coaches and educators”. The model is neutral. It only deals with the ‘what’, not with the ‘why’ of leadership.

Thomas Maak explained the audience of students and guests that an evolution in leadership is going on. They identify four stages. First only profitability mattered. Then came compliance. A good example is what Jean-Luc Dehaene, former prime minister of Belgium and now president of Dexia, said Wednesday as comment on the bonus of 600.000 EURO for CEO Pierre Mariani: “We followed the rules and the law. So what’s the problem?” (http://bit.ly/gffjAZ).

The third stage of responsible leadership is value based. The organisation defines its own norms and standards. The emerging fourth stage is ‘good corporate citizenship’. Organisations on this level contribute actively to the great challenges of today’s society: poverty, sustainability, diseases, human rights. On these last two levels good leadership combines ethics and effectivity. All indicators show this is becoming the normal way of doing business. CSR initiatives and reports grow exponentially. Studies show that ethics is priority nr. one for international business. “Business ethics is no longer seen as contradictio in terminis,” Maak concluded.

The four entrepreneurs defended their project for the jury with passion. They were examples of true and daring entrepreneurship. Belgium’s risk avoidance and bureaucracy makes us by many standards one of the worst countries for starting a new business. And yet, those four entrepreneurs managed to build a solid company in 5 to 10 years. SuAzio does global market research and consulting for the life science industry. Onetowin is active in business process management and IT personnel. Nexten consults on ICT networks, builds them and is active in solar panels and heath pumps. Finally Projective manages projects in the European financial industry. The four shared professionalism, customer drive, courage and internationalism. But none of them talked about their role in society at large. It made me doubt if ‘entrepreneurship’ and ‘global citizenship’ can go hand in hand.

Nicola Pless studied the responsibility “mindsets” of CEO’s all over the world. She plotted them in a matrix on two dimensions. The intention of leadership can be humanistic or materialistic, and the actions and style of leadership can be one-dimensional or multi-dimensional. We already characterized the bottom liners and their sole focus on profitability. Also materialistic focused but looking at all stakeholders are the strategists. They invest in CSR because of the possible win-win. CSR is for them a driver for growth. Humanistic organisations can be ‘idealists’ or ‘integrators’. ‘Idealists’ focus solely on ‘doing good’. Business is a mean to do good. These are the social entrepreneurs. The last group are the ‘integrators”. These organisations balance all stakeholder interests and integrate them fully. They bring profits and principles together. In his group we find the Bodyshops and Timberlands of this world.

The big question is should JCI have evaluated their four candidates on their humanistic intentions? Are organisations all over the world moving towards a more holistic human approach and will this model become dominant? Are ethics and global citizenship nice or need to have? Should greedy MBA students be ethically brainwashed? According to Pless, 60 to 70 % of the businesses are in the strategy quadrant. This explains the CSR ‘hype’. Is CSR a point of no return for these businesses? Will they stop doing ‘good’ when CSR costs bring no more benefits? Pless and Maak didn’t answer that question.

The jury chose Stefan Dierckx as young Antwerp entrepreneur of the year. “We have a clear focus, are professional and make no compromise,” Stefan explained his success.  Projective has no offices. The employees go together off site once a month to share the results and to learn from each other. They have a clear career approach and give opportunities to young potentials. Each employee has a budget for training and part of the bonus is linked to ‘using that budget’. Once per quarter the employees have coaching meetings. Stefan showed the results of his 360° as proof of his transparent leadership. Idem for the remuneration system. “Everybody in Projective knows my wage and bonus,” said Stefan at the award event yesterday evening. The jury praised Stefan for his open, transparent, focused and lean business approach. All qualities of newnormal leadership.

Someone from the audience asked Maak and Pless if the 4 types of responsible leadership could not be seen as an evolution path: “Entrepreneurs start with a focus on the bottom line and later on include more humanistic intentions in their business.” Maak answered in a nuanced way, as good academics. “Yes, we see evolutions over time. But we also see more and more ‘integrated’ approaches and business models right from the start.”

JCI has four pillars: training, internationalism, networking and community serving. Maybe the award could also take into account this fourth dimension more explicitly in evaluating the young entrepreneurs for the future?

Any comment?

About Koen Marichal

Director Future Leadership Initiative at Antwerp Management School
This entry was posted in Comments & events, English and tagged , , , , , , , , . Bookmark the permalink.

One Response to “Half of the MBA students find greed a good thing.” Musings on responsible entrepreneurship and the hand of the leader.

  1. Change of (business)attitude goes slowly in our society. Unfortunately it is really too ideallistic to expect any transformation overnight within the majority of our students, citizens, managers.
    To act fully in a social and environmental responsible way will take more time.
    For instance in the Amsterdam restauration of ” Paleis op de Dam” our own administration violated severely the targetted 100% use of sustainable CFK wood.

    Although it may seem that things are changing rapidly in our corporations, this is not really true.. Major reason for this in my opinion?..

    …All current leaders (oldschool) within organisations tend to hire their lookalikes. Evenly greedy and conventional. The example of mr Dehaene speaks for itself, and the bonus discussions in our banking industries all point in that same way. Things move slowly in large organisations.

    On the positive site however, there are playingfields where high speeds of change tend to be more possible and allready to be seen:
    Young entrepreneurs with new ideas, new business models and greenfield operations!
    Those are our front leaders who fully incorporate and execute socially responsible businesses.

    Obviously can JCI take this fourth dimension more in account in the coming years!

    It will be their trademarks…

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