Management » Should a C-suite executive know how much the business pays its lowest earners?

I came across this quote on compassion on the website of wealth management firm Brighton Jones: “Of all the positive emotions that drive emotional well-being, compassion tops the list”.

That quote got me thinking: is there a place for compassion in the world of business?

The life of a CFO or other C-suite executive is challenging as it is and although I have never been one myself I can only imagine the enormous burden of managing, at the highest levels, and juggling all that responsibility while keeping an eye on profitability, adhering to governance, relating with various stakeholders, dealing with CSR and so on and so forth.

Asking them to then balance all the above with their own individual commitments can be a heavy workload. I also know that many would immediately point to the high wages earned by those at this level as a good trade-off.

Yet are we asking a lot from them if we also expect them to know granular details, such as the salary package they offer to the lowest level earners within their organisations?

My short answer would be, yes, they should know, and I have a couple of reasons for making that case.

In the first place, business leaders regularly must toe the line between maintaining control over employees and showing adequate compassion. I have defined compassion here as an individual’s ability to understand the emotional state of another. Perpetual worry over finance will affect the emotional wellbeing of anyone.

Secondly, two recent events in the United States have, in my view, brought this issue firmly to the table. Not too long ago, Bernie Sanders; one of the Democrats seeking to become the next US President gave a passionate speech to shareholders and indeed the CEO of Walmart. He asked that they consider increasing the current “starvation wages” they pay their front-line employees. In a separate incident, I was intrigued by an exchange between U.S congresswoman Katie Porter and The CEO of JP Morgan where he struggled to explain how a low paid bank clerk within his organisation could live a healthy happy life based on her monthly paycheque.

So, is there a place for compassion in our very busy and result-driven corporate world? One school of thought is that business owners should endeavour to demonstrate compassion not just to customers and suppliers but employees too and that is without coming across as weak or easily manipulated.

Do I need to be Compassionate?

In his article for www.medium.com titled “Compassion Isn’t a Soft Leadership Skill, it’s a Crucial Power Skill”, Lionel Valdellon described the difference between Empathy and Compassion  thus

“While empathy is the tendency to feel others’ emotions and take them on as if you were feeling them, compassion is the intent to contribute to the happiness and well-being of others. Compassion, therefore, is more proactive, which means we can make a habit of it”

The value of being compassionate cannot be overemphasised and we all have the capacity to learn it. It is a skill that is worth paying attention to and developing into a habit.

In reality, a business owner will benefit from compassion by having around him or her stakeholders who would value the positive environment compassion creates.

That dovetails nicely into how not to show compassion.

It still surprises me that in this day and age that senior executives need outsiders to appeal to them to do the right thing. There is something not right about paying your employees a wage that keeps them impoverished. How many executives or directors actually take an hour of their time each month to ask themselves the question: “… can I live on what I pay my most junior employees”?

It’s not a difficult question unless of course, you are afraid of the answer you would likely get.

Income and economic inequality remain a big factor in the developed world and it is astonishing that organisations, especially large businesses, can somehow manage to deflect attention using their powerful media tools and structures.

If senior executives of organisations don’t understand what equality or fairness means how can they honestly address issues of inequality within their own organisations?

The answer is, CEOs or senior executives, sadly, most of the time, don’t understand what equality of fairness means. The reason is their detachment from reality and the lack of knowledge about the living conditions of those who work for them.

I do get the argument that the higher you go the more you are distracted with strategy and looking at the bigger picture. In addition, senior executives rely on middle managers to be able to read the mood of their teams and filter that information upwards. In reality, though this is not always the case and can feel like a “cop out”.

Is leadership not about taking time to walk the floor?, earn the trust of the employees so you can hear the truth?, show compassion and when you stop that employee and ask “How are you”, be prepared to listen attentively and to hear the truth no matter how hard that would be.

Most of all we need to aspire to arrive at a place where leadership knows and wants to know how much they pay to the lowest earners and we do not, via the channel of wilful ignorance, continue to perpetuate a culture of the working poor.