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Corporate governance: Keep ’em keen

Fresh-faced graduates joining the company always used to be a bit of a
mystery. Grand schemes were run to ensure that they were all, more or less,
facing the same way in the corporate structure. But, as with all generational
issues, people always felt they didn’t quite know what really motivated this
young group of new recruits.

For many, this didn’t matter. One of the best new books gathering insights
into leadership styles from a range of successful people makes the point that
“few of our leaders could claim to have a career plan with the ultimate aim of
leadership in some form”. The book, What do leaders really do? goes on to make
the rather reassuring suggestion that “for most, leadership was an accidental
by-product of their talents, their drive, their beliefs and in some cases, was
helped along by good fortune”.

This is, as we all know from any business experience, how things often work.
People find their feet, or their niche and, happily self-motivated by this
discovery, power ahead happy in their task. It is an exuberant truth.

But there is another side. And it is reflected in innumerable surveys of just
how over-worked and stressed the junior end of the employment market is. One of
the most recent comes from the online audit recruitment firm, CareersinAudit. It
is called Walking the Work-Life Tightrope and is based on accountants across
Europe. Some of the findings are the usual stuff. People are tired. They feel
under pressure, suffer from stress and are having to deal with significant
weight gain, or weight loss. There are real worries, from the employers’
position as well. Around 43% of accountants are working more than 50 hours a
week, while 17% work 60 hours or more. Worse still, 77% felt that their career
progression would be hindered if they gave a greater priority to personal
interests. And 65% thought that being a workaholic increased their chance of
being promoted.

That is the downside of being in a competitive environment and one where
commitment to the business is measured by how much family life or leisure time
you are seen to be giving up. This is the bad side. And this is the side that
large enterprises need to be wary about. Many more people are now starting to
accept that this sort of life may give you good experience early on, but after a
few years, when real family life comes upon them, they expect to work for
themselves or in a business environment where satisfaction comes higher than
sacrifice. It is a growing trend and one which large organisations can no longer
ignore. Global companies need to ensure that bright, young employees do not feel
antagonism towards their workplace. It doesn’t work anymore.

The other factors are the growing indications that a generation is now moving
through the career cycle which expects sustainability to be at the heart of the
organisation. That means they expect the organisation to behave in a sensible
way towards customers, suppliers and employees equally. And companies cannot
avoid this trend. If they do, then they simply do not get the graduate or
professionally-qualified intake they need to remain competitive. When Shell
famously decided it should dump its redundant Brent Spar oil platform out in
mid-ocean, the flak the company took was terrific. Their name was tarnished for
years. It did not matter that, in the end, environmentalists agreed that what
Shell wanted to do was environmentally the best thing to do when all the factors
were weighed up. The most significant impact of the entire episode was that, as
the industry believes, the company lost five years of recruiting the best
graduates. People simply went elsewhere.

Companies need to take this into account, and some are doing so. It is no
surprise to come across, for example, PricewaterhouseCoopers making the best of
its sustainability credentials in its commentary on its annual results last
month. Its UK chairman Kieran Poynter is a delightful character, but doesn’t
look like the sort of chap who would sign up to the idea of sustainability. But
PwC has recognised the speed with which the world is moving in that direction.
“In common with many large organisations, we have seen a step change in the
scope and significance of corporate responsibility and sustainability issues in
the past 12 to 18 months,” he said. And then went on to point out that “The pace
of change is accelerating and many corporate responsibility and sustainability
issues now have a material cost attached to them.”

His conclusions are inescapable. “This starts with our people,” he said, “and
we have devoted significant resources to building deep understanding of the
issues and challenges relating to sustainability and climate change.” The
connection between success and taking a more sensible view is understood. “Our
focus on sustainable development gives me great confidence in the future success
of the firm,” he said. Quite remarkable really. But true.

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