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What is Sustainable Leadership?

February 11, 2015

We hear a lot about sustainable business these days and we’re going to hear a lot more. It used to mean a degree of environmental awareness, and maybe a passing nod towards some form of social responsibility. Not any more.

 

After the economic earthquake that shook the corporate world in 2008, many business leaders and commentators were forced to look harder at what ‘sustainable leadership’ is all about.

 

Sustainable business is fundamentally the opposite of short-termism – the ruthless focus on bottom-line performance this month, this quarter, this year. It was one of the highly addictive financial narcotics that produced the crisis.

 

Every time a bank makes a loan, new money is created. In the run up to the financial crisis, banks created huge sums of new money by making loans. In just 7 years, they doubled the amount of money and debt in the economy.

 

It’s easy enough to deliver evidence of high performance – and claim the huge bonuses that are often attached  – when you can simply push the real problems into the future. But the sticky stuff will hit the fan, sooner or later.

 

Very little of the trillion pounds that banks created between 2000-2007 went to businesses outside of the financial sector: 

Lending large sums of money into the property market pushes up the price of houses along with the level of personal debt. Interest has to be paid on all the loans that banks make, and with the debt rising quicker than incomes, eventually some people become unable to keep up with repayments. At this point, they stop repaying their loans, and banks find themselves in danger of going bankrupt. Clearly, this was unsustainable.

 

“The financial crisis of 2007 to 2008 occurred because we failed to constrain the

financial system’s creation of private credit and money.”

 

-Lord Adair Turner, speaking as chair of the Financial Services Authority, 6th February, 2013

 

Millions of words have been written about the causes of a devastating crisis that is still reverberating around the world. In fact, we could reduce all of that scholarly work to just five letters and one word: GREED. The successful companies that rise from the ashes of a thoroughly discredited approach to business will instead build their business on truly sustainable principles.

 

“Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs.”  D & D Meadows, The Limits to Growth, 1972

 

Having explored a little about sustainability and poor leadership this begs the question, what then is sustainable leadership? It’s not jut about leadership in sustainability. It is not just about being the industry leader in sustainability efforts. It is about leading in a sustainable way.

 

Sustainable leadership is based on values that are rooted in environmental and social ethics. The key qualities of a sustainable leader are integrity, mindfulness and sustainability. Tomorrow’s leaders will need to embrace the principles of sustainable development and be able to defend and spread those principles.

 

This is a revolution that has only just begun. The new business paradigm demands radically new business leaders. They will be completely different animals from their predecessors, who took global business to the very edge of the abyss. Instead, tomorrow’s leaders will be able to bring real sustainability into every aspect of their business and personal lives.

 

The first step in this leadership re-engineering process is to look inwards – to better understand ourselves, our values, our goals and motivations and even our definition of ‘success’.

 

We strongly believe that this is the way forward. That’s why we’re working with like-minded people to offer unique bespoke training for Tomorrow’s Leaders.

 

Take a few moments to visit www.transformingtomorrowsleaders.com to learn more.

 

 

Mike is the Founder and Managing Director of Making the Link.  He has delivered training, team events and Keynote speeches to over 40,000 people on topics such as Emotional intelligence, Leadership and Business Improvement. His people-orientated approach has enabled Mike to work with the most demanding and prestigious clients internationally and across a number of sectors. Driven to help Leaders, Managers and Business Owners be more successful. 

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