The FRC and IBE prompt ethical leadership: Ask Gareth Southgate

It’s all over, the World Cup tribalism that was a study in belonging. Now the flag-painted faces are clean, the stadium chanting and pub angst calmed, the passion of victor and vanquished internalised. Our young team of cubs returned as lions, a surge in British pride.

And Gareth Southgate station – renamed for a few days, in glorious English celebratory humour – has gone back to plain old Southgate on the Piccadilly line.

Though he didn’t raise the cup, Gareth Southgate’s legacy for England may well prove to be raising ethical standards.

Getting the job done with decency while respecting the rules, and retaining integrity regardless of others’ less reputable behaviour, he’s set a straightforward example.

Thank you Mr Southgate, it’s timely.
Setting the ethical tone from the top is a critical leadership role, but we’re struggling to see an overload of great examples. Political leaders? Erm… Big business? Hmm… Leading actors and directors? Oh dear…

Yet two big influences, the Financial Reporting Council (FRC) and the Institute of Business Ethics (IBE), call for much stronger leadership of ethics and culture in British business, emphasising how vital this is for commercial success.

The FRC has just launched its new Corporate Governance Code, and the IBE its latest three-yearly survey, Ethics at Work.

The FRC says the Code “places emphasis on businesses building trust by forging strong relationships with key stakeholders. It calls for companies to establish a corporate culture that is aligned with the company purpose, business strategy, promotes integrity and values diversity.” 

The code grew out of an extensive review of the role of culture and the board, and inconvertible evidence of how critical a healthy ethical culture is for long-term performance and sustainable commercial success.

Sir Win Bischoff, Chairman, FRC, said:

“This new Code, in its new shorter and sharper form, and with its overarching theme of trust, is paramount in promoting transparency and integrity in business for society as a whole.”

The IBE’s survey reports some progress, but also some concerning trends, such as greater tolerance for petty fiddling.

“Employees are under more stress of time and workload is increasing the pressure to then cut ethical corners.”

“One in six employees in Europe (16%) say that they have felt some form of pressure to compromise their organisation’s ethical standards.”

“This is a worrying development,” says Philippa Foster Back CBE, Director of the IBE. “These figures should be seen as a warning sign to organisations that they need to be more supportive of their employees when it comes to making ethical decisions.”

Setting the tone from the top

At the FRC’s debate last week, and the IBE’s event previously, the theme of ‘Doing the right thing’ and ‘Setting the tone from the top’ came up repeatedly.

Working on large-scale ethics and values programmes in many sectors over the year, I’ve seen what works and what doesn’t.

The most significant impact is leadership example.

Slow down to see impact: then speed up for fast ethical decisions

Often the most important intervention often is to slow down decisions enough to consider the consequences of actions. Looking at the impacts, learning that each action has a chain reaction.

We help leaders and teams learn to stop and think, to consider the ethical dilemmas, the implications for longer term, the impact of your decisions and actions on others… and then to consider what is the right thing to do.

Then we help them absorb this habit into culture, to speed up ethical decisions. So that it becomes second nature.

One major global bank, tackling a culture that had proven woefully unconscious of ethics, asked employees to put an ethics filter on their decisions:

“What would your mother think?”

Like maternal guidance, leadership certainly sets the tone for ethical behaviour. But there are some risks in a culture being too maternal or paternal – not least that it creates dependency, rather than independent thought, or interdependent action.

What matters is seeing ethics in context, with relevance to your work now and the longer term impact in future.

So an even better prompt for ethical leadership now is:
What would Gareth Southgate do?

Faced with blatant fouls from Columbia, and aggressive tackles by Croatia in the semi, Southgate’s players did not retaliate, reduce to the level of their opponents, or indulge in victim-drama complaining. Instead they upheld their own integrity and got on with play.

After the Croatia game, he said “I’m proud, but I can’t make the players feel any better” After respecting a few minutes’ reflection to come to terms with the gut-punch result, their manager gave each player a bear hug and lifted them back up on their feet. Implied to all of us was: hold your head up, get on with the job, and onto the next challenge.

Asked about the secret of us getting so far, he answered: “Owning the process”

Gareth Southgate’s style of decency, humility and looking out for each other prompted a twitterswirl of #GarethSouthgateWould.

#GarethSouthgateWould… give you a lift to the airport and wouldn’t accept petrol money.

#GarethSouthgateWould… pop in to make sure your nan’s ok while you’re on holiday, get her a bit of shopping in and sit with her to watch Countdown

Has #GarethSouthgateWould… has reset national ethical standards?

Raising ethical standards may not be the World Cup, but still a fine legacy for British business.

The FRC’s requirement – to establish a corporate culture that is aligned with the company purpose, business strategy, promotes integrity and values diversity – is not easy.

Responding to this will require reflection in boardrooms across the land on how to set a new standard for leadership of culture .

No face-paints or chanting: this requires belonging based on ethos.

How will you instill an ethical culture in your business?

Call us to talk through how to align purpose, strategy and cultureArrange an ethical risk assessment, or workshop for Board preparedness.

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