Behind the unending stream of headlines about executive malfeasance, there’s a lot of thought and action going on in progressive quarters about how to improve leadership training so that business can perform better. Writing in the Stanford Social Innovation Review, Andrew J. Hoffman offers insights into how management schooling for MBAs must change.
From the Editor
As income inequality continues to grow as a major social, political, and economic topic, the Economic Policy Institute has added fuel to the fire with its latest report on the pay of chief executives at the top 350 American companies. EPI finds that on average, the top executives earned 312 times more than workers in 2017. The heads of the largest companies received an average pay rise of 17.6%, taking home an average of $18.9 million in compensation.
A company’s ethical achievements are increased eleven-fold when employees are encouraged to base their decisions on the values and standards of the business. That’s the key finding of a new survey by the Ethics & Compliance Initiative, an alliance of organizations committed to business best practice. The ethics group lists the benefits of company programs that go beyond bare minimum standards of responsible conduct in the second installment of its Global Business Ethics Survey.
“Political polarization, voter tribalism and recent, fervent social movements like #grabyourwallet, #MeToo, and #TimesUp have changed the face of brand engagement and consumer loyalty in virtually every brand sector this year.” So writes Robert Passikoff, the founder and president of Brand Keys, in a MediaPost.com op-ed.
Workers are getting increased scrutiny from an unexpected quarter: investors. A group of international investors managing more than $12 trillion has written to 500 of the world’s top companies, calling for more information about the treatment of their employees, reports Reuters.
Brands that have been strongly supportive of LGBTQ+ rights during Pride Month (June) are making commitments for year-round initiatives. And some of them are not the usual suspects. For example, the online gaming community, not known for its inclusivity, now includes ongoing efforts by Twitch, Amazon’s gaming platform.
Here’s some numbers to think about: the 54 percent of the world population currently living in urban areas will rise to 66 percent by 2050, according to the UN. By 2030, the UN predicts a global shortfall in the global water supply of 40 percent. Problem: how is safe water to be made available in this massively built up urban environment? In response, “waterpreneurs” from over 25 countries have signed up for the Imagine H2O Urban Water Scarcity Challenge, an initiative that offers up to $1 million in awards and follow-up investment for solutions.
Unilever, home of over 400 brands and one of the world’s largest advertisers ($7 billion annually), has called a halt to its use of influencer marketers who buy followers.
The falling costs of wind and solar power are driving unprecedented interest from investors. The numbers tell the story: the International Energy Agency reports that in 2016, $297 billion was invested in renewable energy, more than twice the $143 billion backing new coal, gas, fuel oil, and nuclear power plants.
“You didn’t learn this in business school,” writes Daryl Brewster, CEO of CECP: The CEO Force for Good. Brewster explains that “few of today’s CEOs earned their job because they were socially responsible and spoke out on hot topics. Yet key stakeholders increasingly want to know where companies and CEOs stand on critical social issues.
Activists can build the social support necessary for products to flourish—that’s the thesis of an article from the University of Michigan’s Erb Institute/Business for Sustainability. “When groups choose to back a new product or service, it is generally because they view it as alleviating a social and/or environmental problem, writes Joceylyn Leitzinger. “For many established companies and aspiring entrepreneurs, activist-supported industries and markets offer attractive investment opportunities.
With the resignation of Campbell Soup Company CEO Denise Morrison, 23 female executives remain at the top of publicly traded companies on the S&P 500 index. At index 500 companies, 45 percent of employees are women, but just 37 percent of midlevel managers and 27 percent of senior managers are women, according to Catalyst, a consulting and research firm focused on women in leadership. On the plus side, Stacey Cunningham has been appointed President of the NY Stock Exchange, the first woman to hold that post.
Long-term investment strategy used to be the approach of a one financial superstar, Warren Buffet, and a few staid firms. No more. A new book, Go Long: Why Long-Term Thinking is Your Best Short-Term Strategy, describes an increasing focus on taking the long-view among companies and investors alike.
In a surprising finding, researchers report that female and male chief executives of public companies are paid about the same. “Revisiting the Gender Gap in CEO Compensation” looked at compensation for corporate leaders at 2,282 companies from 1996 to 2014, and found no “significant difference.” The study’s authors suggest that the CEO pay gap may have closed up because chief executives of public companies are so prominent. “We think it is a visibility issue,” co-author Vishal K.
“A stalled revolution”—that’s what the Center for American Progress called women’s professional advancement in a 2017 report, “The Women’s Leadership Gap.” Whitney Wolfe Herd, cofounder and CEO of Bumble, calls up this conclusion as the jumping off point for her blog, “The Business Case (and Plan) for Gender Equality.” She recites the dismal stats (“women held only 18% of board seats
What does a startup need to know about CSR? How does including a “give back” element in its mission build brand trust, loyalty, and ultimately, sales? Can CSR be used authentically as a tool that drives scale? Charlie Wright, co-founder of Eventerprise, has some answers to those questions, based on a social project called “Africa’s Got Digital Talent” embedded in his business.
“Why don’t we get credit for all the good things we do?” asked a CEO of Mark Kramer. As a cofounder and a managing director of the social-impact consulting firm FSG and a lecturer at Harvard Business School, Kramer’s answer in the Harvard Business Review sounds authoritative: companies err in using a one-size-fits-all strategy in communications.
The many elements of a company’s supply chain make it a challenge to organize. Where to start, how to connect all the moving parts, and, in integrating sustainability, how to ensure best practices? DNV GL, a global quality assurance and risk management company, recently surveyed its customers in Europe, Asia, and the Americas on supply chain sustainability. The company identified 60 companies that it considers to be leaders.