COEUR
DE LION
ARTICLE BY MARC STIGTER, AUTHOR - CRITICAL MANAGEMENT GROUP
Courage is what all other virtues depend on as a foundation. Without courage, all of the other virtues lose their meaning. People on Boards may have a moral compass, they may have ability, may have understanding and may even have desire, but all of these qualities become meaningless if they do not display courage.
Aristotle famously said that courage is the first of human qualities because it’s the quality that guarantees the others. We believe that courage is the most important virtue in governance because without daring, directors and their boards won’t make a difference. Many directors, in times of crisis, confusion or great change, simply are paralysed. Cognitively, emotionally, behaviourally frozen by fear and an inability to act. So what then
is courage? Courage can be interpreted as a habitual disposition to take whatever pains may be involved in doing what we ought to do. Habitually “taking whatever pains” clearly is the opposite of “remaining comfortable”. In other words, courage and comfort will never be friends. If boards are comfortable, chances are their directors aren’t learning, growing or forging new paths. Boards that dare, display courage when directing their organisations towards new paths often through uncertain and turbulent times and often facing adversity and criticism along the way. These courageous attributes are the specific mindsets, character traits, values, beliefs and convictions that individual directors need to display based on our research. On the surface, these attributes could be perceived as straightforward; not for a second do we believe that they are. It takes courage for
directors to let go of the familiar and to be open to expanding their horizons. Lord Chesterfield, who remains best remembered for the hundreds of witty and wise letters he wrote to his son in the 18th century, could not have captured it better by writing: “Man cannot discover new oceans unless he has the courage to lose sight of the shore”. Losing sight of the shore equals letting go of the familiar and being open to experience. Being open to experience is a courageous character quality and is a director’s ability to be imaginative, nonconforming and unconventional. From our observations, courageous directors are curious and inquisitive and are oriented to creating imaginative and broadened solutions by seeing, thinking, feeling, and acting differently. Not surprisingly, they often act decidedly unconventional; countering what most people would consider safe behaviour within a boardroom.
“Go back?" he thought. "No good at all! Go sideways? Impossible! Go forward? Only thing to do! On we go!" So up he got, and trotted along with his little sword held in front of him and one hand feeling the wall, and his heart all of a patter and a pitter.” This extract from The Hobbit by J.R.R. Tolkien captures another character trait that is needed for directors to display courageous behaviour. Academics call this quality conscientiousness. Conscientious directors feel duty-bound to act in the face of adversity. In such situations,
conscientious directors act because they feel it is the right thing to do. They persevere in their duty by displaying great tenacity and persistence. Research has found that conscientiousness actually increases with age. With the average age of directors steadily increasing and currently being around 64, the display of this courageous trait should therefore come a bit easier.
“Wells Fargo directors: Don’t blame us. Blame former executives & CEO” was a headline in the San Francisco Chronicle in 2017 following an investigation and release of a report that
looked into the creation of up to two million unauthorised accounts in the names of customers. Amazingly, according to the article, “the board did not even offer a cursory attempt to assume some measure of responsibility for the company’s behaviour. Not even
a “We’re sorry that we didn’t do a better job overseeing Wells Fargo.” This level of denial happens in any and every geography even including the U.K. In governance life, directors can easily feel out of control and when things go wrong find others to blame: the CEO, the
management team, the employees, the sub-contractors, the markets, the global economy, the shareholders, the suppliers, the media, the government, the unions, the competitors, or even the consumers. Sure, it is simple within a governance environment to dodge responsibility and to blame forces outside the boardroom for everything. But courageous directors are the ones who believe they have power over events regardless of variables at play. They strongly believe in their own ability in taking control of variables, positively influencing situations and securing the right outcomes. And taking responsibility if things go wrong!
There is an experiment where ten school kids are placed in a room and are shown a card with three lines of varying length drawn on it. The students are told to raise their hands when the instructor points to the longest line. But nine students have been told beforehand to actually raise their hands when the instructor points to the second longest line. One student is unaware of this and is the stooge. When the instructor points to the longest line, the usual
reaction of the stooge is to raise his or her hand, look around, but to then quickly pull it back down when realising that he or she is the only one with a raised hand. In repeated tests, this
happened 75 percent of the time with the researchers concluding that the majority of students will rather go along with the crowd even when that is opposed to their
own individual beliefs. If the same experiment were to be conducted with corporate directors, chances are that the outcome would be very much the same. Based on our observations, we feel that many directors take a back seat and don’t stand up or speak out for their own beliefs when facing opposing views by a majority of fellow board members.
It is daring to stand up for your principles and beliefs, for what you know is right in the face of opposition. Or,
the courage to actually sit down and listen, as Winston Churchill pointed out. Or, not being afraid to say: “I don’t know or I don’t understand”
In other words, many directors don’t dare to follow their heart, unfortunately. But everything in life starts with Self. Self-courage is therefore perhaps the most important trait for directors. It is the courage to follow your heart and your intuition. It is daring to stand up for your principles and beliefs, for what you know is right in the face of opposition. Or, the courage to actually sit down and listen as Winston Churchill pointed out. Or, not being afraid to say: “I don’t know or I don’t understand”.
We now turn from character traits to the mindsets of a courageous director. One mindset that we observe in courageous directors is self-belief. Selfbelief or self-efficacy essentially means confidence in yourself and your ability to achieve desired outcomes. Directors who regard themselves as highly efficacious, see and think differently from those who perceive themselves as inefficacious. “They produce their own future, rather than simply foretell it”, according to psychologist Albert Bandura from Stanford University. Researchers like Bandura have established linkages between self-efficacy and courage. Within a governance context, the level of self-belief impacts whether directors
think in self-enhancing or self debilitating ways. For instance, it impacts how well directors motivate themselves and persevere in the face of difficulties; how they deal with stress and threatening situations; and the choices they make at critical decision points. However, directors shouldn’t confuse self-belief and confidence with ego. The positional power of directors can easily make some of them conceited. Boards composed of ‘prima donna’ directors are never effective. What we observe is that directors displaying ego driven behaviours are not courageous but dysfunctional. We observe that directors with oversized egos often try to dominate the board discussion by ‘showing off’ their ‘wisdom’ and bragging about their own, often irrelevant, previous experiences. An intriguing
observation is that such directors often lack self-awareness by failing to realise how their self-centred rambling is affecting the people around them who are experiencing it.
Optimism is often touted as a important quality of leaders. There is this assumption that people just need to see directors at the helm that can model for them that everything will work out, that everything will be ok. But optimism as a leadership disposition is overrated, we believe, particularly within the boardroom. As we know from neurosciences and social sciences people are more optimistic than realistic. On average, we expect things to turn out
better than they wind up being. This belief that the future will be much better than the past and present is known as the optimism bias. Within a governance context, optimism bias is a cognitive bias that causes directors to believe that they are at a lesser risk of experiencing a negative event compared to others.
‘Prima donna’ directors are never effective. What we observe is that directors displaying ego-driven behaviours
are not courageous but dysfunctional. We observe that directors with oversized egos often try to dominate the board discussion by ‘showing off’ their ‘wisdom’
We argue, therefore, that optimism is not a courageous disposition but a naïve one.
Our observation is that we don’t need directors who are full of optimism. Instead, “we need leaders who are full of hope, not purveyors of plastic smiles suggesting a lame optimism”, as some critics point out. One of these critics is Jonathan Sacks who published an article in The Times titled: “Optimism is all very well, but it takes courage to hope”.
In this article, the critical difference between optimism and hope is explained: “Optimism is the belief that things will get better. Hope is the belief that, if we work hard enough, we can make things better. Between them lies all the difference in the world. Optimism is a passive virtue, hope an active one.
It needs no courage, only a certain naiveté, to be an optimist. It needs a great deal of courage to have hope.” In other words, optimism claims everything will be all right despite reality. Hope accepts it and is focused on changing current reality by working on important positive future outcomes. What we observe is that when directors don’t have hope, they are less likely to let go of the familiar and less likely to expand their horizons about future opportunities. This observation is backed by researchers who argue that if you don’t have hope, you are more likely to employ ‘mastery goals’ or choose simple, attainable tasks that aren’t challenging and don’t help you grow. Let’s conclude this section on hope and courage by coming back to Aristotle who informs: “even though not every hopeful person is courageous, every courageous person is hopeful. Hopefulness creates confidence, which, if derived from the right sources, can lead to the virtue of courage.” “More than education, more than experience, more than training, a person’s level of resilience will determine
who succeeds and who fails. That’s true in the cancer ward, it’s true in the Olympics, and it’s true in the boardroom”. This quote is arguably even more relevant today as it was in 2002 when it appeared in a Harvard Business Review article by Diane Coutu. The next 15 or 20 years are going to be even faster moving and more transformative than the years we lived through since 2002. A central theme of our book Boards That Dare is that in its scale, scope, and complexity, the transformation will be unlike anything humankind has experienced before. Directors and their companies will be facing increasingly profound global, macro-economic, geopolitical, environmental and technological disruption. We foresee that directors will be facing bigger and bolder activism, not only from shareholders but also from consumers and a wider range of interest groups. We also suspect that directors increasingly will have to deal with the volatility and social change that has given rise to populism, not only in terms of anti-government movements, but also in terms of increased anti corporate movements. For directors to act with courage under such transformative forces, they must be not only efficacious and hopeful but also resilient to overcome any setbacks. Resilience, therefore, is about the capability to adapt well in the face of adversity, loss and failures, and to bounce back and thrive again. We see it as a crucial characteristic of transformative directors; one that must be cultivated to avoid directors becoming a hostage to events and forces around them, or even to themselves. It does take courage to withstand disruptive shocks, manage complexity, reenergise, recover
and even capitalise on ever faster-moving and more transformative forces.
“It’s not always easy to do the right thing. But, doing the right thing makes you strong, it builds character, it forces you to make decisions based upon your beliefs and not what other people think. In life, and in business, you have to stand for what you believe in and sometimes you have to stand alone. But, what makes you a leader is having the courage of
your convictions.” This capturing quote doesn’t come from the likes of Steve Jobs, Bill Gates or Richard Branson. These words are by Dana Elaine Owens, better known as Queen Latifah, one of hiphop’s pioneer feminists.
Boards That Dare: How to Future-proof Today’s
Corporate Boards is by Marc Stigter and Cary Cooper,
published by Bloomsbury.
FOR FURTHER INFO
www.bloomsbury.com/us/
boards-that-dare-9781472938060/