A few years ago, an acquaintance of mine, a consultant, told me I would never be relevant or wealthy because I believed in goodness and fairness, and in doing the right thing. ‘You are an outcast, you are in dreamland, fairness does not exist in the business world,’ he said as he walked away, feeling proud of his financial affluence.
Through a friend, I was introduced to INSEAD’s school of International Corporate Governance. Its Chaired Professor, Ludo Van der Heyden, passionately teaches fair process leadership. How wonderful to validate that the values and process of fairness do exist in the business world!
Ludo explains his drive: ‘The first motivation for this was my own sort of sensitivity to fairness and actually unfairness, which was either in the family setting or in larger business or social settings.’ Ludo’s work is based on his own in-depth research and analysis conducted during seven years of factory visits in France and Germany, as well as the research work of his fellow professors Chan Kim and Renee Mauborgne, who examined the issue of lack of fair play especially between headquarters and multinationals.
Two notions are central to Ludo’s approach.
First is the importance of leadership. Fair leadership does not exist if leaders are not fair.
Second is the role of process. ‘In most research, you see only decision-making but you don’t see execution,’ comments Ludo, ‘and that led me to develop and add one more step to the existing literature, which was a step specifically devoted to execution and the unfairness that might arise in execution.’
It is critical in motivating fair process leadership to move away from examining any problems in isolation – very often these are actually symptoms – and look instead to the root cause. The root cause of such problems could be attributed to three different negative factors: lack of fairness or fair play, bad process and bad leadership.
To get good results you need to have a combination of the positives of all three: fair play, good process and great leadership.
If fair leadership is common sense, but isn’t common practice, how can we deploy it in the markets of the Mediterranean, which are mostly dominated by medium and large family businesses and state-owned enterprises? How can we ensure growth, initiate youth employment and attract international investment premised on potential and trust in the governance process and its execution?
In fact, inward international investment offering access to capital and markets would necessitate good governance practices in order to deliver returns and highlight the attractiveness of the investment.
As business and government leaders in the Mediterranean region understand the need to restructure our economies as we seek growth, trade and market access to other regions, we must carefully consider how to deploy the entrepreneurial and leadership values inherent in our culture into a core strength coupled with fair process leadership.
As trading nations, we understand leadership in terms of resilience, crisis management and ‘eat or be eaten’ market rules.
Establishing fair leadership implies market edge, asking the right questions to contextualise risk and define opportunity, understanding potential, creating networks of niche expertise, engaging stakeholders, and appreciating accountability and responsibility.
With a market of 500 million people, producing 10 per cent of global GDP, how many boards in our region could qualify as fair process leaders?
Cyprus hosted Professor Van der Heyden as he delivered a keynote speech on 24 November 2017 to the INSEAD annual alumni gathering.