President Barak Obama signed into law a bill expanding the government’s regulatory reach into U.S. financial markets. The new powers of oversight are intended to stave off a repeat of the financial collapse of 2008, and indicate deepened distrust of corporate leadership. It’s clear that corporate leaders won’t be enjoying as many decision-making liberties.
The issue of responsible leadership seems to resurface after every corporate scandal (remember Enron?), and inspires renewed discussion around ethics and the MBA. With the onset of this latest financial crisis — and an increasingly interdependent economy — we find ourselves asking a familiar question: What are companies doing to ensure that the next generation of corporate leaders handles our economy responsibly?
“Responsible leadership” is perhaps even more challenging to articulate. Running a responsible business means more than just being philanthropic, sustainable and green — centrepieces of the popular Corporate Social Responsibility movement. It also means taking calculated risks, creating value for stakeholders and driving profit.
Strategy consulting company, Hitachi’s consultants need to know what risk is acceptable and what isn’t. New Hitachi hires undergo 90 to 100 training hours a year selected with the guidance of an assigned career advisor. New hires also begin their careers as part of a generalist “consulting core” organization that both exposes them to the firm’s several specialized practice units, and familiarizes them with Hitachi’s project management, and decision-making methodology.
Sumera Hassan, senior director of HR & Global Recruitment at Revlon, says its philosophy is to give MBA hires the depth and breadth of experience to understand the impact of decisions across all stakeholders.
Revlon rotates its high performers through high-impact parts of the organization towards more senior roles. “We’ll hire [some] people directly into brand marketing, and then when we feel someone’s ready, we’ll tap them on the shoulder for something else.” The true leaders, according to Hassan, are those who embrace these changes; not those who fuss about moving from the specific field they may have studied for.