CEO Activism vs. Moral Leadership

CEO activism does not equal moral leadership
Social, environmental, geopolitical, biological, humanitarian, ethical, and moral issues that were once considered tangential to an organization’s agenda are increasingly viewed as inescapably at the center of it. And while some continue to debate the role of business in society and whether organizational leaders from any sector should or shouldn’t have voiced normative perspectives on societal issues, employees have increasingly given executive leaders little choice. Moral leadership has become a survival skill. If you don’t have a perspective, you’re going to get run over by the very people you employ or serve.
black and white photo of people protesting
A vacuum of moral authority has been created by the lessening influence of cultural institutions and the widespread distrust of governmental agencies. Employees are rightfully turning and yearning for leaders with the courage to use their influence to stand up to those acting with seeming impunity.
The challenge though is that the cost-benefit analysis approach many executives are taught in business school doesn’t serve them well in this arena. Cost-benefit analysis does not scale and can prove an executive rather fickle when the winds change as they so rapidly do and have been.
Today’s corporate executives confronted with navigating difficult social and societal issues need to develop effective ethical and moral leadership frameworks for decision-making that are rooted in their organization’s values and purpose. These decision-making frameworks can help leaders choose when and how to lean into the issues most relevant to their organizations, foster a shared starting point for conversations, and continue to make progress aligned with their purpose, however non-linear that progress might be.
The research in the December 2022 State of Moral Leadership in Business report confirms that the imperative for moral leadership is more urgent than ever. Data collected from 2,500 employees across a variety of sectors in the United States, demonstrates a deep desire to work with and for moral leaders.
Indeed, in organizations with CEOs ranked as top-tier compared to bottom-tier moral leaders, employees are five times more likely to strongly agree that their organization is purpose-inspired. Moreover, in these organizations, employees are twenty times more likely to strongly agree that they can express political and social opinions.
When employees feel enough trust to share these opinions, moral leaders are able to frame the conversations which forge lasting change, avoiding the temptation to move from often justified outrage to demand, and instead pause to first seek a shared understanding. Employees who strongly agree that their CEO creates opportunities for thoughtful dialogue among and between colleagues are actually three times more likely to strongly agree that their organization adapts quickly to internal and external change.