How to Be an Effective Leader in the Trump Era

By Donald Lee Sheppard, August 14, 2018

This may sound like some form of corporate utopia, a nirvana for HR executives and MBA scholars. But it’s not. Examples of values-based CEOs who achieved outstanding success for their companies are not just easy to find—they’re prominent in the business media.

I’m speaking of people like Apple CEO Tim Cook, who agreed to forfeit half of his annual compensation in 2013 if Apple failed to outperform other S&P 500 companies. The promise cost him $4 million in income that year. And Whole Foods CEO John Mackey wrote a book titled Conscious Capitalism: Liberating the Heroic Spirit of Business, in which he proposed that American businesses must serve the interests of all major stakeholders, from customers, employees and investors to suppliers and communities. Along the way, he says, they should also make every effort to protect the environment. Mackey claims he has followed this dictum since co-founding his firm thirty-five years ago—a company, by the way, that he sold to Amazon for $13.7 billion in 2017.

Or consider this for proof: In 2015, the Harvard Business Review published a book titled Return on Character: The Real Reason Leaders and Their Companies Win, in which the author, Dr. Fred Kiel, collected data on eighty-four CEOs from their staff and salaried employees. He looked for confidential assessments of each CEO’s value system—fairness, honesty, openness and all the other qualities I’ve been talking about. Then he cross-referenced the long-term performance of each company whose CEO rated highly for values and integrity against those whose ratings were lower.

The results were dramatic. Kiel discovered that companies with the highest values and integrity rating scored annual returns averaging 9.4 percent while those in the lower third had a yield of just 1.9 percent. Let’s call the difference between those two figures an impressive dividend earned as a result of enlightened CEOs acting not just out of integrity, but also recognizing the large number of contributors to their company’s operations and success.

“You know the best thing about running things with a lot of integrity?” one highly admired CEO says. “It makes things easier. We don’t question ourselves, and nobody asks, ‘Should we, or shouldn’t we?’ There is no second-guessing and no hiding the truth, because it’s always out there to see. Life becomes simple, and you live and work in peace.”

And, I might add, if you and your reputation are associated with your business—say, a chain of hotels, for example—you might never have to deal with changing the company name.

Donald Lee SheppardDonald Sheppard, a retired entrepreneur and business executive, is the author of “The Dividends of Decency: How Values-Based Leadership Will Help Business Flourish in Trump’s America.”

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