Innovating Leadership:
Co-Creating Our Future

Resources:

Our host Maureen Metcalf posts a newsletter every week on LinkedIn. You can subscribe here.

Maureen’s latest book is Innovative Leadership & Followership in the Age of AI. You’ll find details about it at https://bit.ly/LeaderInAI, or check out the Kindle version at https://amzn.to/44buVz8. The audiobook version is now available at  https://amzn.to/4dTCleZ.

Her other 10 books are available on Amazon here.

Books we’re reading for fun or personal development right now include:

• To Stop a Tyrant by Ira Chaleff, on how leaders become tyrants and their types of followers, is in hardback on Amazon at https://amzn.to/3W5XDys and on Kindle at https://amzn.to/420Zvwc. An audiobook edition is coming soon. 
• Bedtime Stories for Managers, a collection of short essays from Henry Mintzberg; it’s in paperback at https://amzn.to/4hl6gOb, and Kindle at https://amzn.to/3PYmSiX. 
• Take Back Your Power: 10 New Rules for Women at Work by Ancestry CEO Deb Liu, on how to overcome the obstacles women still face in the workplace – especially in tech. It’s in hardback at https://amzn.to/47OUO9E, and audio at https://amzn.to/3Y6EmOQ. 
• Covert Cows and Chick-fil-A by Steve Robinson; it’s available in hardback at https://amzn.to/460LnmQ, on Kindle at https://amzn.to/3RVXhZs, and as an audiobook at https://amzn.to/3xPjBgn.  

NOTE: As an Amazon partner, we may make a small commission from books you buy through these links

Other episodes you’ll enjoy:

Guest(s):

Guest(s) Bio:

Jonathan Gosling is an Emeritus Professor at Exeter University and Founder and Director at Pelumbra. He was co-founder of the One Planet MBA and is the Lead Faculty with the Forward Institute in the UK. He co-founded the ‘RoundTables’ programme with Henry Mintzberg in 2006.

Henry Mintzberg is a leading expert on managing, organising, and strategy. Author of many books and articles, he co-founded and is a key faculty member of the ‘Roundtables for Experienced Managers’ programme. He’s also an avid collector of beaver sculptures: https://mintzberg.org/sculptures.

Transcript
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Maureen: [00:00:00] This is innovating leadership, co creating our future. I’m your host, Maureen Metcalf, founder and CEO of the Innovative Leadership Institute, where we help leaders become future ready. We’re recording today at the 26th International Leadership Association Global Conference in person. Helping us in this mission today are Henry Mintzberg and Jonathan Gosling, and we’ll be talking about Corporate Social Responsibility 2.

0, rebalancing society, and truth telling, all in about a half hour. Welcome, Henry and Jonathan.

Jonathan: Nice to be here. Yeah, thank you very much. Pleasure.

Maureen: Henry, can you remind us just briefly about the idea of rebalancing society?

Henry: To me, a A balanced society, a healthy society, balances three sectors, not two. It balances government, the public sector, which is respected, the private sector, which is responsible, and what I call plural sector or civil society, namely the community sector, which [00:01:00] is robust.

And healthy societies, like the Scandinavian ones, for example, maintain that balance. You go out of balance either by favoring one sector or the other. Communism in China favors the public sector. America is out of balance on the side of the private sector. Government’s been weakened, and lobbying has gone up enormously.

And with the Citizens United decision some years ago, the lobbying and the capacity to get the vote Politicians, to give attention to your concerns, to businesses concerns, has gone up enormously. And community has been on the demise for a long time. Not because of any particular factor, but more because of technology that takes us away from community.

Because of this kind of effect in many countries, they’ve gone populist, which to me means plural sector interests. For example, in populism in Turkey and Iran means religious influence, and in [00:02:00] Russia it means nationalist influence. But it’s catering to particular communities. Our Western democracies have, for many years, swung like a pendulum between left and right, namely between the power of government and the power of business.

And that’s led to a kind of paralysis in the center. Now, I think the liberal democracies have moved generally more right. There are some left wing governments, but they’ve generally moved more right. But either way, is imbalanced. And that’s what concerns me now. I think the election has demonstrated how upset many Americans who feel beleaguered are.

They’re beleaguered because they feel squeezed between the expenses they have to pay and the income they earn. Their incomes haven’t been going up. as much as the inflation has caused their expenses to go up. So they find themselves squeezed, and they believe that Donald Trump might help them. Now, just to add one other little element, or big element What?

Trump benefits [00:03:00] business. So Musk believes, and the stock market believes, that this election was good for business. I think it might turn out to be the opposite, because if Donald Trump doesn’t deliver to the belabored people of America, or to the people who feel left out, and feel squeezed, then he’s gonna have a lot of trouble within two years, because there’d be another Congressional, particularly House, election going on.

So it may be in business’s interest. To address the issue of imbalance, and not see it as just beneficial to themselves.

Maureen: Jonathan, I want to invite you in to either build or disagree with Henry, either way.

Jonathan: I think what lies behind what Henry was saying about Amson, comparing this to different countries, is really talking about capture.

of power and influence by specific interests. And of course, the interests of business are much easier to focus and, and have in common. And this has been, you know, powerfully demonstrated [00:04:00] by the way in which businesses are in the United States permitted, even sort of built into the electoral process, permitted to, to put their money and, and influence into that.

In a way that we would think of, I suppose, classically as intrinsically plutocratic, whereas in some other countries, uh, instruments of power become captured by long processes of state governance, regional governments, and so on. Although the outcome is about balance and imbalance, there’s a hugely dynamic field of different interests conflicting in different ways and tipped one way or another.

So, we can come back to look at the implications for. Leadership and innovation in leadership and the space where innovation might be fruitful, both for the individuals, but especially for societies in that way. I think that it’s becoming more and more pressing for us and more difficult, but also more important for us to turn our backs to sort of close our eyes or just turn away from facing the [00:05:00]impending catastrophic impacts of climate change and ecological disruption.

We know that we have Only one planet. That’s what we’ve got. We also know that we’re consuming every day many, many more resources, both the inputs and the capacity to absorb our outputs and waste than that. The overshoot day today was the 1st of August. So globally, by the 1st of August, we’d used up all the capacity that the Earth has.

And since then, we’re living on debt, you know, somehow we’re borrowing from future generations the capacity of the earth. But another way to put it is that we’re living as if we have two planets. Kuwait, that overshoot day was sometime in February. In the U. S. I think it was mid March, so just before Easter.

So by Easter 2024, the people living in the U. S., overall the U. S., of course there’s a huge variation in how people live. But. [00:06:00] On average, people in the U. S. were living as if, on the assumption that, on the fantasy that, we have two planets. Now, we know that’s crazy, because we don’t have two planets. And yet, every day, we get up, go to work, put money into our pensions, or collect our pensions if we can, uh.

We educate our children, we look forward to another day. All on the undeclared belief that we’ve got two planets. Now clearly this is fantastical. It’s crazy. But how else can we continue if we don’t deny that truth? If we were to face into that and live like that, live as if we were really aware of what we know inside, we’d have to radically change everything that we do.

And that’s too difficult. That’s too difficult. So we must deny, and I think the semi conscious, the emotional collective necessity for denial is one reason why we select [00:07:00] leaders who are really good and for whom, whether something is true in the whole sense of being intimately connected with fact and the account we give of fact, what happens and the account we give it, that kind of intimate connected sense of truthfulness is really difficult to live with now.

We live instead with stories we tell ourselves, stories we tell ourselves about, Oh, we’ll find some way to store all this carbon underground, or we’ll invent some new sort of energy, or whatever it is. Or simply that that’s not what matters, what matters is Conquering inflation, growing the economy, something, all these things which are important in the current way, but they’re not going to help us in the long term.

Because we need denial, we elect people who are good at it. We need stories that are dissociated from reality, so we elect people who are really good at that. And I don’t think this is just down to one political party or another because we all do it. How else can we get by with it? But it’s not going to [00:08:00] do us good for long.

So the question I’m working on and posing is, how can we face the reality that we have only one planet? What are the implications for the way we educate each other, the decisions we make about our lives and work? Uh, making and consuming and enjoying wealth and so forth.

Maureen: That’s a beautiful segue into then Henry and corporate social responsibility 2.

0.

Henry: If you think about the way corporate social responsibility has generally been portrayed, it’s kind of dealing with the problems directly, uh, using less carbon energy, polluting less, whatever it is. And that’s good stuff and necessary, no question. What I call Corporate Social Responsibility, CSR 2. 0, is getting at the root cause of this, which is why are we using too much carbon energy, why are we polluting, and what can we do to reverse that.

To reverse that means a kind of a whole different mindset about the [00:09:00] consequences of regular business activity. Even lobbying, you know, you might pollute less, and yet, Lobby to increase or maintain the benefits to oil companies of subsidizing the carbon energy industry, for example, is not constructive.

So people have to, in business, have to step back and say, what’s the responsible thing to do? Now, if you’re responsible to the world, are you responsible to your shareholders? And the answer to that question is kind of short term, long term. You can benefit your shareholders short term by gaining subsidies or whatever, selling more coal.

It doesn’t benefit long term, but of course if you’re paid and your bonuses come from short term stock market forces, then, um, that’s what you’re going to do. But we have to wake up to the dysfunctions of the stock market. Companies don’t have to go IPO, or they could go that way and yet maintain voting shares [00:10:00] in some kind of family trust or something, which is common in Denmark.

And Tata, for example, in India, the voting shares are controlled by family trust, so they don’t have to be beholden to short term pressures from the stock market. And they can serve their shareholders by long term. If you’re a day trader, you don’t care about long term, you don’t even care about quarterly profits.

But if you’re in, for the long run, the way someone like Buffett has been, then you care about the responsibility of corporate activity.

Maureen: And we’ve seen companies like Amazon and Microsoft who are making climate pledges and who do appear to be taking concrete action in that direction. And I want to say, what is it Amazon’s doing?

A hundred thousand rivians, electric vehicles, and what’s the charging.

Henry: Yeah, and by the way, this isn’t just corporate. Quebec has an enormous amount of hydropower, and there was a proposal to put lines through Maine to carry that hydropower into the states. The more they use Quebec [00:11:00] hydropower, the less they need to use coal or oil or gas or whatever it is.

It was voted down by a referendum of the people of Maine. This is not responsible. This is utterly irresponsible, in a way. Solve the problem, but not in my backyard. Well, you gotta bring that energy in somehow. So, you know, we’ve dealt with that problem with windmills, in the sense of wind energy, in the sense of putting them offshore, so people don’t complain about my backyard again.

So there are solutions, but there’s also a lot of narrow thinking on the part of the population. Glaciers that are melting in Antarctica are kind of far away from the ice cubes that I’m making in my refrigerator. I’m concerned about the ice cubes in my refrigerator. I’m not concerned about the glaciers that are melting in the, uh, Antarctic.

Maureen: The word privilege comes to mind. If I can’t pay my rent, the glaciers in Antarctica aren’t my biggest problem. Feeding my children [00:12:00] is.

Henry: Yeah. So there’s a contradiction between the needs globally and the needs locally and personally. Again, I’m not sure action on climate change has influenced the pressures on people as much as the imbalance in the society, as much as the lobbying.

And look at the example of minimum wage in the United States. It’s scandalous. It’s absolutely scandalous, and yet it continues. It’s not going to serve business, because to get back to what I was saying before, Trump or somebody else is going to have to deal with the people who feel beleaguered. And either they’ll be able to reverse some of the worst problems for them, like minimum wage and other things, or they’ll be held to pay.

And that won’t serve business. So again, it’s also a short term, long term. If I’m the chief executive and I’ve got another two year terms, well, let somebody else worry about it, but that’s not responsible business. That’s not CSR 2.

Maureen: 0. I do want to argue for the CEO. We’ve got some who are very responsible [00:13:00]and.

civically minded, and we’ve got others who are absolutely focused on their tenure.

Henry: Yeah. And the nature of the stock market and the nature of executive compensation is a problem. Look, if we’re talking about leadership, accepting or even promoting, but let’s say accepting to be paid several hundred times as much as your basic workers is not leadership.

That is not leadership. Because it sends a message that I’m 300 times more important than you are. Number one, that’s a lousy message. But number two, it demeans the people who are at the bottom of that scale and maybe their paid minimum wage are below. Let me give you a little story. I was in Copenhagen a few years ago, and I was told that People at McDonald’s, working for McDonald’s, were being paid about 25 an hour.

I guess because of some minimum wage or whatever, and could live comfortable middle class lives, non threatening, especially with the protections they have in [00:14:00] terms of health care and education and so on, compared to people in the U. S. who are paid less, don’t have those protections, and so on and so forth.

I did a little calculation. That a Big Mac has to be verified, that a Big Mac in New York would be about a dollar more than a Big Mac in Copenhagen. Well, that’s a small price to pay for democracy.

Maureen: And you’re saying the Big Mac in the U. S. is more expensive and less worker protection?

Henry: No, no, no, no, it’s less expensive.

Oh, it’s less expensive. Okay. It’s a dollar cheaper. Maybe it’s two or three dollars cheaper. I’d have to check because this was a few years ago. But. No, it’s, it’s cheap in the U. S. partly because people are paid much less and partly because the corporations don’t have to cover the kind of health care costs and pay the taxes that they do in Denmark.

But the result of it is Denmark doesn’t have these kinds of severe conflicts that the U. S. has. The country has to wake up to balance, including the business people and the people in [00:15:00] Maine who vote for, uh, the referendums, like the one I talked about and so on.

Jonathan: The question that really Henry’s addressing, which is a very important one, is about in whose interest we are, and that is really hard.

I retired from a job at the university after teaching for 30 years in universities, and I was able to claim my pension, and it is an index linked pension to inflation. As a result of that, I am protected to some extent, my income, so long as the pension management company prioritize earnings keeping up with the current inflation.

In other words, they prioritize the return on those investments. In my lifetime, in fact, month by month, for my income. So, although I sit here and say and agree with Henry that, you know, a long term future generations, uh, exploiting the earth and so on, I do rather depend on them not taking that too seriously.

So I am culpable along with so many and, and so I can see that if you [00:16:00] are running one of these companies, a fund management company, the short term or long term, this is, these are not just, um, sort of abstract decisions. They’re real people in either case. This is a systemic force that drives increasingly more and more critical tensions in the way we make business, what we do with wealth, the scale of debt in money terms, as well as in natural resources terms is just astounding.

And the only way that the whole edifice keeps going is if we’re able to keep growing, that is, if we intensify the problem.

Maureen: As leaders, what are we reflecting on? What questions are we asking any of us who plans to retire is contributing to the economic decisions that I expect my investments to increase in value or I’ll devolve to eating cat food for my elder years.

And I really don’t want to do that. All of us. Who have that expectation, [00:17:00] do contribute, and I would also like the planet to not flame out before I expire. How do we balance the tension of the desire for economic return against ensuring that our employees have living wage?

Henry: Which comes down to where to intervene, basically.

Where do you intervene? And I think the financial markets, are utterly dysfunctional. If a chief executive of a company is choosing short term versus long term, they’re essentially choosing not between their own income so much, except short term, they’re choosing between their bonuses and their progeny.

In other words, they may cash in, in the next few years, while screwing their own progeny. Okay? Not individually, but collectively. So, what do you do? Well, you’ve got to change the nature of the stock market. There is one easy way to change that, which is if entrepreneurs don’t go public. By public, I mean public offering stock.

If they don’t go public that way, then the [00:18:00] company can maintain a kind of long term responsibility, especially if the family is controlling it. I don’t know, you know, Levi Strauss or something. I don’t know what’s going on there now, but it’s been family forever. Whether the family actually controls it, I don’t know.

Maybe they do. Family. Interests control Tata, they control most of the Danish, or some kind of trusts control most of the companies we know, like Lego and Carlsberg and so on, so that’s possible to do. Either you don’t do a public issuing of stock, or you do it in a way that keeps the short term analysts at bay.

Governments could make changes too, the idea of day trading. Governments can create some kind of tax situation that discourages very short term and encourages longer and longer holding of stock. It worked for Buffett, it can work for other people. So there are ways to deal with it, but we’ve got to recognize it.

Maureen: If we look at our billionaires, people like Bill Gates are making what appear to be investments and commitments to [00:19:00] our long term sustainability, and they’re still profitable. Highly profitable.

Henry: Yes. I mean, Gates has basically got all that money and he chooses what to do with it. Now, Bezos, for example, has chosen not to allow the Washington Post to take a position in the election.

For what reason? To protect Amazon? To protect his wealth because he believes in Trump? I don’t know, but gotta sort of ask questions about that. So no matter how responsible he may or may not be in this business, of course, he’s not running the business anymore.

Maureen: It again raises your point of structural.

Are there structural controls? Because we will have people who are more self serving and less self serving.

Henry: Yeah, and we’ve got to award the people who will benefit. Overall, look, it makes no sense whatsoever for me to vote in an election. I have never voted in an election where my one vote made a [00:20:00] difference.

So if I don’t vote in my election, nothing will ever change. Maybe sometime there’ll be a one vote, but almost never. So why should I vote? Well, I don’t know. For obvious reasons because if everybody takes that attitude, well, we’ve got the same problem now with climate change and with distribution of wealth and with everything else that’s going on, is if everybody takes that attitude, which they are, mostly, we’re doomed.

Maureen: I think we had in the U. S. something like 17 million fewer votes this election than last election.

Henry: That’s shocking. Seriously?

Maureen: It was something like that number, yeah. So we had a lot of people who sat out. Didn’t like either candidate, so they chose not to engage. Yeah.

Henry: People may not vote for several reasons, one of which is they truly are opposed to both candidates.

So in a sense, that’s a constructive vote in the sense they’re voting without their feet, you could say. But they’re sending a message. But of course, how many of those, who knows?

Maureen: What do we [00:21:00] as individual leaders, how do we as Parts of a collective navigate those complexities for which there is no easy answer.

Henry: Well, I don’t see it that way. Complexity.

It all looks complex until we look at the causes of these problems and look at the nature of balance and realize that what’s going on in the U. S. is not entirely different than what went on in the Soviet Union, that the country is out of whack, it’s out of balance. Private interests have huge benefits.

The comfortable people, which includes not only the super wealthy, but people who serve the U. S. super wealthy, and I kind of include myself in a way. Look, I’m in a business school that was funded by a very wealthy guy in Canada, so I benefit from his wealth. And think of all the lawyers and accountants and physicians and all kinds of other people who serve wealthy people.

They’re comfortable. They do [00:22:00] well. And other people. The most striking example, I think, is that Harvard still has this legacy admissions. It’s the ultimate in hypocrisy. Essentially, you may get in because your parents or one parent went in. That’s absolutely unacceptable, especially to keep this going. And yet, they’ve always done it, so they always do it.

It’s comfortable. It’s comfortable to know that I, my child will get in, not because they’re necessarily better than other candidates, but because I went there. I didn’t. I went to MIT, so my kids don’t, don’t get favored and, and don’t, and aren’t applying to MIT.

Jonathan: One implication for this is that leaders who want to be innovative, who want to take up the possibility to use their imagination combined with What they’ve learned about how to use their authority, their sense, their voice, their sense of confidence in their own understanding of what’s happening, their ability to balance dilemmas, to move in spite of [00:23:00] uncertainty, and so on.

To give some thought to the outer ranges of the immediately possible, or the immediately likely. to take those capacities to help us collectively and them and their families as well and their organizations. Think about the things that are perhaps less at the center of the normal distribution curve of likelihood, if one would say, what are the things that are less likely, but highly impactful that might happen?

And one of those is that we will find some extraordinary solution to the troubles we’re in. We will rebalance our societies. We’ll Discover technologies that will enable us to continue to produce more and more energy without. In any case, anyway, pulling on, demanding unavailable resources and so forth, and that will regenerate nature and the ecosystems that we depend on.

Unlikely but possible. So let’s think how would we do that and put our imagination into that called regenerative leadership. [00:24:00]

Henry: We

Jonathan: have no choice. And at the other end of the spectrum of unlikely but highly impactful is that we won’t, we And I’m not going to manage to do any of those things or not enough of them soon enough, in which case the edifice of modernity will collapse.

And we ought to be, in that case, thinking courageously about, in Vanessa Andreotti’s terminology, how to hospice modernity. As we become a bit older and it becomes more relevant to think about, we know we’re going to die. The question is, how will we die? How will I use modern technologies and painkillers and health care and, and the wealth I have to die well, personally, when that becomes a relevant question, as one grows older and thinks about these things.

But similarly, socially, how would we think of this way of life being unsustainable? So how do we face that? What do we bring to that? There are people who’ve been thinking very provocatively and creatively, interestingly. [00:25:00] Vanessa Andreotti, who I mentioned, is one of them. There are many others. Jim Bendel has written, I think, a very challenging book called Breaking Together, which poses these questions in a way that I think stimulating for leaders.

So give some time to those, the tales either end the probability curve.

Maureen: I love the, the idea of regenerative leadership. That’s on the positive side. Hospicing modernity is a more bleak image. If we think about the pulse of opportunity, it does invite us to really consider.

Jonathan: It does. Jim Bendel’s term is a deep adaptation.

So he’s recognizing that we inevitably are adapting and have to adapt to changing circumstances and change new technologies and their implications. We all have to adapt to artificial intelligence and so on. We also have to adapt to a much more fickle and unpredictable climate and so on and so on. So adaptation is a good thing.

And what he thinks [00:26:00] about deep adaptation is adapt to the sort of deepest. Most of difficult to digest possibilities. How do we do that for people watching your podcast who are interested? There’s quite a lively online debate and I think it’s called deepadaptation. info is the link for the Deep Adaptation Forum, which is people who are thinking seriously about that.

So, so anyway, I hope that leaders who are not spending all their time Thinking about those who are dealing with issues now, can nonetheless bring some of their imagination and confidence and, uh, and insight into that sphere, because that normal distribution curve is sort of flattening a bit. So those tails become more complex and more extended, and we’ve got to really think how we live in those.

The normal is less narrower. range of possibilities, which I suppose brings me to the final point I talked earlier on about one planet leadership, emphasizing that we have one planet, but we do live in many different worlds. [00:27:00] Our experience of the world to what matters or accounts what’s precious, what’s valuable, as you were saying, and Henry was saying that for many people.

Climate change is an old story. Society is already breaking down from scarcities and pollution and various things. So, just sustaining social order is important. We need to hear and learn about these things. That’s why in some of the work Henry and I have done, we emphasize worldliness. A kind of awareness and a familiarity and a comfort with the different ways in which we live in the world on our one beautiful planet.

Maureen: How would people learn more about your work and your perspective?

Jonathan: That piece is all on a site called oneplanetleadership. org. And I do invite people who are interested to get in touch through that.

Maureen: And Henry, how would people learn about your work?

Henry: Oh, that’s easy. RebalancingSociety. org is a website that carries it further, but the original book, which is not very long and easy to read, I [00:28:00] think.

is called Rebalancing Society, and in fact, thanks to Barrett Kohler’s generosity as a publisher, they let me put it up on my own website as a PDF, so anybody can download it for free. They can buy it on Amazon and all that, but they can download it for free on Mintzberg. org.

Maureen: Thank you both for a very provocative conversation.

Henry: Thank

Jonathan: you. Indeed.

Maureen: And I want to thank the International Leadership Association for arranging these conversations for us.