The September issue of Harvard Business Review includes an article by Nathan Foote, Russell Eisenstat, and Tobias Fredberg, titled The Higher Ambition Leader, that is essential reading for everyone interested in corporate social responsibility. The article illustrates how some leaders with high ambitions recognize that there’s a big difference between so-called CSR and corporate social purpose.
The premise of this piece is that high ambition leaders “strive to generate high performance on three fronts at once: creating long-term economic value, producing significant benefits for the wider community, and building robust social capital within their organizations.” The result? With the resources created through improved financial performance, leaders can “build social capital within the organization and social value outside it, generating further economic value and spurring the organization to even greater heights.”
Standard Chartered Bank is one example. In 2009, as Citibank’s share price plunged to less than a dollar, Standard Chartered “posted its seventh successive year of income and profit growth – without any help from emergency government funding.” The authors contend that what really made the difference is that the bank’s CEO, Peter Sands, is one of a group of higher ambition CEOs who have evolved a superior approach to running their companies.
In 2001, when Standard Chartered wasn’t confident about its future, the London-based bank took a traditional approach to identifying its weaknesses and strengths and restructured its global operations. Sands and his colleagues also did something much less conventional. They put a high priority on reviewing and refocusing its charitable activities. In 2003, the year of its 150th anniversary, the bank established Seeing is Believing, a program that raises money to combat preventable blindness around the world. Funds raised through Seeing is Believing have now “restored the sight of over 2.5 million people across the bank’s markets and reached another 7.5 million through preventative care,” says the piece.
Seeing is Believing also led to the creation in 2010 of Here for good, Standard Chartered’s brand promise. Here for good communicates the bank’s permanence in an unstable financial marketplace and also its social purpose. In 2003, after the SARS outbreak in Asia, while other banks reduced support for customers in the hotel and travel sector “Standard Chartered did the opposite, proactively asking its customers if they needed additional lines of credit to weather the crisis.” The bank was also one of the few financial institutions to continue lending during the 2008 financial crisis.
Here for good is more than an advertising slogan. It is a crisp and compelling articulation of the corporation’s social purpose that captures more than seven years of actions that made a difference in the lives of people around the world and differentiated the company from its competitors.
The HBR article includes a three-part approach to how “higher ambition” leaders work:
- They forge a more powerful strategic vision by drawing on an expansive view of their companies’ heritage and cultural, organizational, and social assets.
- They build the widespread commitment and capabilities to achieve that vision by developing the organization into a community of shared purpose.
- They have the strength of character to commit themselves and their organizations to that vision over the long term.
I agree with Foote, Eisenstat and Fredberg. Many thanks to the authors for advancing the idea of higher ambition leaders and helping to clarify the difference between CSR and corporate social purpose.