The reason life works at all is that not everyone in your tribe is nuts on the same day. Anne Lamott
Disney versus the state of Florida regarding children’s instruction on sexual orientation and gender identity. Elon Musk’s potential takeover of Twitter. The pending split of the United Methodist Church. Texas near-complete ban on abortions. Progressive proposals to defund the police and eliminate ICE. Activist investor Engine No.1 pressing Exxon Mobil to reduce its carbon footprint. Transgender athletes participating in sports. Purging of countless school leaders, board members, curriculum and Covid protocols. We seem to be racing to the political right and to the political left simultaneously, all while coming apart. It’s like everyone is going nuts at the same time.
What do these headline stories have in common? A revolt led by a small or large group of activist stakeholders to impose – or attempt to impose – somewhat dramatic change on a majority or plurality of other often startled, and even blindsided, stakeholders. Rather than chaotic change followed by orderly implementation and absorption, it is the chaos of one extreme leading to even greater chaos from the escalated reaction of its opposite extreme, all inflamed by social media’s capacity to transmit conflict at the speed of light.
As Jon Haidt argues in his recent excellent Atlantic essay, the result is fracturing, shattering and scattering everything. The likes of Twitter and Facebook can protest and overthrow but they can’t govern. They can subvert leadership but they can’t reconstruct or restore it
For the past decade we have pounded on CEOs and other leaders of business and non-profits to exhibit more effective Stakeholder Leadership in managing diverse stakeholder groups.
Yet, no matter how vociferously we entreat CEOs and other leaders to address the chaos, they face a stubborn challenge. A major shift in the balance of power to stakeholder groups is reordering organizations and the role of leadership. It is a new era but has been coming for a while. In 2019 the Business Roundtable announced “shareholders” were no longer the sole priority for an enterprise and that customers, employees, communities and other stakeholder groups should have more say in decisions that impact them. Impact investing – targeting specific social or environmental effects often championed by employee, gender or racial equality, environmental, or community stakeholder groups – has increased ten-fold since 2012.
Disney CEO Bob Chapek is just the latest high-profile leader who, after announcing the company’s intention to avoid division and chaos by staying out of Florida politics, now finds himself and Disney in the middle of protests, boycotts and even punitive State actions by stakeholders on all sides of the sexual orientation and gender issues. As a CEO client said to me last week regarding divisive stakeholder issues his board is dealing with, “It’s not that my board has gotten into the weeds, it’s that the weeds have gotten into my board!”
It is time to ask: What about the responsibilities of these empowered stakeholders – and by the way we are all stakeholders in our schools, churches, at work. Have we given them (or us) a pass? What about when stakeholder groups and their leaders dictate demands, refuse to engage or negotiate, caring solely about the interests of their narrow group, indifferent to fellow stakeholder interests? At best it creates gridlock. At worst, it stiffens the resistance of the opposition. Important stakeholder causes languish. It is why, in private, we hear a growing chorus of leaders lament that the stakeholder chaos is making their organization increasingly “un-leadable” – at least in the way they intend.
Too little stakeholder pressure can limit progress for important causes, but our greatest dysfunction these days comes from out-of-control stakeholder actions creating hardened targets for desired change from other stakeholder groups. Either nothing gets done or extreme things get done.
Just as we ask our CEOs and C-suite leaders to be more effective in addressing diverse groups, it is also imperative that we ask more of these empowered stakeholder groups.
This is a tough ask. Many stakeholders believe passionately in their cause and a number are understandably scarred by having been ignored and oppressed by the powerful. But either you think being ignored and oppressed is a bad thing, or you don’t. If power corrupts, then power wielded by narrow, unruly stakeholder groups can be as corruptive as that wielded by CEOs, dictators and czars.
The stakeholder revolt described in my 2017 Huffington Post article has taken on a life of its own. It is time to ask of stakeholder groups what we have been asking of our organizational leaders: To get constructive things done, be responsible and accountable in navigating beyond gridlock and division.
Four Rules for Responsible Stakeholders
I think the problem for the Democrats right now is not that they have bad leaders. They have bad followers. Paul Begala CNN Contributor and former Clinton aide on his party’s attempts to pass voting rights
We can chuckle when leaders blame their woes on bad followers. However, it points us to a very incisive question: How might “followers” or stakeholders in today’s world become less of the problem and more of the solution? If leaders ultimately get the followers they deserve, is it also possible that over time, followers get the leaders they deserve? Effective leadership is a dance; sometimes you lead and sometimes you follow.
Making the shift to more responsible and accountable stakeholder groups is complicated and difficult. Let me suggest four key rules that provide a starting place.
1. No victims: Remember Tom Hanks expostulating, “There’s no crying in baseball!” in “A League of Their Own?” Well, for stakeholders there’s no “victiming” in organizations or life – at least that is constructively sustainable. That does not mean that we ignore egregious wrongs so many have suffered: Blacks, Hispanics, Native Americans, women, black women, men, black men, old white men, rural, powerless, Jews, Arabs, progressives, conservatives, disabled, mentally ill, addicted, LGBTQ, poor, homeless, workers, working poor, immigrants, refugees, police, religious persecuted, atheists, leaders – we are reminded, the list is endless.
Nonetheless, being wronged and how we respond to being wronged are two separate issues. First, taking on the role of victim is an act of the will, conscious or not – it is not something circumstances or others can assign us. We can all point to individuals and groups who have met with horrible circumstances from horrible oppressors who refused to let themselves think and feel like a victim. They embrace their own agency and are unwilling to surrender their power or accountability. Clearly Ukraine and its leaders have been dealt a terrible blow by the invasion of Russia and yet what has been defining is not their victim status but their exercising power and accountability to take on the fight.
Second, taking on the victim role incurs all kinds of costs, reserving the greatest cost for those who give in to it. Martin Luther King Jr., Nelson Mandela and Jesus share that magical ability to acknowledge the plight of the downtrodden without giving in to the temptation to make them victims.
We are often reluctant to hold accountable those who have been powerless or treated unfairly. For example, the recent allegations regarding a lack of financial transparency and accountability on the part of the Black Lives Matter organization may be seen by some as unfair, but the bigger risk is that it will damage the legitimate aim of addressing racial injustice. As President Bush famously lamented, “the soft bigotry of low expectations” is a costly bias but too often unwittingly endorsed by activist stakeholders.
Finally, victimhood gives permission to shed accountability and thus be as bad or worse than one’s oppressors. We have seen too many examples in the extreme reactionary legislation, riots and violence where “getting even” really means endorsing bad behavior that feeds an awful downward cycle. When those on both sides of an argument promote more extreme positions, we risk winding up forced into untenable choices: unlimited abortion or abortion under-no-circumstances, open-borders or condemnation of all immigrants, book burning or indoctrination on gender and sexual identity. That is not bottom-up leadership, it is anarchy, and it poses great risks to each side.
2. Be a power sharer not a hoarder: When you have been the “thumpee” for too long, it is hard not to relish newly gained power to become the “thumper.” We have all seen just how ugly and dysfunctional it can be when the formerly out-of-power stakeholder gang morphs overnight into the in-power stakeholder gang attempting to dictate to leaders and other stakeholder groups on behalf of their righteous cause: My way – no compromise, or the highway. But if you really are an advocate of curbing oppressive or excessive use of power by the other side, it is hypocritical and destructive to wield power punitively when you gain it. Authoritarian use of power for me but power-sharing for thee doesn’t work. Misuse or abuse of power risks pushing the powerless further down the victim ladder.
We have seen in raucous school board meetings, protests like at the capitol, and other places how tempting it is to take on the very excesses attributed to the other side. “To the winner goes the power and spoils” must be replaced by “to the winner goes the responsibility and accountability to do better.” Francis of Assisi’s often quoted line nails it: “The best criticism of the bad is the practice of the better.” Power sharing and victim-freeing is better and more sustainable.
3. Acknowledge progress – no matter how meager: One of the biggest mistakes I see made by new leaders is to denigrate the former leaders and discount the progress of those who have gone before. Same goes for newly empowered stakeholders. Acknowledging progress builds connective tissue that binds us to those with whom we disagree. The progress to date is owed by predecessor boards, leaders and workers, and future success depends in part on the foundation they built. No matter how tempting it can be to discount the “old,” alienating a whole group of heritage stakeholders is a costly unforced error.
Even in areas of significant failure obvious to all, it is usually possible to acknowledge legitimate effort and intentions. That is called grace and it helps enlist the “old” team while leaving plenty of space to pursue different approaches and redirect in a way that energizes the new team. Too often stakeholder leaders play to win the short-term with their narrow audience when they could gain more by leading broader, longer-term sustainable change. Sustainable change can be greatly aided by two things: fewer outright enemies who oppose you and more neutral stakeholders who can be influenced to lean your way. Acknowledging progress costs little and gains much. This grace of acknowledgment we offer today will be grace we will need returned tomorrow.
4. Practice humility: It seems we live in a time when we have never been so sure we are right and never so often wrong: weapons of mass destruction in Iraq, Hunter Biden’s laptop as Russian disinformation, you can keep your doctor, warning of the ice age, the election was stolen, transitory inflation. Self-righteous stakeholders closed to new information unwittingly distinguish themselves in what we might call “willed stupidity.” Since they have all the answers, there is no need to hear or learn from others, particularly those distrusted souls on the other side. They exist in a closed system. As attributed to the late Secretary of State George Schultz regarding the collapse of healthcare startup Theranos, “Isn’t it amazing how far decent people will go when they are sure they are right.”
Stakeholders who have witnessed just how wrong leaders can be are tempted to exhibit the same unwarranted confidence in their rightness. We need leaders and stakeholders confident enough to admit they are almost surely going to be dead wrong sometimes. As the head of research for a major research hospital said, in a session I was leading, “There is no settled science.” It is always evolving, confirming or contradicting, or refining what we know. Science is a vital in helping us draw better conclusions and make better decisions, but when we become closed to further questioning, we undermine its power. Humility, the antidote to willed stupidity, is the lubricant that can transform stakeholder friction into constructive, sustainable progress.
We have entered a new era where stakeholders have assumed an enhanced level of leadership and power. It calls not for going nuts but for each of us to look in the mirror and ask: Are we stepping up and playing our part as responsible and accountability stakeholders?