As social impact organisations stir our conscience, where does your organisation stand?

Delivering social value through leadership and governance

"Leading in social value is a privilege. To add value and deliver impact, leaders need strong governance expertise that goes beyond traditional metrics – applying it to unify and elevate performance, strategy, risk, and stakeholder engagement in ways that create lasting value for both the organisation and society.”

Alun Parry
Managing Partner, Australia

• The need to rationalise social and economic value creation is shifting the approach to leadership and governance.
• Priority leadership competencies include the ability to:
  • Manage tension and conflicts that necessarily arise in combining social and economic missions
  • Manage organisational identity, resource allocation, decision-making
  • Manage relationships in different environments that challenge legitimacy and resourcing
• Governance needs to focus on:
  • Inter-organisational relationships – with different types of external stakeholders, partnerships, outsourcing relationships
  • Governance design – structures and processes that ensure accountability, transparency, responsiveness, rule of law, stability, equity & inclusion and empowerment
  • Manage joint accountability to social and economic objectives

How socially-conscious leaders recalibrate the organisation

• The social enterprise census in Scotland describes ‘socially conscious leaders’ as:
  • More ambitious for social change than for personal wealth and advancement
  • Willing and able to take risks
  • Possessing an understanding of business processes and priorities as well as sustainability imperatives
  • Balancing tactical and strategic skill-sets
  • Being adept at fighting and surviving cynicism, caution and the status quo
  • Working across sectors, business units, and skill sets
  • Continuous learners and innovators
• Socially conscious leaders are natural ‘educators’ or ‘influencers’ with a big focus on learning. A key observation from our work, is that these leaders create learning organisations (see Section 2 Trailblazers, The Coca-Cola Company).
• As American physicist William Pollard said, “Learning and innovation go hand in hand. The arrogance of success is to think that what you did yesterday will be sufficient for tomorrow”
• There is therefore a pressing need to understand how to recalibrate an organisation around ‘social value’; and how to improve the engagement, evaluation and attraction of socially conscious leaders to achieve it.
• Far-sighted boards are therefore reframing the big picture:
  • “How is convergence between social and private enterprise driving a new vision for social value? What can we learn?”
  • “Is the structure and culture of our organisation aligned with driving social value? Can we put a framework around this?”
  • “How does governance ensure social value? Who can ‘mentor the board’?”
  • “How do we achieve impact through purpose- and values-driven leadership?”
• • “How do we make better decisions around leader profiles to deliver social value and sustainable enterprise”
  • “Do we have the right people on the board?”
  • “How can we recalibrate executive talent around social value?”
• Read more on the topic: 
  Downward accountability to beneficiaries in social enterprise (eccentric source, healthcare related)
  Social Enterprise Census

Convergence drives ‘porous leadership’ across for-profit and non-profit organisations

• A porous organisation collaborates with external partners in a flow of ideas and insights to create new value streams. The Brainzooming group describes how this porous organisation “enriches its internal value system and stimulates growth with an open, collaborative and adaptive culture”.
• As convergence between for-profit and non-profit organisations gathers momentum, leadership itself has become porous, changing internal value systems, and creating an adaptive culture more mindful and reflective of the external forces shaping society.
• Traditional non-profit organisations are hiring experienced executives from for-profit organisations to strengthen the overall business focus, credibility and drive brand awareness. While, for-profit organisations are seeking non-profit leaders to strengthen social value credentials and create a culture shift.
• As the landscape changes, more companies like Raspberry Pi are running Foundations that feed revenue into the organisation. They are looking for experienced non-profit leaders who understand the required structure, legal & regulatory environment and have experience in leading the teams within it.
• For leaders themselves, those typically at the peak of their careers in for-profit organisations are often looking for a more meaningful final role. While a non-executive director role was the traditional career finale, leaders are increasingly looking to use their experience and skills in non-profit organisations to conclude their careers in doing well by doing good.
• Read more on the topic: 
  Brainzooming: 6 ways to make your organisation more porous

Identifying the right leader in a socially-conscious environment

"Leadership in a socially conscious world is complex, demanding adaptability, empathy, and a committed focus on both people and the planet. Leaders must evolve continuously, balancing purpose with profit, upholding ethics under pressure, and driving meaningful, inclusive change. Self-awareness will be essential for delivering authentic leadership that builds trust and credibility in meeting future demands."

Karen Daly-Gherabi
Partner, United Kingdom
Global Sector Leader, Public Sector

• Executive leadership in a socially-conscious environment involves treading a careful line. Not being too woke, while not being too profit-oriented at the expense of broader opportunity. And not being so empathetic that individualism trumps the greater good. 
• We are definitely at an inflection point, where so many catalysts for good have been ‘weaponised’. Organisations that have been beacons of ‘progress’ have been lambasted for having too deep a conscience: for example, champions of EDI John Deere and Harley Davidson, challenged by the anti-woke right. Others are called out on the assertion that they have no conscience at all: the defence industry, Starbucks, McDonalds, universities and even Western governments for indirectly and directly contributing to global social challenges.
• At the organisational level, executives and their teams need to master the ability to make decisions that could have implications on and beyond the bottom line. This is where diversity of thought, and receptivity to it, is so crucial, so that when making tough calls nothing is missed and unintended consequences avoided.
• Hiring socially-conscious leaders in today’s environment involves a fundamental question: what does ‘socially conscious’ mean in your organisation? As CEO, how socially-conscious are you, or your board, and what do you expect of your executives and teams in this context? The subjective and objective must be aligned.
• To achieve success – whether bottom line, investor returns, community engagement, reputation & brand, industry stature – where are you on a scale of 1 to 10 regarding the importance of being socially-conscious?
• And to what extent is this authentic social conscience? Industries such as mining have social consciousness prescribed, given the lens through which they must operate to protect the indigenous population and community.
• There is another dimension to authenticity. Knee-jerk ‘wokeism’ has given way to something more nuanced, where human sensibility, diplomacy and principles reside – the more sophisticated concept of ‘impact’; and for talent experts, the human element of impact.
• With developments in AI and quantum computing, executives will be assessed much more on this human element: courage, heart, nuance and consciousness. They will also need an international mindset, particularly relating to emerging markets. More personally, they will need agility and sufficiently robust health to operate in a complex business environment.
• In a more nuanced, intangible assessment of leaders, organisations still need to be clinical and fair about accurate assessment, using matrices and rankings for leadership candidates based on the social conscience of the organisation.
• For example, a CEO may need to be bold and politically astute; this can be contradictory, so a talent expert needs to explore if they can be both, and if the emphasis needs to be on being courageous, or diplomatic. Scenario questioning is key here: in a particular scenario, for example requiring a North American university President to tread a careful line, do they err on one or the other side of polar opposites? And why? What are their drivers? Is their pendulum swinging too far of the centre ground?

Conclusion 

In sum, for-profit and non-profit approaches are merging in the social value economy; executives need to pursue holistic leadership drawing upon fundamental human characteristics as well as knowledge, insight and technical capabilities in their decision-making. Through this, we will see the further evolution of ‘servant leadership,’ with executives serving the community and indigenous groups, as well as their teams, building capacity for and around them.

Talent is therefore a trojan horse. Understanding more about socially-conscious leaders, and analysing the kind of leader an organisation needs, enables a board or executive committee to work out who they are in the social value economy, how they are seen in the market and where they want to get to.

“The path to defining and delivering social value will undoubtedly continue to test the vision, resilience, and fortitude of today’s leaders, but it also presents an unprecedented opportunity to create a more equitable, inclusive, and sustainable future. By embracing these challenges, and not shying from difficult choices and discussions, leaders can set the example for generations to come. Conversely, those who choose the easier path risk leaving a smaller impact.”

Michael Naufal
Managing Partner, Canada