The Science Of ... , Evergreen Content

How ‘mature’ leaders create value (and how destructive immature one always are)

Many businesses are guilty of “ticking boxes” when it comes to governance issues.

Some get on the “sustainability reporting” bandwagon merely to look good.

So says Rob Worthington-Smith, founder of FarSightFirms.

FarSightFirms analyses and provides a rating of the maturity of a company’s leadership.

It does so in the belief that there’s a link between mature leadership and lasting value creation.

Building value requires a leader to:

  • Engage with stakeholders, understand concerns and put it in context for the business.

  • Take personal accountability.

  • Manage the tough issues facing the business through relevant, comparable KPIs.

  • Put together a strategy that works to resolve these challenges competitively.

The FarSight model is a simple rating (consisting of 96 data points) of how well a leader responded to a challenge.

What makes for a mature, value-creating leader?

  • A good leader does not avoid addressing tough issues.

  • She admits shortcomings and identifies where she can improve or innovate.

  • She then drives these improvements from the top of the organisation.

  • She reports openly, so she is held accountable.

What makes for an immature, value-destroying leader?

  • She sweeps issues under the carpet, or sticks her head in the sand.

  • She rushes into dubious behaviour regardless of the risks, or sticks her head in the sand.

  • She reports with a combination of virtue-signalling or box-ticking.

The Money Show’s Bruce Whitfield interviewed Worthington-Smith for his weekly “The Science Of” feature.

Listen to the interview in the audio below (and/or scroll down for quotes from it).

It’s not about being goody-goody… It’s all about the ability of society to put restrictions on you…

Rob Worthington-Smith, FarSightFirms

If you’re a retailer… the financial health of your customers are important…

Rob Worthington-Smith, FarSightFirms

Let’s take listeriosis… Tiger Brands, effectively, said nothing… We were more looking at the nutrition of their food… They have this wellness program which is really properly deceptive… If you’re misleading there...

Rob Worthington-Smith, FarSightFirms

Astral acknowledged that the regulatory environment wasn’t tough enough…

Rob Worthington-Smith, FarSightFirms

I saw it [Steinhoff], but only by association with the general quality of reporting... We saw little evidence [of relationship building] in their report…

Rob Worthington-Smith, FarSightFirms

Really, it’s common sense… if you’re going to manage an issue… understand it, and hold yourself accountable… use proper performance indicators… For example; don’t only measure fatalities, but also near-misses…

Rob Worthington-Smith, FarSightFirms

I’m going to be watching for honest disclosure in banking reports.

Rob Worthington-Smith, FarSightFirms

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This article first appeared on 702 : How ‘mature’ leaders create value (and how destructive immature one always are)


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