Hi Massimo, thank you so much for coming. Thanks, Franz for inviting me here. Yeah, it's a real pleasure, we've been talking about issues of conflict and ethical conundrums and how leaders have to deal with that and how difficult it can be to know, are you doing the right thing? Are your followers doing the right thing? I know that you've been working a lot with companies on those issues. I was wondering whether if you can share some of your experiences about those interactions. I was wondering whether if you can share some of your experiences about those interactions. I think this is a topic that's really important for companies. Yes. It's really important for companies and the emerging trend right now is related to the responsible leadership. Responsible leadership comes from the convergence of two main streams of research. The first one is social responsibility that sees firms as social entities within broader socio-economic context. The other one is the leadership part, So the traditional leadership models. The conversions of these becomes responsible leadership. Responsible leadership means that you should take into account all the stakeholders that are considered within the firm and external to the firm. So it means you are looking at employees on one hand, because as a leader, you influence the behavior of employees. But on the other hand, the social entity of the firm is something that has an impact also outside, so for the local community or the socio-economical context as well. So responsible leadership is the convergence of these two and has two main pillars. The first one is having a long-term orientation. So having goals that go beyond what is the quarter or the fiscal year. And go in the direction of the long-term survival of the firm and for the long-term benefits of the economical context. On the other side. So this is the legacy part? Yeah, the legacy part for the firm and the legacy part also for the leader. There is a legacy of the leader the leader. There is a legacy of the leader In terms of being a person who is able to develop his or her employee to be the successor of this leadership role. So the leader looks also on how we can develop people for being the next leader of the future. So the important shift is that this responsible leadership model is related not to the leader itself, but is related to the external part of the leader. So employees and the external social community. Interesting. In a way, the leader opens the followers’ eyes to this wider responsibility and if he or she wants to make sure that is then continued, even if, they step down, or they get promoted that there's this continuation. Exactly. This is the point. Exactly. This is the point. And recent research points out that doing this helps employees to be more motivated, so the external stakeholders are more motivated, are more engaged in the firm, are more engaged in taking this heritage part, this legacy part. On the other side we have an impact on the external community, on the external environment, that is related to reputation. Mm-hm, sure. But we don't forget that firms are also economic entities. And recent research points out that if we have this leadership style or leadership model, we will also have an economic benefit. So firms that apply a responsible leadership approach, they are more likely to generate a economic value for the economy. So we have three main goals. One that is internal, motivation and engagement for employees. On the other side, benefits for the firm in terms of reputation and for the social community. And then, the third is the economic value that is generated by the firm. So firms that are able to put the, stakeholder goals and objectives just in front of the economic goals, are more likely to gain those three kinds of advantages. And it's particularly important. Okay, very interesting. So how do you get there? How do you implement a responsible leadership model in your organization? How do you implement a responsible leadership model in your organization? Responsible leadership is a matter of culture. And the leaders should be the people who foster this culture. So it's not just a matter of a board of directors or a CEO. It's a matter of all the leaders that embrace this model. But we can have five different factors, like a pentagon that should have be oriented toward responsible leadership. The first one, like we said, is the stakeholder orientation. So we should take into account the different demands of the stake holders, internally and externally. Then there is the part related to integrity. So the leader should be able to walk the walk and talk the talk, so being able to be a person that says, does, and acts consistently. Then we have the role model. The leader should be a model. So there should be a person who makes the others learn through their example. To be the right person at the right place that develop this long-term orientation and this legacy. How do you role model such a thing? Managing external stakeholders can be fairly complex, Managing external stakeholders can be fairly complex, how do you role model that behavior? Mm-hm. You can have the people pass through training related to this “how to manage different stakeholders.” We have many examples on how we do it in terms of training, and we are helping firms to develop this kind of attitude. In terms of role modeling, we have, after the training, a cascading aspect within the organization. We have these leaders that become the ambassador within the firm about this model. We have these leaders that become the ambassador within the firm about this model. They help people to develop in this in this direction. They help people to develop in this in this direction. For example, having projects that are managed by the leader and are acted by the followers related to stakeholder consideration. The knowledge is passed- Exactly. -to the followers. Exactly. All right. Then we have the sustainability of this. So sustainability, Luke said, for example, being able to manage the, the work aspect and the personal life aspect. So a work-life balance pattern. And at the same time, being resilient, being able to bounce back when something happens. So having the energy to sustain a long-term effort. So a marathon and not just a quick race. And then we have again the disconnected to this, this long-term orientation. Long-term orientation means developing people for reaching long-term goals. And at the same time, acting for long-term goals in terms of heritage or in terms of legacy of the firm and not just play for the quarter or just play for the fiscal year. I would like to bring an example related to this. There’s a construction firm that was going to build a backbone highway, pretty long, passing through different local communities. And instead of choosing the best deal in terms of economics for choosing the subcontractors what they do is to choose subcontractors in the local community for each step of the construction. So they somehow empowered the local companies that were more responsible. Feeling more responsible for their own community. And on the other hand, they look at the stakeholder consideration. Considering what is the benefit not just for the firm, but for the external community as well. And this motivated also people in the subcontractor that felt part of this big project and felt part of this project in terms of being able to bring something very important for their context and for their people. Cool, so that's the stakeholder orientation for sure. There is the long-term orientation in there, in not thinking cost reductions right now but thinking long-term, I guess harmonious relationships with the community members. Was that the idea? So where do you see the other parts of the model? So where do you see the other parts of the model? For example, you see role modeling. So for choosing a bid, you show to your employees that you are not choosing for economic value, but you are choosing for the benefit. Okay. The others see that. Mm-hm. The others are aware of this. It’s a very visible decision that then becomes the norm, or that you want to be the norm. Exactly. You also see sustainability, because you manage something that is sustainable over time. You don't just focus on your business, but you focus on developing the community that is more sustainable also in terms of economic growth. I guess it even as a work-life balance to some degree because those local companies are building in their backyard so to speak, so their lives are affected by that. So they better do a good job, or otherwise, they suffer everyday of the year that they have to use the highway they didn't build properly. Exactly. They are actually also very close so there's not a long commute. Oh, that's true, you shortened your commute. Yes. That’s very humane. Yes. It's very local so the results of this interest in terms of this work-life balance. Very interesting. Okay. What are the big barriers in your view that companies have to overcome? What are the big barriers in your view that companies have to overcome? This seems like a compelling idea, but often, compelling ideas on paper are still very difficult to implement. I see one very big barrier. That is still most of the firms have this short-term orientation and focus on the economic value. Well, it's the pressure that they have, right? It’s not by choice. It’s not by choice. But like we said before, we can have, if we embrace this model, the same advantages that are not just economic in the long-term, that are not just economic in the long-term, But if we focus on the short-term, this model cannot work. We should think about what happens next. There are a lot of things to do. Take for example, that we run a survey to make leaders aware about their sustainable responsible leadership style and their degree of responsibility in embracing their role. And out of 100% of the index, we have around 65/66%. So there is-. From the that you've-. Yes. There are a lot of things to do for the companies. And I think the first step should be the self-awareness about who you are, and what are the impacts you can have in the long-term, on the stakeholders that are involved in your leadership role. Okay. Very interesting. Certainly food for thought. Thank you so much for sharing that. Thank you very much for inviting me.
