The Risk of Leadership

Leadership

A plea for a new search for ‘responsible-in-the-end’ leadership: stewardship

Jack Kruf | 10 March 2017


Of course, we have our democratic system as a great set of principles and values as a form of equipment for good public governance. Public leadership, concerning that of public organisations as well as of the public domain of society, is embedded in this system, at least it should be. You may expect excellent results, because the democratic system traces back to the Greek δημοκρατία 508 BC, and itself is tested and challenged over and over again. Through the millennia it developed until now.

Considering the present state of society and of natural ecosystems you may be surprised by the results of this period of 2525 years of development. The Global Risks Reports published by the World Economic Forum – published since 2005 – tell the story of how critical the earth condition is. Reading these reports I had a flashback to the year 1972 when the Club of Rome presented facts, findings and figures in the report The Limits to Growth. Since at least five decades (i.e. half a century!) we know what is going on and where many generations of leadership has brought us.

Not that good
Within this democratic system the results of our public leadership over the years are not that good. Autocratic systems perform not better. More than ever public risks – being deviations, harms and losses related to the public values we so highly pamper – seem to emerge at a faster pace – such as there are disruptions caused by climate change and cybercrime, large scale pollution and poverty, fundamental lack of social cohesion, water shortage and migration issues. Well, what can we say about risk leadership while leadership itself seems to be the risk? We elaborate on this.

Redefinition
Public leadership must be reconsidered against the background of the structural and diminishing trust of citizens in politics as a whole as well as in public organisations. In society you more and more sense and hear Houston we have a problem. The general feeling is that public leaders do not listen to citizens and companies, are perceived as the ‘elite’, do not act in line with their promises during election time. What makes things worse is the disappearance of public leaders after a governing period of 4 – 6 year, when their term has come to an end, and make place for a new wave politicians, all with new promises.

It seems that risk leadership itself has become a risk

There seems to be much governance from the board room and from behind the desk. The living world of society seems to be separated from the ruling system world, where the leaders actually live in. There is this hugely felt need under citizens, clients, companies and if they could talk to us by natural ecosystems as forests and coral reefs – for leaders that listen to the wants and needs and from there truly generate values as safety, balance, cohesion, continuity, predictability, protection and security. There are gaps and risks (as form of harms and losses to values), all over the place. 

From this perspective it is obvious that managing and governing the public risks, that emerge in society – well defined as risk leadership – needs to be redefined. It seems that leadership itself has become a risk factor. The so called risk leaders who cause risks in stead of leading us in the prevention, approach, mitigation and management. That is worrying, because the right course of public governance, anchored in the basic of democracy, depends on this. This aspect of weakness in leadership should at least lead to a continuing process of self-reflection, improved self-awareness and self-correction.

St. Thomas University: “The Risk Leadership Initiative is focused on several aspects of modern risk management, but one of our key issues of concern is the challenge of getting organisational leaders to integrate risk management thinking into their overall decision-making frameworks. Since PRIMO has, from the beginning in 2005, been focused on top level leaders we would be interested to hear your views on the problems, opportunities, and challenges of getting risk management included in executive, politician, and director level policy making and policy implementation. Examples of successes would be particularly interesting to us. Jack Kruf: “It is clear that leaders of public and private organisations should play a coordinating and connecting role in a more holistic approach of the risks we are facing. This well written and illustrated report impressively highlights where we find the challenges on our path toward a more balanced society. Sharing knowledge, open dialogue, building trust, good governance, stewardship and leadership.””

Political risk
In present think tanks has been brought forward by different stakeholders, the impressions that society itself is on a drift and that it seems that the democratic set of tools is running out of its ability to control. In the outcome and result of many elections and referenda it more and more becomes evident that the drift in risks, for society in public risks, finds ground in political leadership and hereto related components. Reflecting on risk leadership brings us automatically from the academic and management domain in the direction of politics.

According Niccolò Machiavelli politics is the world of mainly that of power and influence. Is then politics one of the key drivers of public risk itself? Is the quest of risk leadership in fact all about the risk of politics or political risk? It is possible. Zooming in a bit more here. What is political risk? Matthee (2011) defines it as follows:

‘Political risk is a type of risk faced by investors, corporations, and governments that political decisions, events, or conditions will significantly affect the profitability of a business actor or the expected value of a given economic action.’ 

In a broader definition also citizens and communities should find resort in this definition. Anyway, politics is an obvious dimension that brings harm. An important aspect to build in the new program of Professor Peter Young. It leads in my view to the conclusion that risk leadership at least needs to embrace itself and for its practical applicability and use has to be upgraded, maybe even reconsidered, redefined, re-invented or re-engineered. In the public domain of day to day business and government, it means that this attitude of self reflection needs be applied to every elected and governing council, the place where politics actually emerge.

It has become clear from the European UDITE and PRIMO network that many city managers express the general feeling – from extensive experience with society, citizens, clients, investors, businesses, NGO’s and media – that this unpredictable working of politics has become a critical factor and express that the system of democracy itself is under pressure.

The unpredictable working of politics has become a critical factor

What is leadership if “democracy is the worst form of government, except for all the others.” (Churchill). What is in perspective of the emerging public risks in fact the ability of democracy? Gore (2009) reflected as follows:

”It is now apparent that the climate crisis is posing an unprecedented threat… to our assumptions about the ability of democracy and capitalism to recognize this threat for what it is and respond…”.

These doubts in and lack of trust in de governing system, where leaders live, form the background for a further reflection on leadership, especially when it concerns risks for citizens, society and nature.

Stewardship
Discussing the major public risks within the European network of public leaders the main concept for leadership that addresses and mitigates is felt in the form of stewardship, not (only) in the religious way but as a form that has a true holistic approach. We remember here the great Alexander von Humboldt and his holistic approach over the borders of sciences in the early 19th century. He essentially connected sciences and approaches and with that crossed the lines of segmentation of opinions and views into a true ecological approach of areas and topics. Could his approach be a starting point for a more successful approach of public leadership, connecting vertically detail with headline, strategy with implementation and horizontally all relevant stakeholders. This way of perception could be beneficial and a great asset for modern leaders.

Alexander von Humboldt connected sciences… and with that crossed the lines of segmentation. 

Elaborate a little bit more on Von Humboldt. To be able seeing things as one and interconnected is the capacity of true ‘reflection’ needed, i.e. the capacity zooming out and seeing the larger picture, in connecting the dots. Like Alexander von Humboldt did in his 1858 masterwork (Cosmos part I). He for the first time in history connected the different sciences of the living and non-living world. He concluded: “Physical geography…, elevated to a higher point of view, … embraces the sphere of organic life…”. That was a great discovery and a major lesson to be able to connect the dots.

On governing cities and regions this reflection can be of great advantage in diagnosing the problem and define actions. Reflection is needed to get the bigger picture of things, people and happenings and to develop a sabbatical and clear view how to lead. It helps leaders getting the bigger picture, see more sharply the connection of elements within the public domain and thereby contribute to better decision making and putting things in perspective.

Change

From the network of PRIMO comes the experience that most of the public risks emerge from firstly lack of reflection capacity by leaders and with that insufficient diagnoses causes ineffective decisions. Only 12% of policies leads to implementation and from this only 25% is effective. Secondly lack of good working interfaces between stakeholders caused by a lack of binding leadership and thirdly by what can be defined as responsible-in-the-end leadership, i.e. stewardship. The last being an ethic that embodies the responsible planning and management of resources.

The concept of Risk Leadership can be possibly enriched with key leader capacities of reflection, connection and stewardship. In my view these can contribute to the reduction of risks, caused by leaders themselves and improve the quality of public and private governance and management in general. The initiative of Risk Leadership by the St. Thomas University could not have been timed better in this timeframe of changing paradigms, drifting societies and on a large scale emerging public risks. It is time for change. Ω


Bibliography

Gore, A. (2009) Our Choice: Changing the way we think. Emmaus, US: Rodale Books.

Matthee, H. (2011) ‘Political risk analysis’ in Badie, B., Berg-Schlosser, D., & Morlino, L. (eds.), International encyclopedia of political science (pp. 2011-2014). Thousand Oaks, CA: SAGE Publications Inc. doi:10.4135/9781412959636.n457

This article was originally published to contribute to the Risk Leadership Initiative of the Opus College of Business of the University of St. Thomas, lead by Professor Peter Young. As published here the article has been amended on its original in formulation and positioning. Hyperlinks and biography are added. The publishing date has been kept on its original: 10 March 2017.

 © Jack Kruf photo: Ludwig Oswald Wenckebach (1955) Monsieur Jacques [Bronze]. Rotterdam.