Call for CEOs to tackle wider interests of society, environment

Mr Rajeev Peshawaria said the board had a crucial role of putting the right CEO in place. ST PHOTO: ALPHONSUS CHERN

SINGAPORE - A new era of corporate leadership requires chief executives to become steward leaders capable of not only growing shareholder value, but also taking care of the interests of a broader ecosystem of stakeholders that includes employees, customers, the environment and society at large.

That was the key message from Stewardship Asia Centre chief executive Rajeev Peshawaria in his address to delegates at the Stewardship Asia Roundtable 2022 on Thursday (March 31).

"Today's corporate leader is not one with the highest title or authority," he said. "Today's leader will be defined by his or her genuine desire and persistence to create a better future."

To do this, a corporate leader has to not only take care of shareholder value, but also the interests of the broader society.

Mr Peshawaria insisted that CEOs and corporate leaders can drive superior shareholder returns by addressing the very challenges threatening the planet and humanity, because clients, investors and markets increasingly gravitate to socially responsible companies.

He pointed to companies such as Unilever, Starbucks and the Tata group as "companies which had done well by doing good" by balancing profitability with social conscience.

"Doing well by doing good is both possible and practical, but it will require a new lens," he noted, adding that leadership is the genuine desire and persistence to create a better culture, and stewardship is about creating value.

Meanwhile, stewardship is creating value by integrating the needs of stakeholders, society, future generations and the environment.

A good steward leader has to abide by four simple - but not simplistic - rules, he added.

First is interdependence, which is the realisation that the world is interconnected and one's success depends on the success of others.

Second, steward leaders must take a long-term view to create sustainable value.

Third, steward leadership requires taking ownership, where leaders take proactive responsibility for being steward leaders.

Fourth, steward leaders must display creative resilience by developing tenacity to find innovative solutions to disruptive challenges.

Asked by CNN Business news anchor and editor-at-large Richard Quest about the role of directors in all this, Mr Peshawaria said the board had a crucial role of putting the right CEO in place.

"Steward leadership is an art, not a science," he said.

"As a CEO, your heart should know what is right and what is wrong. Leaders must have the wherewithal to uphold the right values even when it is inconvenient to do so."

The board has a role in identifying such a person.

But steward leadership is not easy, Mr Peshawaria added.

He cited the late South African freedom fighter and president Nelson Mandela, who upheld the value of forgiveness and reconciliation, even if it meant losing his wife and children - who disagreed with him - in the process.

"As a CEO, you can do whatever you want to do," he said.

"But you cannot be a true leader or a steward unless you have the right values.

"Take baby steps with a full heart and the right intention."

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