Professor Colin Mayer of University of Oxford On 5 Steps We Must Take To Truly Create An Inclusive, Representative, and Equitable Society
The leadership should communicate the company purpose inside and outside the organization, and ensure that the narratives convey its authentic successes, challenges and failures in achieving the purpose.
As part of our series about ‘5 Steps We Must Take To Truly Create An Inclusive, Representative, and Equitable Society’ I had the pleasure to interview Professor Colin Mayer.
Colin Mayer is Emeritus Professor of Management Studies at the Saïd Business School at the University of Oxford and Visiting Professor at the Blavatnik School of Government at the University of Oxford. He is a global expert on corporate finance, governance, and the role of the corporation. Capitalism and Crises: How to Fix Them is his most recent book and is the third in a series following on from Firm Commitment (2013) and Prosperity (2018).
Thank you so much for doing this with us! Before we dig in, our readers would like to ‘get to know you’. Can you tell us a bit about how you grew up?
I was very fortunate in having a very happy childhood, being brought up in a loving and caring family and receiving a good and enjoyable education. That was made particularly remarkable by the fact that my parents both had to flee from Germany before WW2 and therefore arrived in Britain with nothing. Despite that traumatic experience, they succeeded in not only being devoted parents but also participating actively in the local community in London in which I grew up.
Is there a particular book that made a significant impact on you? Can you share a story or explain why it resonated with you so much?
Partly as a result of my parents’ experience, the book that has made the deepest impression on me is Victor Frankl’s Man’s Search for Meaning. I quote it in my last book, Prosperity: Better Business Makes the Greater Good: As a holocaust survivor of Auschwitz and someone who lost his family in concentration camps, Victor Frankl drew on the extremity of human suffering and man’s inhumanity to man to identify the source of man’s humanity. It is in such extreme circumstances that the importance of Frankl’s phrase “it is not what you expect of life but what life expects of you” becomes clear. What the holocaust demonstrated to him was the significance of hope and love in circumstances where there appeared to be no hope: the one tree that the dying woman saw as symbolizing eternity of life; the fact that there was someone somewhere to whom everybody’s thoughts could go; the realization that there was an incomplete piece of scholarship and unresolved scientific enquiry.
This explained what every human, animal and insect seeks to achieve — some contribution, some project, something that will allow them to have left a lasting legacy however small in the world from which they can then depart in contentment. Frankl observed that it was those who lost sight of this, who felt no purpose or reason to go on living, for whom there was real misery in conditions of misery. For the others they rode above this as “angels lost in perpetual contemplation of an infinite glory”.
That was what made me really interested in the concept of purpose — our purpose as individuals — and the purpose of the organizations and institutions that we create.
Do you have a favorite “Life Lesson Quote”? Do you have a story about how that was relevant in your life or your work?
Following on from that phrase of Victor Frankl, “it is not what you expect of life but what life expects of you”, in my current book, Capitalism and Crises: How to Fix Them, I go back to one of the most significant moral concepts that features in one form or another in virtually every major religion — the Golden Rule — “do unto others as you would have them do unto you”. I say that: “enlightened as it appears its consequences have been exactly the opposite. It has created polarization not unification, self-interest not common interest, a cult of individualism not communitarianism.”
“The reason is that it is self-referential. It tells us to recognize the world beyond ourselves and to act according to the interests of others, but to do so through the lens of our own not their eyes. It imposes our not their preferences and priorities on our conduct towards them. I do to them what, were I them, I would wish them to do to me.”
In line with Frankl’s thinking, I then go on to propose “a reformulated Golden Rule of “do unto others as they would have done unto them”” and I suggest that it “requires us to regard and act towards others in a form that recognizes and respects them for who and what they really are and want to be — benefit yourselves from doing to others what truly benefits them. It is more demanding on us (and that may explain why it was not expressed that way) but its application is transformational in how we live our lives and run our institutions and organizations.”
How do you define “Leadership”? Can you explain what you mean or give an example?
This reformulation of the Golden Rule has particularly profound implications for leadership because it implies that the purpose of all our organizations — private and public, not-for-profit, philanthropic, local and global — is one thing: to help us solve the problems that you and I face as individuals, societies and the natural world, and which we cannot solve on our own. Business is an especially powerful organization for doing this because it can galvanize the human, financial and material resources that are required to do it and direct these resources towards solving some of the world’s biggest problems.
However, business has a particular challenge in doing this and that is it must solve problems in commercially viable and profitable ways. It is not charity or philanthropy. It must be profitable. Leadership has a critical role to play in defining, inspiring, and implementing corporate purposes of solving problems profitably.
Ownership of problem-solving does not just sit at the top of organizations. It must be established throughout to ensure that problem-solving is deeply embedded in the culture and values of everyone in the organization. That means that the role of leader is not just that of “commander-in-chief” but “communicator-in-chief” — to consult and communicate on what the purpose of the business is, why it is important, what problems it is there to solve for whom, the values and culture that underpin it, and how it is reflected in every part of the business and the way in which employees are rewarded.
Ok, thank you for all that. Now let’s move to the main focus of our interview. In the summer of 2020, the United States faced a very important self-reckoning about race, diversity, equality and inclusion. This is of course a huge topic. But briefly, can you share your view on what made the events of 2020 different from racial reckonings in the past?
What the death of George Floyd in May 2020 and the ensuing Black Lives Matter movement did was to elevate precisely what I have described above as the reformulated Golden Rule — “do unto others as they would have done unto them”. Recognize others for who and what they are. Help them to realize what they seek to achieve and solve the challenges and problems they face in doing that.
Can you tell our readers a bit about your experience working with initiatives to promote Diversity and Inclusion? Can you share a story with us?
I was recently involved in advising the owner of a business about transforming it into a major social as well as economic contributor to the region of Europe in which it operates. She is a visionary person who inherited a company that needed to become much more socially aware than it had been previously and contribute actively to solving problems of the local community.
In doing this, she faced a problem of convincing the management of the firm of the desirability of her vision of its purpose and ensuring that it persisted after her death. She feared that once she was no longer there to oversee it, the company would revert to becoming driven by profit and lose its social and inclusive objective.
I was able to point her in the direction of the enterprise foundations in Denmark that are owned by philanthropic foundations which determine and oversee their companies’ purposes. They are used to preserve the founders’ objectives for their firms and ensure that the wishes of the founders are retained for the indefinite future. While this could not be precisely replicated it was possible for a similar trust arrangement to be put in place that had many of the features of Danish enterprise foundations.
This may be obvious to you, but it will be helpful to spell this out. Can you articulate to our readers a few reasons why it is so important for a business or organization to have a diverse executive team?
Once one recognizes that the purpose of a company is not simply to make money and profit but to profit from solving problems for others then the need for diversity in an executive team and the board of directors in general becomes self-evident. The multiplicity of forms that corporate purposes take and the problems they are there to solve make it essential that there is a diversity of background, capabilities, education, experience, knowledge, skills, age, ethnicity, gender and nationality among the executive and board. It is this diversity at the top and throughout an organization that gives it the capacity to have a deep understanding of the issues, challenges and problems of the people and natural world that the company encounters.
Ok. Here is the main question of our discussion. You are an influential business leader. Can you please share your “5 Steps We Must Take To Truly Create An Inclusive, Representative, and Equitable Society”?
- Consult on and formulate the precise meaningful challenge and problem-solving purpose the company is there to solve.
- Create the board and executive team that is capable of and dedicated to solving those problems in commercially viable and profitable ways.
- Make sure that there is clarity throughout the organization and outside it about the nature of the company’s purpose and that everyone understands their part of the purpose and their role in contributing to it.
- Align the values, principles and culture of the organization with the purpose and establish a system of measuring and rewarding employees based on success in delivering on the company purpose.
- The leadership should communicate the company purpose inside and outside the organization, and ensure that the narratives convey its authentic successes, challenges and failures in achieving the purpose.
A company that illustrates this is the Danish pharmaceutical company, Novo Nordisk, which produces insulin that is used in the treatment of diabetes. It is a Danish enterprise foundation, to which I referred previously, which is listed on the Danish stock market and New York Stock Exchange but has a dominant owner, namely the Novo Nordisk Foundation.
What makes its story particularly interesting is that it went through a process of identifying its problem-solving process as being to defeat diabetes around the world, much of which is found in low- and middle-income countries that cannot afford to purchase insulin at the scale at which it is required. So, it identified alternative ways of treating diabetes, and changes in lifestyles and nutrition that would help people avoid getting diabetes in the first place.
Far from this undermining Novo Nordisk’s business model of producing and selling insulin at profit, its business has boomed because in the process of clarifying its purpose, embedding it in its business, measuring its performance against it and communicating its objectives and challenges, it created the most highly prized asset a company can possess — to be trustworthy and trusted. Indeed, it has recently developed a new weight losing drug, Wegovy, that is a blockbuster, making Novo Nordisk currently the most valuable company by stock market valuation in Europe.
We are going through a rough period now. What makes you optimistic about the future of the US? Can you please explain?
There has never been a more exciting time for the world in terms of both its challenges and opportunities. Remember that once one recognizes that problems are new challenges which purposeful businesses exist to solve then crises become new opportunities — opportunities to find innovative ways of solving the problems profitably. That is what the most purposeful companies did during the Covid pandemic. They recognized the potential to solve the massive number of new problems that the pandemic created. They reoriented their firms to solve these new problems and, in the process, created new customers and markets, many of which have persisted to this day.
The pace of technological advances creates new opportunities for business at a scale that we could not even have imagined a few years ago. In the process of taking advantage of these opportunities to solve new problems, business will create other problems which in turn will need to be solved. And so, we will advance through a process of identifying, creating and solving problems, which is exactly what we should be seeking of purposeful problem-solving businesses.
Is there a person in the world, or in the US, with whom you would like to have a private breakfast or lunch, and why? He or she might just see this, especially if we tag them. 🙂
Two of the most inspiring leaders of a problem-solving business are the founder and current CEO of Microsoft — Bill Gates and Satya Nadella. Their views of 21st challenges are invariably insightful and important.
How can our readers follow you online?
This was very meaningful, thank you so much. We wish you only continued success on your great work!
Professor Colin Mayer of University of Oxford On 5 Steps We Must Take To Truly Create An Inclusive… was originally published in Authority Magazine on Medium, where people are continuing the conversation by highlighting and responding to this story.