Industrial society is undergoing the cultural equivalent of climate change

“CEOs are now less able to focus only on the economic and business levers (and leave everything else to organisational structure) when faced with this barrage of new challenges”

On November 12, 2022, Jeff Bezos revealed in a televised interview, broadscast on CNN in the USA, that he was pledging to give away $124bn of his net worth to support people and causes that can unify humanity in the face of deep social and political divisions. Just two days later the New York Times announced the planned dismissal of 18,000 employees from the company that grew Bezos’ wealth for him: Amazon. That the announcement was timed just before the start of the Christmas vacation to take effect in early January was just one more blow to those losing their livelihood and an indicator of the peculiar narrative that tries to discuss concerns for humanity without recognising that humanity consists of the individual humans, like those Amazon employees, beings made redundant. It would appear that the halcyon days of the benevolent employer are truly long gone.

On the one hand, the enormous wealth accumulated by the leading companies listed on the New York Stock Exchange might be seen to represent one of the successes of liberal politics. On the other hand, the seemingly callous treatment of their employees in the quest for endless growth and shareholder profit would seem to reflect a failure of liberalism. After all, a free society is as much a moral achievement as it is an economic or political one. The failure to reconcile the two is fundamentally an abdication of responsibility and, more directly, a failure of leadership: a failure so potentially catastrophic that it places at risk liberalism itself. At the heart of this contested space is the world of work. To reflect on this world is to do no less than to reflect on the kind of society and culture we want and hope to achieve.

What is apparent to anybody who cares to look and see is a fracturing of the acceptance of the world of work as a key existential determinant of meaning in our lives. It is one reason, aside from financial hardship, why the lockdowns enforced during the pandemic proved so devastating for those whose opportunity to work was removed. They accompanied a growing loss of trust in public institutions as well as the large corporations of private sectors, such as banking, and even scepticism of the professionalism assumed to be implicit in the professions themselves, such as law and accounting; a rise of “populist” politics and a shift towards the extremes of the left and the right; and an increasing dissatisfaction and frustration with the failure of governments to address the fundamental problems threatening all of humanity. 

Whilst this crisis is as much one of poor leadership, it is more broadly a crisis created by neglect and a failure to recognise and understand the importance in liberal society of morality in the power of “we” over the corrosiveness of “I”. The obvious consequence of the decline of the benevolent employer and the rise of possessive individualism is a withering on the vine of compassion and care for others, the decline of the preferencing of justice over individual rights, and a shift towards sole consideration of what is good for me away from what is good for all-of-us is also good for me. In many respects, the world of work has been core to engendering that collective ethic: from working together to bring in the harvest through to all sharing in responsibility to keep a company afloat in hard times if only to ensure jobs will be maintained. It’s central to all indigenous communities. It’s an attitude expressed by Dixons Carphone (UK) group chief executive, Alex Balcock, in deciding to take £10m of the company profits in 2018 and give 30,000 staff £1,000-worth of shares in the company: not because the company was hugely successful but, on the contrary, there were “headwinds and uncertainty” facing the business. As Balcock stated when announcing the three-year share distribution scheme, “by making every colleague a shareholder we are engaging our colleagues behind the vision and strategy”.

The historian, Bernard Lewis, encapsulated the emerging state of populist politics twenty years ago in his 2003 essay on political and religious tolerance published in The Atlantic: “I’m right, you’re wrong, go to hell”. Fourteen years later, in 2017, contrary to British MP Tony Blair’s triumphalist anthem of the 90s, D-Ream’s song “things can only get better”, things had only gotten a hell of a lot worse, leading the former editor-in-chief of The Economist, Bill Emmott, to pen ‘The Fate of the West: the Battle to Save the World’s Most Successful Idea’ and a contention that Western society (the poster child for liberalism) is, “demoralised, decadent, deflating, demographically challenged, divided, disintegrating, dysfunctional, declining”. What hope then for rescuing corporate culture from the mire?

Industrial society is undergoing the cultural equivalent of climate change. The current pandemic, whilst not the cause, has accelerated the rate of change and exposed the growing threats to societal freedom brought about by a political and economic surrender to possessive individualism over a concern for the collective good and, in the workplace, a well-meaning but dangerous laissez-faire approach to corporate leadership: the executive will take care of the financial levers of the organisation, company culture will take of itself.

Although such a bold statement requires some argument and justification, the growing sense of unease in the workplace – expressed through concerns about “toxic” cultures, over-work, bullying, silo wars, myopic CEOs, a senior executive detached from other employees, dysfunctional Boards, and shareholder interests pursued at the cost of staff dissatisfaction and low morale – has become increasingly visible in the context of discussions around the 4-day week, the return to the office, and the new resignation. Most of these discussions illustrate the debilitating ennui, felt by many, that work no longer provides the meaning and purpose it once might have and those with options to seek more a meaningful balance between work, family and leisure are voting with their feet. If the workplace is a microcosm of society at large, then it seems as Hamlet’s Marcellus tells us, “something’s rotten in the state of Denmark”.

Amazon’s and others’ employees, after all, are individual constituents of the “humanity” that Bezos wishes to save. They don’t leave their cares and troubles behind when they walk through the reception lobby and exist between 9am and 5pm as working machines, removed and abstracted from everyday concerns, dutifully unpacking their corporate persona, along with their laptops, for the sake of the company. On the contrary, employees (particularly of the younger generations) are more openly questioning the working culture of the employer. They take greater interest in their company’s corporate ethics – and whether it lives up to them – and are more vociferously challenging whether or not the company values posted on every wall are truly lived or simply representing the latest strategic review from the former “human resources” unit, now re-packaged as “people and culture”.

But hang on a minute . . . in spite of this grand malaise, on a personal level the living standards for the majority of people in the West exist at standards only dreamed of three or four generations ago. The ironic “party pooper” of the pandemic has been the constraint on consumerism: an inability to travel, to buy new cars that can’t be built, to deny us an annual holiday at home or abroad, and to prevent any therapeutic splurge on consumer goods, all of which we’ve taken for granted by right. In general, life expectancy has increased, premature death from illness is on the decline, education at all levels is increasingly available to more and more people, and unemployment levels are consistently low. 

So, why are so many people so unhappy? Data from nearly all developed countries reveal increasing death rates from drug overdoses – the figures from the USA show a doubling in the decade from 2010-2020 and a tripling since the turn of the century – suicide rates amongst middle-aged men on the rise and a worrying new set of statistics about our teenagers that reveals anxiety and depression to be the most serious medical issues facing adolescents. Drawing on survey data and numerous in-depth interviews from over 11 million young people born between 1995 and 2012, the American researcher Jean Twenge has identified our newest set of teenagers emerging into adulthood, the “iGeneration”, as less happy than previous generations and completely unprepared for adult life: the physically safest generation ever is, paradoxically, “the most mentally fragile”.

That these broader societal pressures and cultural changes are impacting the workplace is inevitable. CEOs are now less able to focus only on the economic and business levers (and leave everything else to organisational structure) when faced with this barrage of new challenges:

·      An increasing perception of what the philosopher Martha Nussbaum termed, “the fragility of goodness” and the growing sense of unease and anxiety amongst the general populace that drives a more insular and protective self-interest, at odds with a sense of collective responsibility and a desire for “belonging” to the company;

·      The change in employment demographics as the baby boomers who have built and structured the post-war corporations retire and “Gen-X” and “millennials” seek greater influence on company organisation and the hierarchical structures that have constrained them;

·      Increasing noise coming from the younger generations, constituting a larger proportion of the workforce, who believe their opinions are as valid as their boss’s and who demand more of a voice;

·      An employment market where shortage of talent is shifting the balance of power from the employer to the employee in possession of in-demand skills who is prioritising workplace culture and development opportunities over brand and salary;

·      New employees entering the workforce who are the “mentally fragile” iGeneration who “wear” their troubles and concerns more openly on the outside than their comparatively bland and compliant grand-parents;

·      The post-pandemic effect of questioning the meaning and value of work with a shift towards seeking greater freedom over lifestyle choices and a desire to diffuse the distinctions between work and leisure;

·      The shift from a blind acceptance of workplace culture, as endured by previous generations, to a more demonstrative rebellion against unfairness, inequality, poor working conditions, and a general neglect of the workforce. 

These challenges place an enormous strain on cultural maintenance and the adoption of shared values that are lived and breathed by all participants in the organisation. The new-era CEO cannot hope to succeed, in the long term, quietly but consciously dismissing responsibility for internal corporate culture, or abdicating responsibility to the under-funded, under-resourced, under-valued cost-centre now called “People & Culture”, on the assumption that cultural issues can be structured out and destabilising behaviours managed by more explicit rules, “performance improvement plans” and more punitive “actions”. 

Responsibility for a company’s culture is the chief function of leadership and sits firmly with the CEO, alongside the Board and, conversely, blame for a poor culture cannot be deferred to P&C or line-of-business managers: “the fish rots from the head” as the old adage goes – a view echoed in the title of Bob Garratt’s best-selling book on the crisis in our boardrooms.

“we can no longer prescribe to a view that business is narrowly economic, somehow objective and independent of human concerns, focused just on profits and financial value”

At the heart of this requirement from the new era CEO is the demand for ethical leadership. If the moral, economic, and political dimensions are to work harmoniously in the maintenance of a liberal society then business and ethics must go together: economic interests and broader human interests need to be integrated into our business models. The broader issues facing us, outlined above, mean that we can no longer prescribe to a view that business is narrowly economic, somehow objective and independent of human concerns, focused just on profits and financial value. The starting point in this re-appraisal is the internal culture of the company itself along with the meaning and value of work.

Unfortunately, most corporate CEOs are ill-equipped to realise the extent of the problem yet alone do anything about it. The days when CEOs more often than not came from the world of graduates in humanities, social sciences, arts, and PPE (politics, philosophy and economics) have been replaced by an era in which CEOs have more generally pursued from the outset a career path beginning with a university degree in accounting, business, commerce, economics or financial management. That they lack a “sociological imagination” is hardly their fault. But how do they get one?

It’s easy to dismiss these grand ideals as impractical. Many would argue that the only responsibility is to shareholders and it’s just not the job of the company to guarantee anybody a job. But that would fail to see the potential benefits to all stakeholders of valuing employee experience (EX) as much as customer experience (CX). It might seem impossible to build an office culture when there’s no longer anybody in the office; the development of “teams” can seem to be merely the use of a software communication tool rather than the meaningful creation of a new agile mode of operating; the sense of “belonging” to a family as much as a brand might appear lost to a workforce that priorities its own family’s interests over those of its employer; and the promotion of “collaboration” is surely just a buzz-word when departmental work is more often asynchronous than synchronous. 

None of these things are impossible to generate and, in fact, they are not only demonstrably achievable but also have never been more important for us to aspire to. The challenge for the new era CEO is to take responsibility for leading an employee-focused organisation: an organisation with a culture that self-governs through shared values not rules; that creates meaningful work and not just roles and job descriptions; that manages performance through coaching, mentorship and employee self-development; that promotes personal growth, purpose, and employee experience; and that recognises the individual employee desire for the autonomy to create a working environment that includes human interaction, personal fulfilment, and the full utilisation of the skills, abilities and energies at their disposal. Companies that achieve these goals will be the success stories of the decades to come. Moreover, they will contribute to slowing, and even reversing, the threat of cultural “climate” change.

How the CEO does these things will be the subject of the next instalments of this series on: (1) creating a self-perpetuating culture; (2) engineering an organisation driven by capability not jobs; (3) capturing the value of teams; (4) fostering continuous improvement and performance without KPIs; and (5) creating an ethical organisation. Each topic will address these challenges in the context of the shift to remote working and hybrid workplaces and the balancing of shareholder expectations with ethical leadership.

About the author:

Dr Simon Eassom is Founder and CEO of ‘Futures in Focus’, providing consulting services on leadership, corporate culture, and change management