How bad is it?

The most recent Global Leadership Index report reveals a crisis of confidence in leaders on a global scale. From the most to the least trusted sector, this is how leadership ranked out of 10:

1. Non-profit - 5.53

2. Business - 4.72

3. Education - 4.70

4. International organisations - 4.62

5. Healthcare - 4.53

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6. Media - 3.94

7. Government - 3.83

8. Religious organisations - 3.57

There has been an increase in the dismissal of CEOs for ethical lapses, from 3.9 per cent in 2007-11 to 5.3 per cent in 2012-16.

According to the 2017 Edelman Trust Barometer, only 37 per cent of people now consider CEOs credible (down 12 per cent from last year).

Theo Veldsman says that although traditional research shows one out of every five leaders is toxic, he argues the figure is much closer to three out of every 10.

Is there any reason to think that law is immune from this leadership crisis? Not, according to an article in The Australian which states that the success of law firms in the next few years will depend upon effective leadership.

To succeed, leaders will also need to bring ability, stability, affinity and agility to their organisation.

Unfortunately, according to a LinkedIn survey of human resource managers in Australia, our leaders are lacking in the critical leadership skills of empathy, problem solving and creativity, and the ability to foster collaboration and innovation.

The impact of poor leadership

What is the impact of this leadership crisis? Poor leaders create poor workplaces and ultimately poor businesses. They might even shorten the life of their employees.

Swedish researchers found that if your manager is incompetent, inconsiderate, secretive or uncommunicative, you are 60 per cent more likely to suffer a heart attack.

You cannot help but think that there might be some long-term legal consequences for organisations which have such forms of leadership in the future.

Poor leadership results in workplaces filled with negativity, profits before people, high levels of stress, burnout, turnover and absenteeism, and very high levels of internal competition.

Poor leadership also results in incivility and a rise in bullying in the workplace. As a result, researchers have found that employee engagement has declined significantly in most industries, with some finding as few as 29 per cent of employees are actively engaged in their jobs.

In a time when many law firms are seeking to retain profitability and relevance, poor leadership is the last thing you want.

The treats of good leadership

What does it take to make a good leader? It might not be what you think.

Compassion

Christina Boedker from the Australian School of Business found that of all the elements in a business, the ability of a leader to be compassionate has the greatest correlation with profitability and productivity. Other researchers have also found that management styles which have the traits of compassion, integrity, gratitude, authenticity, humility and humour improve employee performance and retention, and create better client relations.

Humility

Humble leaders are more effective, better liked, have more learning-oriented teams or employee engagement and lower voluntary turnover. Findings from a Baylor University study found that, in fact, the honesty-humility personality trait is the unique predictor of job performance. Humility is so important, that Elizabeth Salib cites Google’s senior vice president, Laszlo Bock, who says humility is one of the traits he looks for when he is hiring staff.

Character

Leadership expert Jim Collins argues that the best leaders have good character including modesty, calmness, focus on the business and staff, taking responsibility for poor results and giving credit for success. Fred Kiel found that not only were staff happier when they worked for a manager with character, but the returns on assets for those organisations were five times larger than companies with executives who were more self-centred.

How can we get better leaders?

If we want better leaders, we need to:

1. Stop believing ‘tough management’ works. Putting pressure on employees increases stress, but not performance.

2. Have leadership training: If the Australian LinkedIn survey is to be believed, our managers desperately need the type of emotional intelligence training more commonly found in counselling rather than traditional leadership training. If we are going to start steering our law firms into the future, we need to start thinking and leading differently.

Anthony Mitchell, co-founder and chairman of strategic leadership firm Bendelta, confirmed this when he said: “With the death of the command-and-control age, leaders cannot expect superior performance through the militaristic exercise of authority. The winners in today’s business world are fully engaging and inspiring their people, while the losers are not. It’s that simple.”

In the words of one of the world’s most influential people, Frans de Waal, it is time we ditch the belief that life and business should be a perpetual struggle for survival with winners and losers. Now is the time to focus on empathy, co-operation and fairness.

3. Change the way we select and reward employees. Jeffrey Pfeffer’s research shows that: “The qualities we actually select for and reward in most workplaces are precisely the ones that are unlikely to produce leaders who are good for employees, or for that matter, long-term organisational performance”.

Petris Lapis is the director of Petris Lapis Pty Ltd. She is a performance consultant and an expert on mindfulness. She has worked in law, accounting and banking, and presents conferences and seminars to professionals around Australia.