Chairman of Woolworths and Origin Energy, Gordon Cairns, says he cannot remember a time in his career when business leaders were less respected.

“The theme coming out of the [Banking] Royal Commission – and I am on the board of [Macquarie] bank – is one of dishonesty, where driving profit is actually seen as the polar opposite to serving the customer … and where more regulation now is seen as the antidote to poor leadership,” Cairns told a recent Sydney gathering.

“It is worse than the political arena. I’ve worked in three continents – the UK, America and in Australia –and I actually fear for all of them.”

He said the situation had reached a nadir when the excuse for imposing a tax on the banks is because “everyone hates them” and the reason for pricing regulation in the energy sector is because “the retailers are gouging their customers”.

Cairns has a reputation as a plain-speaking Scotsman, frequently sharing his own leadership story to illustrate how authentic, self-aware leaders can transform whole organisations.

He was appointed CEO of the beverage company Lion Nathan in 1996 and engaged leadership consultancy Human Synergistics to conduct 360-degree reviews of staff. These reviews laid out how individuals were viewed by those they reported to, worked alongside and led.

His own results were abysmal – flooded with aggressive and defensive character traits (coded red in the results, as opposed to the more productive and affiliative blue).

Speaking in November at a Sydney event, hosted by coaching company Stephenson Mansell Group, Cairns spoke about what he has learned about leadership.

First, he says, the best organisations recognise that they are a social community of people who join voluntarily for a shared moral purpose. “They are neither an army, nor a machine. And our job as leaders is to inspire them with that noble purpose.”

Second, leaders get results and the “how” you get there is as important as the “what” you achieve.

“And to this point, leadership is mathematical. I remember having a conversation with Kevin Rudd and he said ‘What is the most important ingredient in leadership?’ And I said ‘Prime Minister, you have to have followers’. He said: ‘What do you mean?’

“If you are not getting results, people will not follow you. And, if you have no followers, then you have no-one to lead.” 

Cairns said his third lesson was that leaders are prepared to undergo a profound change in themselves. He saw the necessity for that when he received his own 360-degree review at Lion Nathan, which he left in 2004.

“So this is what is known as an ‘Aha moment’. I would actually describe it as an ‘Oh shit moment’.

“So, I go into the office the next day and I go to the HR director [Bob Barbour] and say, ‘Well you are going to have to be my coach. When I do something well, can you praise me in public? When I do something bad, could you take me aside and quietly just tell me. And we are going to have that trusting relationship’.

“The next thing I did was publish my 360-degree [report] to the 7,000 people in the organisation. This was somewhat foolhardy because, as I go around the organisation to talk to people, they would always have their 360-degree on their credenza and I would say ‘Oh, is that your 360-degree? That looks very good’ and they would say ‘Nowhere as bad as yours’.”

Cairns then asked around for an executive coach and was recommended, Tony Grant,
Professor of Coaching Psychology at the University of Sydney.

“So I called Tony up and said ‘Tony, I am a basket case and I need help’,” explains Cairns.

Grant told him to come at 5.30 on Wednesday.

“I said, ‘Tony, you don’t understand. I am very important. My diary is full, I cannot possibly get there on Wednesday’.

“He said, ‘That’s okay. Don’t come’.

“I said, ‘Okay, let’s negotiate. Instead of 5.30 in the evening, let’s make it 6 o’clock’.

“He said ‘It is not in the evening, it is the morning’.

“I said ‘Tony, you don’t understand. I like to get up in the morning. I like to meditate. It is good for my soul. I like to go to the gym’.

“He said, ‘We have had this conversation. Don’t come’.”

Cairns says the point of that conversation was that if becoming a better leader was not the most important thing in Cairns’ life, why should Grant – a renowned expert – waste his time?

Every week for five years, Cairns visited Grant and the results were spectacular. By the time Cairns left Lion Nathan, the formerly underperforming company had an employee engagement score in the 90 percent range, which indicates a very high level of buy-in from motivated staff.

“Human Synergistics had never seen a transformation of a company, so fast and so dramatic ever. The total return for shareholders was in the top quartile in the world – 22 per cent over a five-year period. I can honestly say, I became a better father, a better husband, and a better leader,” says Cairns.

In the bear-pit of the House of Commons, the Government and Opposition benches are precisely placed two sword-lengths apart. If that doesn’t tell you about the standards of behaviour expected of our politicians, nothing will.

Former Foreign Minister and Deputy Prime Minister, Julie Bishop, says she has witnessed behaviour that would not be “tolerated in any other workplace across Australia”.

Observers from other nations have been sometimes lavish in their condemnation of the goings-on in the nation’s capital. Matthew Engel in The Financial Times judged Australia the worst of all the “crazy parliaments” he had observed in 2012.

“The only thing the MPs can do,” wrote Engel, “is overthrow their leaders, which they do with great zest, in the manner of Roman slaves celebrating Saturnalia.”

Such is the public distaste for the taunting and name-calling that parents often use Question Time conduct as an example to their children of what not to do at primary school.

Is bullying getting worse?

In recent months, the standards of behaviour became a topic for discussion once again when Liberal Party women spoke out against bullying and the lack of female representation among party MPs.

With a Party ideology that celebrates individualism, rather than collective action, photographs of Liberal women co-ordinating their wardrobes to wear “Handmaid’s Tale” red in question time in Question Time created a stir.

This uncharacteristic outspokenness about their own colleagues may have led to the impression that the traditionally-bad behaviour is getting worse. But is this really the case?

Dr Marija Taflaga is a researcher in the School of Politics & International Relations at the Australian National University and has been studying this very question.

Taflaga says, over the past 22 years, aggression levels have ebbed and flowed. Overall behaviour (while perhaps considered unacceptable elsewhere) is now less aggressive than during the minority Government of Labor’s Julia Gillard.

Incivility, measured as a “ferocity index”, rises significantly when there is more at stake, trying to pass significant legislation, or during “hung parliaments” –  this does not auger well for the next six months until the next Federal election.

A change in tactics

Other factors encouraging poor behaviour are the televising of Question Time, which provides a more public platform for those who want to show dominance over the other side.

“The Australian Parliament has always been a pretty robust place,” says Taflaga, who has also worked in the Australian Parliamentary Press Gallery as a researcher at The Sydney Morning Herald and The Age.

Politicians’ behaviour may not be not much worse than usual, but what we are seeing is a change in tactics, she says.

“Both sides of politics have kind of learned to engage in a lot of trash talk … and then just pass legislation anyway.”

There has also been an increase in contrarian behaviour, with leaders “shutting” down constructive debate with “binary” responses to complex problems.

Influence of Abbott

Abbott’s skill at simplifying debate did make the parliament more aggressive, she says.

“One person is trying to open up a conversation and the other one is constantly shutting it down and that is what Tony Abbott was really good at. And he was really good at shutting it down under his terms, such as [saying] ‘Stop the boats’ or ‘Axe the tax’.

“That lessens the opportunity to have a civil discussion. It effectively increases the temperature because one side is still trying to prosecute their argument, while the other side is basically refusing to engage except on these really narrow terms.  And when you simplify things down, there is no nuance and it’s actually nuance that brings in the  possibility for compromise.”

While there are protocols to moderate behaviour on the floor of the house (even if it only forces withdrawals or expulsion after the event has taken place), it is difficult to grade conduct that occurs in the offices and hallways, because it is unrecorded and much of it occurs in private.

Liberal women outnumbered

Taflaga’s observations about the complaints of the Liberal Party women is that because there are so few of them, it is harder for them to change the culture.

“A woman who’s made it into politics is pretty tough. It’s a hard business to get into. It’s not like business or a law firm where there are the same kinds of rules that are enforced by a human resources department.”

Taflaga says research into female MPs in the UK finds that more than half of them say they faced gender discrimination during their selection or election.

“They thought that business was a tough environment, but they had excelled at it, but here they are in parliament and they are being treated systematically differently,” she says.

The Australian female MP complaints of bullying should be taken seriously, she says. “There’s a lot at stake for them to say those things. There are a lot of cultural and organisational pressures to not say those things – yet they are still saying it. So we should absolutely take it seriously.”

Politics not for the faint-hearted

In this, Taflaga is echoing the comments of Julie Bishop who, said: “I have seen and witnessed and experienced some appalling behaviour in parliament, the kind of behaviour that 20 years ago when I was managing partner of a law firm of 200 employees I would never have accepted”.

Bishop was commenting after MP Julia Banks cited bullying and intimidation as a factor in her retirement from politics.

“Politics is robust, the very nature of it, it’s not for the faint-hearted,” said Bishop.

“[But] when a feisty, amazing woman like Julia Banks says this environment is not for me, don’t say: ‘Toughen up, princess.’ Say: ‘Enough is enough’

Taflaga says she would like to be able to study whether a better gender balance would improve standards of behaviour and is looking for funding for this project.

Lacking the quota system that has boosted Labor’s female MPs to 46 percent, the proportion of Coalition women has slipped to around 24 per cent.

“A lot of women find the aggressiveness of parliament confronting. And we do know that women tend to find committee work, that more deliberative style, more to their taste. And, of course, there is a penalty as a female, for being seen to be very aggressive.”

What can be done?

Looking around the world, Taflaga notes that some differences help dial down the ferocity of other parliaments.

•  Shorter Question Time: Most of the bad behaviour occurs in Question Time, which is held every day for one hour in sitting weeks in Australia. In the UK, Prime Minister’s Questions are just half an hour each week and the questions are known in advance, so it becomes less likely to be “gotcha!” time-wasting.

•  More impartial speakers: Poor behaviour is encouraged by having partisan speakers, who are not even-handed in regulating the house.

•  Longer parliamentary terms: In the UK, terms are five years, compared to three years in Australia. A longer term gives a Government more time to govern before taking up the cudgels for the next election.

•  Engaging the Opposition: Find ways to allow the Opposition to make a more constructive contribution, in cross-party committees for instance, where they must work together as they do in the Senate.

•  Rearrange the benches: Rather than having opposing sides two sword-lengths apart, the Scottish Parliament is arranged like a horseshoe.

Taflaga says it is worth trying to get MPs to behave. “Parliament is always a tough business and it’s always going to be tough, but that’s not an excuse to not change things”.

When people were getting shouty about the same-sex marriage issue last year, it must have seemed like a great idea for a company to support a campaign calling for constructive and respectful debate.

What could go wrong?

Answer: for a proudly Christian-owned beer company, just about everything.

The Adelaide-based Coopers Brewery was dipping its toe into the pool of corporate social activism by supporting a Bible Society video debate. In it, two Liberal Party MPs were voicing opposing pro and anti same-sex marriage views. Instead of a diplomatic hurrah, the result was a painful and embarrassing public relations belly-flop.

In less than a week of making national news, the brewery had put out two press releases; one defending its involvement and the other distancing itself. This resulted in them facing community and social media backlash and a product boycott by both customer and publican.

Social commentator and advertising writer, Jane Caro, says companies and their CEOs have every right to state a point of view, but there is a wrong and a right way to go about it.

“What they didn’t do was ‘out’ themselves as a company with strong Christian values,” she says.

“You have to own up to who you are.”

“The ethical thing to do is own up to your bias. It doesn’t mean you can’t have one [a bias], it means you own up to it.”

You may be criticised for your view, she says, but you will not be branded a hypocrite.

‘Stick to your knitting’ – Dutton

During the same heated discussions leading to the Same-Sex Marriage referendum last year, Qantas CEO Alan Joyce was publicly reprimanded for his outspokenness on the issue by former Immigration (now Home Affairs) Minister Peter Dutton, who said business leaders should “stick to their knitting”.

“Alan Joyce, the individual, is perfectly entitled to campaign for and spend his hard-earned money on any issue he sees fit, but don’t do it in the official capacity and with shareholders’ money,” said Dutton.

“And certainly don’t use an iconic brand and the might of a multi-billion-dollar business on issues best left to the judgment of individuals and elected decision-makers,”

Joyce, who also donated $1 million of his own money to the Yes campaign, has been an “out” gay man for a long time and there was no confusion about where he stood on marriage equality, says Caro.

He was also backed by the Qantas board, which had sought the views of major shareholders, staff and customers before he made his stand.  His voice was also amongst another 131 large businesses who have publicly supported the marriage equality campaign.

Leaders have a social responsibility

Caro says it is part of a CEO’s job to look at the ethical basis of a company.

“You can’t go through life being a moral vacuum. You can’t go through life having no opinion. CEO’s have to have a point of view on climate change, they have to have a point of view on equal rights for LGBTQI people, for women and for people of colour,” she says.

“And, particularly, people are demanding to know what the attitudes of a company are before they got to work for them.

Research by Weber Shandwick and KRC Research backs this up. A poll of 1,021 adults in the US last year finds that the younger you are, the more likely it is that you will expect corporate leaders to speak up on social issues.

Around 47 percent of Millennials (aged around 22-37) say CEOs have a responsibility to speak up. Of their elders, 28 percent agreed with them. Younger people are also more likely to buy from a company where the CEO spoke out on an issue with which they agree.

Says Caro: “If you’re a gay person, and you’re married, you wouldn’t want to go work for a company which disapproved of that or where you had to pretend you weren’t.”

CEO’s should ‘grow a backbone’ 

But should CEOs speak out on topics that have little to do with their business?

American marketing professor, Gene Del Vecchio, advises CEOs to shut up, only fight when the issues have a direct impact on the business and not to pander in a shallow attempt to gain business. If CEOs decide to communicate their opinions, they should ensure they cannot be misunderstood.

They should also consider the unintended consequences of projecting their views and “grow a backbone” to resist threats, pressure groups and entreaties.

“Whether you are being threatened by activists on the left or the right, the more you yield to their demands today, the more they will demand of you tomorrow, which increases their control of your future business,” wrote Del Vecchio in the Huffington Post.

“ … if you are a CEO of a publicly held company, your fiduciary responsibility is to shareholders, many of whom are invested in your company via large mutual funds that reflect a wide swath of investors from the political spectrum. You owe it to them to make money to support their retirement, not to express your personal opinion on sensitive issues that many may not agree with.”

The rise of progressive activism

Corporate social activism is not new. CEOs have always played a role as moral standard-bearers. In 1914, industrialist Henry Ford doubled the salaries of his workers who lived “moral” lives and hired a department of 200 inspectors to ensure they were not getting drunk or neglecting their families. He also published an anti-smoking book.

In the UK, the Lever brothers built a company town, Port Sunlight, for factory workers to live in a welfare state-like utopia in the 1880s: “to socialise and Christianise business relations and get back to that close family brotherhood that existed in the good old days of hand labour”.

What has changed is that, in the past, activist CEOs tended to be socially conservative, says Caro. Today, they are more likely to be backing progressive points of view.

“So I don’t think it is possible to escape the fact that CEOs have to take a lead. They always have – it’s just that they used to be a lot more conservative.”

Often that meant actively discriminating against others depending on their lifestyle, religion or denomination (anti-Catholic prejudice was rife in the Menzies era), race or gender.

“To see CEOs actively working not to discriminate against a whole lot of people is, in my view, ethically the way it should be.”

Leaders try to maintain the centre

Activist CEOs may seem to be coming from the left, but this is generally because they are usually responding to a backlash from the “right” side of politics, says Harvard Business School Professor of Business Administration, Michael Toffel.

If they are merely taking a conservative approach of sticking to their corporate values – which commonly emphasise equality, diversity and sustainability – that pits them against those who may not support movements such as same-sex marriage, quotas for gender equality, limits on free speech to protect against hate speech, or global warming.

“If we start to see some policies from the ‘sharp left’ starting to emerge, you may see some of these same CEOs say that’s not the right way to go either,” says Toffel. “They [the CEOs] are trying to maintain the centre, but it is being perceived as leftist because they are reacting to Right-side responses”.

Toffel warns that activist CEOs may look perfectly acceptable – if you happen to agree with what they are saying.

“For those who are cheering CEO activism because they happen to agree with the politics, I think they have to be careful about wondering about whether this is really something they would endorse if the shoe were on the other foot”.

What difference does it make?

Researching CEO activism with Toffel is Duke University Business professor, Aaron Chatterji, who says corporate social activism can both boost and batter business. Outdoors company Patagonia reported a revenue surge after announcing a lawsuit against the Trump administration’s efforts to slash the size of Bears Ears national park in Utah.

However, when airline Delta cut its discounts to members of the National Rifle Association after a school mass shooting in a Florida, it was punished by US State of Georgia, which stripped proposed tax breaks.

The US-based Webber Shandwick poll shows 70 percent of respondents approve of outspokenness about job training, but far fewer wanted their corporate leaders to tackle hot-button topics such as refugees (26 percent), gun control (26 percent) and LGBTQI rights (29 percent).

Australians are less reticent. Around 36 percent support CEO outspokenness, with 32 per cent saying “it depends …”. This is almost twice as many as those who think CEOs should stay shtum.

While a minority (13 percent) said activist CEOs had an influence on government, almost half of Americans say corporate leaders who avoid contentious issues will face criticism from the media, customers and employees and 21 percent said those companies may face declining sales or boycotts.

Even though Joyce’s stance attracted some return fire, it would be hard to see there was any damage to the Qantas brand. Qantas chairman Leigh Clifford said, after the vote, that the customer net promotion score had “never been higher”.

Says Caro: “Most people have more respect for those who stand up for what they believe in, than those who don’t. And think about who Qantas employs. A very sizeable percentage of their employees are gay men”.

Perhaps, like a dog whose bark is worse than its bite, a backlash can sometimes have little real-world impact. In its 2017 annual report, Coopers admitted that its beer-and-Bible storm was “a trying time, but had little impact on trading, with beer sales between April and June being stronger than in previous years.

Image take from CEO Activism infographic by Webers and Wick

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