Talking about Character in the context of business can often seem strange. People roll their eyes or look at me weirdly when I combine these two words; character & business. CEOs will tell you that we are here to run a business that achieves maximum return for all stakeholders. Right – true! And as obvious as this is, it is missing a lot.

‍

Running a business must include how we view, train, measure, and judge business leaders. We are not afraid to judge the character of CEOs when the "ship" goes down due to a lack of integrity or greed (the case of Boeing, Volkswagen, BP, Lehman Brothers, and many more). When I am asked to advise on growth and development programs for leaders, HR often turns to technical and leadership skills development (and let's throw some coaching as well).  This in turn, forces us to focus on specific challenges and situations when it is evident that is not the real problem. The root of the problem is who people are and their character. The thought of having a conversation this challenging is almost unbearable or feels out of the world.

‍

But if leaders' poor character can take the ship down, their good/healthy character should be able to take the boat further. So, we should ask ourselves: Does a leader's character contribute to organizational performance, bottom line, strong business results, business model, etc.? Can we define what good character means in the CEO context? And do leaders who need to work on their character know it?

If you know me, you know that I turn to research whenever I have these questions. I was surprised by how much work has been done in this area but how little we pay attention to it.

‍

Let's unpack some of it.

‍

According to the International Labor Organization, Discrimination and harassment at work have affected more than one in five people, and one in four people do not feel valued at work. Gallup's 2023 engagement report shows us that only 23% of people worldwide are fully engaged at work, 59% are quiet quitters and 18% are actively disengaged.[1]

‍

Research also tells us that forming and cultivating mature and healthy character directly improves organizational business performance and growth potential. [2] When employees rate their CEO's character highly, companies have an average of 5 times more return on assets than CEOs rated low on their character.[3]

‍

Ethically led organizations display stronger organizational culture, lower levels of staff turnover and increased employee efforts [4]. Research also states that character-based judgment supports a superior's performance, and its lack explains misconduct and poor decision-making. We also know that character has a powerful influence on individual well-being and sustained performance, so it matters from a leadership perspective and on all organizational levels[5].

‍

What can organizations do to help people to develop their character?

‍

Most organizations must consider developing character when planning leadership training and development programs. People can grow their technical skills and create a healthy character by shifting the learning focus and approach. This should be done by raising individual self-awareness, providing feedback and mentoring, and being conscious and intentional about recruiting people with mature and healthy character traits to the organization and leadership position.

‍

Now that we know our desired outcome, we can map our way there. The journey starts with the leaders, they are the ones leading the organization and the employees. Here are some crucial starting points:

‍

• Lead by example: People must see what good looks like from a performance perspective and who we are as human beings and colleagues at work. Your people will do what you do. Research shows us that employees are more likely to mirror their leader's behavior.
• Formal and informal training: Offer knowledge about the character traits that are expected from the leaders in your organization. This can be done through training, mentoring, coaching or formal leadership development, assessments etc.
• Environment: An Organization’s culture communicates the essential character traits you want to see in people. Work towards living them out and keeping each person in the organization accountable.
• Experiential training:  The easiest way to know if you are on the right track, is to honestly ask this one question, “Does your intention match your impact?” It is a brilliant way of constantly reviewing our behavior, to understand if we lead in the way we intend. This question opens the door to upward or peer feedback, to continue building trust and lead by example. That is the next step on our journey.
• Feedback on development experience: There’s nothing like good, honest feedback from people you're leading. You can trust them to know if your organization is making good transitions. This feedback can help you tailor mentorship and coaching activities to your team’s needs. Not only will you transfer technical skills and knowledge, but you will also develop better people.