Andrew Karolyi, Charles Field Knight Dean of the SC Johnson College, offers concluding remarks at the Faculty Panel.

Faculty panel addresses values-based leadership in business

Businesses and society can benefit when leaders keep both personal and companywide values in sight, according to a panel of Cornell faculty, administrators and alumni.

Freedom of Expression

The seventh annual SC Johnson College of Business Faculty Panel was held March 8 in Warren Hall in conjunction with Cornell’s “Freedom of Expression” theme year. Ravi Kanbur, the T.H. Lee Professor of World Affairs at the Charles H. Dyson School of Applied Economics and Management, launched the event in 2018 to showcase the college’s thought leadership regarding current social and policy issues.

Cornell’s statement of core values offered a starting point for this year’s conversation, which began with opening remarks from President Martha E. Pollack and closed with a remarks from Andrew Karolyi, the Charles Field Knight Dean of the SC Johnson College.

Dyson graduate Amy Low Chasen ’91, vice president, director of research at Baron Capital, said that when deciding whether to buy stock, her team looks for competitive advantage, above-average and sustainable growth, and the strength of the company’s leaders. They have found that CEOs and managers with clear values tend to care about their employees, focus on the long term and are better stewards of investors’ capital.

“When we meet with management teams, we ask questions about their business,” Low Chasen said. “But we also want to understand what motivates them as leaders, what their values are.”

Beta Mannix, the Ann Whitney Olin Professor of Management at the Samuel Curtis Johnson Graduate School of Management, said alignment between one’s personal values and an employer’s values is important because many people spend so much of their lives at work. But she finds that many of her executive MBA students have a difficult time articulating their values – not because they don’t have values, but because they have never intentionally reflected on them.

In one study, Mannix collected data from 1,000 women working in a global health organization to understand whether identifying core values had an effect on variables such as confidence, personal agency or influence in the company.

“What we’re finding is that once you understand your values, you are able to step beyond your comfort zone to take courageous action that you might not otherwise be willing to take,” she said. “In that way, self-awareness is a valuable asset.”

Organizations that are perceived as moral can better survive challenges like ethics scandals or economic downturns because the public is less likely to assign them blame and more likely to feel empathy for them, said Simone Tang, assistant professor of management and organizations at the Cornell Peter and Stephanie Nolan School of Hotel Administration.

Tang’s research has shown that leaders can improve the public’s perception of their organization’s morality by humanizing it. For example, promoting the CEO as the face of the organization, rather than just using a logo or a spokesperson; encouraging emotional expression in its employees; and showing the organization’s personality can all humanize the organization and highlight its morality.

Jinhua Zhao, the David J. Nolan Dean of the Dyson School, discussed the importance of recognizing two “bottom lines” when thinking about environmental stewardship, social responsibility and corporate governance – known collectively as ESG – and value-based leadership. Zhao’s current research addresses whether third-party ESG ratings cause any changes in companies’ chemical emissions.

“When assessing value-based leadership, we need to evaluate its impacts not only on the long-term profitability of businesses but also on the well-being of the society,” he said, adding that consumers, suppliers and other stakeholders are increasingly pushing firms to pay more attention to social welfare.

Alison Fromme is a writer for the Cornell SC Johnson College of Business.

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