In the wake of the Financial Services Royal Commission, trust is currency.
In the final report of the Financial Services Royal Commission, Commissioner Hayne noted; "Leadership always matters, and banks must embed conduct and culture messages and expectations from the top down, through middle management down to the teller in their organisation."1
The report is clearly a wakeup call for the financial services sector, and more broadly, corporate Australia. The misconduct uncovered, driven largely by greed, dishonesty and poor culture, has fundamentally eroded trust in blue chip organisations. The damage will take years to repair.
The Commission acknowledged that culture, governance and remuneration march together and leaders could do worse than to use this framework for restoring trust.
Strong, authentic leadership builds trust
Trust is not a difficult concept to grasp for it is inherently practical – it is a simple function of credibility (I know what I’m saying), reliability (I do what I say) and intimacy (I can encourage others to engage with me) but it’s easily offset by self-interest. High self-interest, as evidenced by the Royal Commission, undermines trust.
Self-assured, authentic leaders who can connect and mobilise their people and wider stakeholders around a compelling vision - absent of self-interest - will rebuild trust and return confidence in our financial services sector.
The future of leadership – three key shifts
Being a leader during the fourth industrial revolution and dealing with the exponential changes to the way we live, work and relate to one another is for many, challenging. Old models of leadership are failing and the focus on numbers, analytical fact finding and managing through hierarchies and silos can’t be relied upon as a foundation for success.
Leadership, not technology, remains the principle source of value creation. As we look to the future, the style of leadership – and the culture - that got us here will not get us to where we need to be.
Today’s successful leaders have navigated three profound shifts in the way they lead and build trust:
- From success to significance - they identify a higher purpose and bind people to it through meaningful action. They excel at monetising purpose.
- From hierarchies to networks - they engage with curiosity and build diverse relationships which spark collaboration and ignite innovation.
- From coping to thriving - they know who they are - warts and all - what they believe in, and what motivates and enables them to do their best for the people around them.
In the wake of the Royal Commission, and other combustible global issues, there is a palpable sense of disillusionment around leadership. Stocks are low. Yet there is recognition that deep work needs to be done to transform cultures and for some, this has already started. Strong and authentic leadership, built on a foundation of trust, will lead us to a better future. As Commissioner Hayne said; Leadership always matters.
Great leaders are born, but they can also be made. Learn about our approach to leadership development.
|Nick Avery, Senior Client Partner, Korn Ferry||Juliet Warne, Senior Principal, Korn Ferry|
|Stephen Johnston, Senior Client Partner, Korn Ferry|
1. Final Report, Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, Vol. 1, p 391.