We see countless examples every day of CEOs who enforce one set of rules for their company, while operating under a completely different set of rules for themselves. This hypocrisy is more obvious to your people than you might think, and can have devastating repercussions for company performance.
In my corporate career, I was astounded that hypocrisy could be so entrenched in the hallowed halls of the boardroom: a CEO whom I once worked for demanded that every leader in the company undertake 360-degree feedback, while completely unwilling to submit himself to the process; another pursued a very public campaign for gender diversity, while at the same time allowing an abusive and misogynistic culture to thrive in one of his company’s business units; yet another CEO espoused a culture of healthy debate and challenge, but anyone who dared to disagree with her was immediately ostracized and labelled as disloyal.
The fairy tale, “The Emperor’s New Clothes,” is alive and well, almost two centuries after it was first published. How can any CEO really believe that they won’t be caught out? Do some think that they’re above the law? Do they think they’re somehow entitled to choose their own behavior, while benevolently dictating a different standard for their people? Or are they completely oblivious to their own hypocrisy, believing their own BS?
The simplest answer is often the most likely. Maybe the behavior is as predictable as the horse named Self Interest being first past the post!
The Impact on Company Performance
The repercussions from hypocrisy at the top of a company are predictable. Employees become cynical, killing any chance you may have had of eliciting their discretionary effort. When no one’s prepared to go above and beyond, you’re doomed to settle for a culture of mediocrity and underperformance.
But even worse, at least a small portion of your workforce will interpret the hypocritical behaviors of the CEO as permission for them to behave the same way—to contravene policies and standards, to act unethically or to ignore management directives. This controlled anarchy is insidious, as it’s often difficult to see from above. Once this culture gains a foothold, it can be very hard—if not impossible—to repair.
Fortunately, the converse is also true. A CEO who exemplifies the ethical standards he sets for the company can have incredible influence over his people. Superior performance is not guaranteed from that position, but it’s much more likely to come with strong—and visibly consistent—leadership. When the same rules apply from top to bottom, people are more prepared to do what their CEO asks of them.
What Can You Do?
Knowing how you’re perceived is difficult for a leader at any level, and it doesn’t get any easier just because you happen to be sitting in the corner office. The biggest difference between what we think we’re doing, and what people see us doing is intent.
We know our intentions, and give ourselves the benefit of the doubt when gaps emerges between our intent and our actions. But our people see us through a different lens, which is often tarnished by past leaders who’ve confirmed their darkest suspicions.
There are two simple questions we can ask ourselves to increase our awareness of the gaps between our espoused values and our actions, eliminating any potential hypocrisy:
1) What if this was on the front page of the Wall Street Journal?
I’m convinced that this question can stop most CEOs from engaging in unethical or hypocritical behavior—as long as they don’t let their optimism bias (it won’t happen to me) trump the answer.
Most of us would feel quite differently about doing something if we knew it would be reported in detail for the world to see. The little voice in the back of our head that says “no one will ever find out” is silenced, and we’re given pause to rethink our actions before it’s too late.
2) How would I react if one of my middle managers did this?
This is another great reality check. If you’d react differently to someone else in the company doing something that you’re about to do yourself, the contrast of those positions will be stark. This question provides a basis for re-examining any inconsistency between the standard you set for your people and the standard you set for yourself, without rationalizing it away.
As CEO, you need to eat your own dog food. Any double standards will dilute the potential performance of your people, and you’ll struggle to achieve the things you’d like to achieve. Consistency of words, rules and actions is the price of admission, and without that you’ll disable the one resource you most rely upon—your people.
As a leader, it doesn’t matter what you know. It doesn’t matter what you believe. It doesn’t even really seem to matter these days what you say.
As a leader, it matters what you do.