Seven months since lockdown, what have we learnt about responsible business, leadership and trust?
A CIPD study provides insight into how senior leaders approached the challenges of the first wave of COVID-19 – and highlights that trust remains a key driver
Friday 23 October marked seven months since the UK officially went into lockdown. That’s seven long months of social distancing, antibacterial gel, mass working from home and debates over the efficacy of face masks.
For business leaders these have been seven of the most testing months of their working lives – even more so than the 2008 financial crisis. Not just due to the significant operational and leadership challenges of keeping organisations afloat during a pandemic, that caused some sectors to be busier than ever before and others to shut down entirely, but because for seven months business behaviour has been scrutinised so closely. For many organisations, the worst is yet to come.
There has been no shortage of headlines pillorying businesses and leaders for behaviour and decision-making during COVID-19: Britannia Hotels came under fire for sacking staff and leaving them homeless after closing a property in Scotland; JD Wetherspoon for initially refusing to pay staff and suppliers; Arcadia for planning to base staff notice pay for redundancies on 80% furlough pay rather than their normal salaries. We could go on.
Throughout the pandemic, there has been a high expectation from the public that organisations should do the right thing and low tolerance for not treating people fairly. Multiple stakeholders, not least including workforces themselves, have been holding companies to account. Responsible business (ie operating ethically and sustainably, in line with compliance and with consideration for multiple stakeholders) is by no means a new concept. Still, it has taken on fresh resonance during this COVID-19 crisis. So too has trustworthy leadership – the heightened sense of personal vulnerability we have all felt during the pandemic means we are seeking leadership. In a business context, we need to trust that the top team will lead us safely through the unknown.
To discover how the UK’s executives coped through the first wave of COVID-19 and how they continued to centre responsibility (or not) at the heart of their actions, Veronica Hope Hailey and the CIPD partnered on a research project. We heard from more than 50 business and HR leaders, through interviews and focus groups, allowing us to build a picture of what it was really like to lead a business through the peak of the pandemic, navigating the complex and challenging choices that needed to be made. The results have now been published in our report Responsible business through crisis: senior leaders on trust and resilience during COVID-19.
The senior leaders spoke of the shock of the situation (there’s a reason why the adjective ‘unprecedented’ was used so much that it lost all meaning), forcing them to make decisions at pace without the data or insight they normally rely on. As one C-level director put it: ‘You’re looking for stability and certainty, and things that you can cling onto as being true. That is a really difficult dynamic to navigate when you need to give people security… They’re looking for you, as a leader, to tell them what to do, when nobody knows what to do.’
‘I’m very, very tired,’ said another director, reflecting on the weight of accountability from leading through crisis. Leaders spoke of juggling challenges like keeping frontline workers safe, maintaining connections across the new army of home workers, balancing the needs of a complex ecosystem (employees, suppliers, customers, shareholders and so on) and ensuring financial sustainability.
So how did leaders deal with these challenges and the personal pressure?
Some of the solutions were connected to the culture of the organisation going into the crisis. A pre-existing commitment to be a responsible business, embedded deep into culture and understood and valued by the whole organisation, helped. The pandemic shone a light on the culture that already existed, rather than changing it. If the leaders and organisations were already trusted, employees, customers, suppliers and shareholders were more likely to take the risks that were asked of them.
With so many of us working from home, levels of empowerment increased, as did decentralised decision-making: senior teams had to trust their workforces and local managers to make decisions. They didn’t have the luxury of time to do otherwise. Communication went into overdrive, bottom-up as well as top-down, with an emphasis on transparency and sharing.
What comes through loud and clear is the humanity of leadership: we found compassionate leaders who were unafraid to authentically show their vulnerability, while still creating a common sense of purpose and a path through uncertainty. Mass home working alongside school closures forced them to put any ‘corporate professionalism’ to one side and show their personal sides. We have had to accept people as they are through this crisis, personal lives melding into work ones – children, pets and all.
CIPD data on the impact of COVID-19 on working lives to date shows that some of these approaches have paid off, with employees largely reporting that line management support and fairness have held up to pre-pandemic levels. The research finds the majority (69%) of employees are satisfied with how their employers are responding to the pandemic, with 67% saying that their employers have been supportive and 70% that their line manager has checked on their health and wellbeing.
The role of the people profession in shaping some of those positive outcomes shouldn’t be underestimated. HR has been under immense pressure during the pandemic, balancing the priorities of protecting the workforce and protecting the organisation. Many HR leaders were the ones leading the organisational response and there’s no doubt the value the profession has brought during turbulent times, while putting itself at risk of burnout. This is recognised by senior leaders outside the function. As one CEO told us: ‘Throughout this crisis, HR has been completely front and centre. Cometh the hour, cometh the HR team.’
It is worth noting here that the courage and local leadership that has been shown by some front line staff – not only in the NHS, but in pharmacies, charities, banks, food retailers – will need further recognition, and may mean a review of reward, recognition and development schemes going forwards.
We now have the opportunity to reshape the world of work, putting our people at the heart of recovery and embedding the principles of responsible business. The people profession has led admirably through the first peak of the pandemic. It now has the chance to lead on creating more inclusive, ethical, compassionate and resilient organisations.
View the 2020 report by Veronica Hope Hailey and the CIPD. The CIPD's work in this area is ongoing: view the 2021 report Responsible business through crisis: senior leaders on building new cultures of trust.
Professor Veronica Hope Hailey
Veronica Hope Hailey is Emeritus Professor at the University of Bath and was named among the “UK’s Top 10 Most Influential HR Thinkers” in 2012, 2013, 2014, 2015, 2016 and 2017. She is author of the CIPD reports Where has all the trust gone?, Cultivating trustworthy leaders and Experiencing trustworthy leadership.
Peter is the CIPD’s chief executive. He writes and speaks widely on the development of HR, the future of work, and the key issues of leadership, culture and organisation, people and skills.