Leading via serving: American values in action
“We really want to make a difference in the world for our clients, for our partners and for the communities we live in.” John Montgomery, Bridgeway Capital Management
Would you work for a company that is dedicated to ending genocide and gives half of its profits to charity?
What if the CEO promised to limit the compensation ratio between the highest and median paid employee? Or that managers are expected to serve their employees, not the other way around? Would you expect that company to survive in our cutthroat capitalist world?
Bridgeway Capital Management has operated this way for 23 years, and it manages $8.4 billion in assets and is growing stronger.
“Where in your life has been being nasty and dog-eat-dog really worked out for you? In what relationship has that worked? ... It’s not sustainable,” founder John Montgomery said. “We’re not here just to be good guys for our clients. We really want to make a difference in the world for our clients, for our partners and for the communities we live in.”
Bridgeway’s charitable giving is not optional. It’s written into the articles of incorporation. The firm has given tens of millions of dollars to more than 500 nonprofits, including to many promoting peace in war-torn corners of the planet.
The focus on conflict resolution fulfills Bridgeway’s mission statement: “A world without genocide. Partners effecting extraordinary community and world change.”
Montgomery acknowledged that not every financial analyst or fund manager will want to work for him, but he’s only had one quit in 23 years. The chance to participate in Bridgeway’s philanthropy is a
big draw, he said.
“If what you’ re about is making a seriousdifference in life, then you should study the heck out of what we’ re doing ,” he said.
In discussing his management style, Montgomery brought servant leadership, a philosophy where managers focus on givingemployees tools and the freedom to succeed and innovate. He said it’ s critical to building an enduring and successful corporate culture.
Seems like everywhere I turn these days, I hear some successful executive espousing servantfirst I assumed it was a New Age oxymoron for eccentric millionaires, but when I du ga little, I discovered it’ s a legitimate methodology developed by a management coach at AT&T without any religious sub text. And practitioners swear by it.
Robert Greenleaf coined the phrase servant-leader in a 1970 essay describing a management style that he observed in successful offices. He wanted a name for managers who thought of themselves as support staff, building their employees’ trust and encouraging their success, which leads to employees taking pride in their work and improving their performance.
That sounds easy, but true servant leadership is not. My friend Larry Payne, a fixture of Houston politics and philanthropy for 40 years, taught servantleadership principles when he coached corporate executives. He edited a collection of essays on servantleadership by local leaders called “The Heart of HoUSton .”
“It’s the old-fashioned idea of two business men building a billion-dollar company on the strength of a hand shake. There’ s no need for a contract because there is trust and mutual respect, and they feel committed and accountable to each other ,” he explained.
Servant leaders think of themselves as part of a community, and they believe their success is tied to the community’ s prosperity. They listen more than they speak and ta mp down their egos. They hold their staff accountable in their jobs, but the staff may also hold their boss accountable.
“Servant leadership is the idea that we are put on this Earth for one thing, and one thing only, to serve other human beings. To do that, we have to be ready, healthy and available to serve our fellow humanPayne said .“You can be a strong business leader andbeaservantleader.It doesn’ t have to come across asa soft, mu shy thing .”
Most devotees apply these principles to their personal and public lives. Servant leadership is the antidote to the “greed is good” philosophy that too many people mistake for capitalism. Instead, it emphasizes the social contract: I will pay you a fair price for ago odor service as long as it contributes to making our community stronger.
Too often, American capitalists emphasize greed, a fact self-evident in the growing disparity between rich and poor and the shrinking middle class. Income inequality, though, is ultimately bad for society and business. When fewer people move up the ladder, they purchase less, and economic growth slows.
When the poor feel the system is rigged against them, and they possess very little, they also start revolutions,either at the ballot box or in the streets. Servant leaders understand that success is defined by the risingtide floating all boats.
That’ s why Montgomeryfounded Bridge way to give away so much, and it’ s why he goes to places like Rwanda to promote peace and reconciliation.
“It’ s pretty easy to be skeptical ,” Montgomery said .“But it’ s still pretty amazing tome that we get to do what we do and how much we’ ve accomplished .”
And what about that awkward mission statement?
“I would love for the word genocide to be stricken ,” he said .“When genocide doesn’ t exist anymore, and we have reason to believe it won’ t come again, we’ re stripping that suck er out of there.”
Note: I am going on next column will appear June 19.