Setting a new standard

Real insights come through understanding multiple perspectives – these are the skills you need at every stage of leadership." Associate Professor Michele Roberts, AGSM Academic Director

Changes to expected reporting standards and incoming laws are also making responsible operation increasingly critical. “It’s no longer a matter of ‘nice to have’,” says Wailes. “It’s a requirement, especially for large organisations, to have systems and processes in place. For example, they are going to have to look at their supply chain and report on it to show that modern slavery is not involved – and if they get it wrong, the penalties will be significant.” This will be a big compliance issue for organisations. “It requires businesses to think differently about how they enter into supply arrangements and to focus on issues around traceability in the supply chain,” says Wailes. “Organisations need to invest in understanding technical compliance – but they also need a broader leadership approach to be able to navigate it all positively.” Organisations that have moved early and transparently are already reaping the benefits. “A few years ago, Unilever signed up to the UN Sustainable Development Goals [SDGs] and began reporting across all its businesses to manage its impact around them,” notes Wailes. “That was a massive call for an organisation with such a diversified, complex supply chain across a lot of different products. But it’s played a really important role in establishing their reputation as an ethical organisation and they have led all their suppliers on that journey, too.” This has had a big impact in developing countries where Unilever sources products. “It also means when Unilever goes looking for talent, they’re able to attract more than their fair share.” AGSM incorporates the SDGs throughout its full-time MBA program and by 2022 will incorporate them in all programs. “The SDGs are a fantastic framework because they are so clear,” says Roberts. “They show the key targets to focus on and the metrics. If leaders are not able to articulate the way the organisation supports the sustainable development goals, they’ll be left behind.” Roberts points to ExxonMobil, where a third activist investor recently won a seat on its board – a strong example of a company that will have to listen up to survive fundamental change. “This is one of the biggest energy companies in the world and it now has multiple activist investors on its board, demanding a shift to clean energy,” says Roberts. “You’d hope that the leadership team on that board understands how to view other people’s perspectives and can find some common ground.” Wailes says this new and evolving landscape is not only incredibly energising for business leaders but also proves the relevancy of an MBA. “We’re no longer in a world where everything is just a version of something that happened in the past. We’re in a world where things are novel and changing, and that’s going to require creativity and solid frameworks for coming up with decisive ways forward.”