The Week in Ethics: GM’s New CEO

Update: March 27, 2014, GM CEO Mary Barra will testify before Congress next week, answering questions about consumer safety and the process (a decade before she became CEO) of how GM handled faulty ignitions without recalling cars impacted (which resulted in at least 12 deaths). NYT piece speculating about what in GM culture might have contributed to its ethical failures in behavior here.

This column originally appeared in Business Ethics Magazine, January 30, 2014 entitled “GM’s New CEO: Demonstrating How Less Can Be More.” This week (February 10, 2014) GM Chairman Theodore Solso  announced new CEO Mary Barra’s “total compensation is in line with her peer group and properly weighted so that most is at-risk.” Her salary had originally been reported as lower than her predecessor’s, giving rise to criticism about gender bias.

I’m reminded of a line in the lyrics of a song from the movie My Fair Lady which asks, “Why can’t a woman be more like a man?” Seeing the film at an impressionable age, the refrain lived in my head for years. Was the message that women needed to be more?

The very small number of women who’ve made it into the CEO pipeline has given rise to ongoing articles analyzing why so few, and research by Catalyst and others making the case for diversity. Currently, less than 5 percent of Fortune 500 companies and less than 10 percent of the Fortune 1000 are led by women.

In January 2014, Mary Barra, an engineer and General Motors (GM) veteran became its first woman CEO. In spite of a number of talented women in leadership positions at GM, a woman leading GM or any global automotive company is a well-heralded first. Also in January, with far less media acclaim, another woman engineer from another field considered traditionally-male become CEO of a Fortune 500 company. Jacqueline Hinman was promoted after a long career at CH2M Hill, a global engineering firm.

The start of the new year brings the total of women heading Fortune 500 companies to 23 or 4.6 percent. In cross referencing their backgrounds, 16 were promoted internally after being tested in many roles. Of the seven brought in from the outside, four have been CEOs five to ten years so far, and the remaining three (HP’s  Meg Whitman (2011), Avon’s  Sherilyn McCoy (2012) and Yahoo’s  Melissa Mayer (2013) held long-term senior positions at their previous companies. Whether an insider or outsider is a good CEO fit depends on factors like personal attributes, strategy, execution, support, culture, and how they engage others to work for the company’s success.

Given the tiny pool of women CEOs, there is the understandable lament of the loss to organizations of not having more senior women. And beyond diversity of gender and ethnicity, the critical need to have more diversity of thought, approach to problems, and ways of leading that bring out the best from stakeholders. Because there are so few women CEOs, there is also a danger that in celebrating them we can go too far — celebrity status conferred on, cultivated or accepted creates a rock star status which when associated with leadership has real risks.

Barra has had a low key reaction to the considerable attention about her heading the 7th ranked Fortune 500 company. When asked about being an inspiration to women, she replied  she hoped her credentials as an engineer make her a role model to inspire young men and women to go into science.

She has deflected focus from herself to GM’s products and team, which suggests she will successfully resist rock star celebrity, something that characterized much of Carly Fiorina’s tenure at Hewlett Packard (HP) 15 years ago when she became the first woman to lead a Fortune 20 company. (There were only eight other women CEOs on the Fortune 500 list when she was ousted in 2005 when her approach didn’t yield expected results.) Yahoo’s Mayer in her first year continues to attract significant visibility as a CEO, mom and geek fashionista, with a personal brand “hotter” than her company’s.

Celebrity and leadership generally aren’t a sustainable combination because when the focus is allowed to stay on the leader and not redirected back to the organization, it becomes a story of “I” and not “we” which leaves the company and employees behind. While there may be short-term publicity value if a CEO becomes a darling,  as JP Morgan’s Chairman and CEO Jamie Dimon did after the financial crisis, attention allowed to stay too long on the leader backfires, especially when a company makes mistakes.

It has only been four years since GM emerged from reorganization and bankruptcy after a federal government bailout. Expectations for Barra’s leadership are enormous against the backdrop of a turnaround occurring in an unpredictable, constantly changing global environment. However, by not letting it be about her, the entire company is called to meet the challenge.

In interviews about her leadership attributes, colleagues have volunteered Barra has a passion for GM and its products, focuses on team building, seeks consensus, is fact-based and decisive, “an outstanding listener,” challenges thinking about assumptions and is very methodical, logical and fair. Others have pointed to her openness and inclusiveness, active seeking of others’ opinions, lack of big ego and “the self-described ‘nerd’ qualities that guide her gut.”

Many of these qualities are also reflected in general in women’s leadership styles. “What Women Bring to the Exercise of Leadership”  cites a 2008 Pew Research Center study where 2,250 adults (almost equally split between men and women) “ranked women better than or equal to men in seven of eight primary leadership traits.”

And yet, how hard it continues to be in many organizations for women to be given opportunities that allow them to be considered for the top jobs. Time and experience teach us that no gender, male or female, should be THE standard in leadership. To the degree that has been ignored in an organization, women have had to work much harder to do and be “more.”

“More” is an archaic standard that only fuels more and higher expectations that can cause good people to bow out because leadership seem too great a sacrifice. Or can self-justify why the story is about “I” not “we.” The more the expectations, compensation and hype are ratcheted up and accepted, the greater the chance of failure for all concerned.

Photo: © General Motors

The Week in Ethics

Gael O’Brien, February 13, 2014

Gael O’Brien is The Ethics Coach columnist for Entrepreneur Magazine. She is also a columnist for Business Ethics Magazine where this column was originally published.

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