by Tim Mead, Managing Director

Authenticity, in an age of increasing transparency, is itself becoming an increasingly important attribute of corporate leadership. It means undisputed credibility by one definition, it signifies being true to one’s own personality, spirit or character by another.

Put another way: What every good leader knows and every aspiring one should know is—people (colleagues, allies, investors, customers, etc.) aren’t stupid. If you are not straight with them—in person, action and deed—they will exit, maybe not right away but eventually.

Authenticity isn’t something a person or an organization is born with—a trait never lost in one’s DNA. Rather, it is a quality that is built and must be maintained.

How? Before answering the question, let me share three recent encounters with “authentic” individuals in the corporate sphere.

One is a new CEO of a half-billion dollar (revenue) external services provider, having just arrived from a senior post at an IT giant. Rather than make the mistake so many new CEOs do—hunker down with familiar faces from the likes of McKinsey, Booz&co., BCG or Bain to figure out what he or she has gotten themselves into—the new leader is hitting the road: Literally. He’s spending months—that’s right months, not days or weeks—“walking around” the company, paying meaningful visits to offices across all of the globe’s continents. “I’ll figure out the company’s strategy once I figure out who I’ve got to execute it,” he told me in so many words. “And they can figure out whether they want to follow me.”

Another is the founder of a first-time private equity fund in a sector that’s absolutely been hammered in the past three years. In convening investors in two pre-fund (proof of concept) deals, the founder chose to have his portfolio CEOs air the unexpected challenges each faced in their different operations rather than gloss over their financial results as first-year jitters certain to dissipate in time. When I pointed out the risk the founder took in exposing investors and prospects to the struggling managers, he simply said: “It’s who I am. It’s what the firm stands for.”

Still another is the CEO of a “turn-around” situation, a niche marketing services company trying to scale beyond its modest size on behalf of its VC investors. He initially struggled between two self-identities, each based on his past experiences: One as an emotional, all-in leader (as if he’d started the company himself); the other as a professional manager, hired by the VCs to make tough decisions to salvage their investment in the company. Once he came to grips with the choice he had to make—the hired gun—his authenticity (though not necessarily popularity) shone through.

What those examples illustrate to some degree is the how of authenticity in a corporate environment. Leaders who aspire to be “real” should:

• Walk around: Get to know various constituencies, particularly employees, by spending face to face time with them—whether in 360-degree “town meetings” or in less formal settings.
• Speak from the mind and, sometimes, the heart: Put away PowerPoints, scripts and other prompting devices when speaking to the rank-and-file as well as others in your ecosystem. Look them in the eye and gauge their response to what you are saying.
• Share information, even if it is ambiguous or less than flattering, at an almost realtime pace. For those in public companies, make sure managers—geographic, functional, divisional—are armed with the relevant information that goes into earnings conference calls with analysts so they can discuss specific performance challenges and opportunities with their teams and their charges a day or so after the calls.
• Do not mask uncertainty. If your business model begins to show flaws, acknowledge them in a constructive way. If your pipeline is less than robust or “lumpy” (today’s favorite adjective for describing a future about which a CEO is clueless), say as much.

The prescription for authenticity is far easier to write at an individual level than an organizational one. Just look at the resistance Morgan Stanley’s CEO and Barclays’ CEO are likely to encounter as they attempt to reshape their financial services companies into “authentic” stewards of assets given them by clients and responsibilities granted them by governments, not just the annual-bonus-hungry carnivores so many in the industry are portrayed to be. It’s a far more complex topic than space allows me to address today, but one I’ll get to in coming posts as Gustin Partners’ transformational support experience and talent management engagements sharpen the firm’s thinking on “authentic” corporate cultures.

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Tim Mead is a managing director of Gustin Partners. He is responsible for major client relationships and engagements across the spectrum of the firm's services, with a concentration on client companies in the professional services, media, communications services and advanced information technologies sectors.