Why Character Matters

A leader worth following has three key ingredients: Competency, Commitment, and Character. Today’s blog will focus on Character.

Competency determines what we can do.
Commitment determines what we want to do.
Character determines what we will do.

A few years ago I had the privilege of spending a week at one of Canada’s prominent business schools with public-good sector leaders from across the country to focus on leadership development.  I was pleasantly surprised that the school focused on the importance of character in particular because of the fallout from the financial crisis of 2008.  The ethical lapse leading up to 2008 wasn’t caused by business incompetence, but rather by poor judgement.  The school was questioning their role in the crisis.  Was part of the problem that leaders receive plenty of training on competencies but not enough about character, which actually drives behaviour?

Character matters. Character can be learned and needs to be practiced in order to be cultivated.  Character, defined simply, is the way someone thinks, feels and behaves.  Character is fundamental to how we engage with the world, who we engage with, how we act and make decisions, and what we notice and reinforce.

What are the behavioural habits that allow you to have the character of a leader worth following?   Philosophers have used the term virtues as a way of describing the behaviours, values and traits of good character.  A leading scholar in leadership character, Professor Mary Crossan, identifies 10 virtues of leaders who focus on long-term performance of their organization, and the organizational impact when these virtues are present.

1. Humility – continuously learning, respect, trust
2. Integrity – reduction in uncertainty, partnerships developed, cooperation
3. Collaboration – teamwork, diversity, learning, confidence
4. Justice – strong employee relations, fairness
5. Courage – innovation, confidence to act, opposition to bad decisions
6. Temperance – reduced risk, quality decisions
7. Accountability – ownership of decisions and their execution
8. Humanity – social responsibility, support
9. Transcendence – big picture thinking, striving for excellence
10. Judgement – quality decisions, calculated risk-taking, commitment

This may seem self-explanatory, but Crossan goes on to point out what happens when any of these virtues is missing in a leader.

• A leader without humility isn’t open-minded, doesn’t listen to others, becomes isolated and is unable to become a stronger leader.
• A leader without courage doesn’t challenge poor decisions or difficult issues.
• Leaders without accountability create a disengaged culture of fear where others are blamed for their poor decisions.
• Leaders without temperance lose credibility as they rush to judgement, don’t gather relevant data and take uncalculated risks.
• Without collaboration, leaders don’t achieve worthwhile goals because they don’t take advantage of their team’s diverse knowledge, experience, judgement and skills.

How are you practicing these virtues to strengthen your character?  Character is shaped by our habits, which we are often unaware of.  Frank Outlaw said, “Watch your thoughts, they become words; watch your words, they become actions; watch your actions, they become habits; watch your habits, they become character; watch your character, for it becomes your destiny.”

Leadership requires self-awareness of our behaviours and the courage to try new habits that will shape our character.   All of us have character, but it is the depth to which our character is cultivated that determines the type of leaders we are.  Our character comes to the forefront in particular during crisis.  Since leadership is a life-long learning journey, at times we will rise to the occasion in a time of crisis, and other times we will disappoint.  The important part is what we learn from each crisis and how we respond in the future.  This is what forges our leadership character.

Why does character matter?  Fred Kiel, author of Return on Character, points to a new study by KRW International. The researchers found that CEOs whose employees gave them high marks for character had an average return on assets of 9.35% over a two-year period. That’s nearly five times as much as what those with low character ratings had; their ROA averaged only 1.93%.

In the short term, people follow you because of what you do.  In the long term, people will follow you because of who you are.  Character matters.

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