NEW YORK -- When it comes to laying off employees and restructuring the corporation, let CEOs share in the pain, says the president and chief operating officer of TIAA-CREF, the nation's largest pension system.
"If sacrifice is necessary, perhaps they [CEOs] should show the way and sacrifice the most. It seems as if CEOs are being enriched as the rank and file are being laid off," said Thomas W. Jones '69, MRP '71, and member of Cornell's Board of Trustees. The comments by Jones came at a roundtable discussion on "New Values for Corporate Leadership," sponsored by the Johnson Graduate School of Management and held Oct. 16 in New York City.
The roundtable provided insight into what values CEOs need to have to lead corporate America into the next century.
A new Johnson School survey of Fortune 1,000 executives cited "compassion" as one of the most important characteristics business leaders will need to chart successes in the future.
But the public, according to the panelists, does not equate compassion with corporate executives. This perception, according to retired Union Carbide CEO and Cornell trustee Robert D. Kennedy, BME '55, is bolstered when corporate executives earn nicknames like "chainsaw" and have their photos displayed on news magazine covers under the headline "Corporate Killers."
While not condoning the behavior of some CEOs, Kennedy noted that many corporate chieftains are under more pressure today to turn a profit than ever before. "There is a sharp increase in shareholder activism; it's a shareholder revolution."
Dayton Ogden, president of Spencer Stuart, one of the nation's most respected executive search firms, said corporate boards have become more powerful and are taking their roles more seriously, by examining closely a CEO's job performance. The press has even begun calling for the ouster of CEOs. An editorial in the Oct. 7 Business Week urged AT&T's board to replace CEO Bob Allen immediately with strong outside management.
Given the problems CEOs and corporate America face, what are the values that the new breed of corporate leaders -- up and coming MBA students -- need?
Panelist Philip Merril '55, chairman of the board of Capital-Gazette Communications, which publishes Washingtonian Magazine and five Maryland newspapers, contends that the values central to being a CEO -- doing what is right -- have not changed.
"The essential value of what is right is immutable," he said. But what has changed, he continued, is America's definition of morality, or what is right. "Just because something is legal, doesn't make it right."
"Do we want managers who press the moral edges and get away with whatever they can?" Merrill asked. "It is important to find managers and others who have an inner sense of decency."
James Belasco '57, Ph.D. '67, an educator and author of Teaching the Elephant to Dance: Empowering Change in Your Organization and Flight of the Buffalo: Soaring to Excellence, Learning to Let Employees Lead, said tomorrow's executives must be quick learners and motivators who can demonstrate concern for fellow employees.
"We need to learn how to lead at the speed of the Internet," he said. "We don't have two years to develop a new product anymore. Leadership that won't speed up to the pace of the Internet will not survive."
In addition, Belasco said, good leaders must have an outside perspective and must understand the needs of the corporation's many bosses at various levels, such as stockholders, consumers, employees and the community. "Leadership that invests in employees so they can learn and grow is making a wise investment in the corporation's future," he said.
Pamela Mayer, vice president of the Center for Creative Leadership, said corporate leaders of the 21st century will need aesthetic competencies. "Future vision will come from the ability to create," she said.
Mayer also noted that with America's disillusionment in church and school, corporations will be increasingly called on to provide meaning for the larger society. She said corporations and their leaders must be aware of employees' spiritual needs and their desire to be part of a community. "To survive in the 21st century, one must be attentive to the needs of the workforce."
The roundtable discussion, which also featured comments from Eli Manchester Jr., BME '57, president and CEO of Kewaunee Science Corp. and a Cornell emeritus trustee, and Thomas R. Dyckman, acting dean of the Johnson School, also provided an opportunity for officials to promote the Park Leadership Fellowship Program, which, beginning next fall, will award full-tuition, two-year scholarships to 30 entering MBA students.