Why is authentic leadership important in business?

authentic leadership

Need to know

Employees are increasingly demanding that their leaders act with authenticity and integrity as they re-evaluate their priorities post-pandemic.
Authenticity demands a number of skills, from empathy to strategy, many of which can be coached and nurtured by businesses.
Listening to employees and fostering the right culture are integral to survive in the next evolution of the world of work.

The topic of authentic and positive leadership has garnered much attention in recent months, particularly amid the findings of the Sue Gray report into the parties that took place in and around Downing Street during the Covid-19 (Coronavirus) lockdowns, and the subsequent denials by key players.

This is not just a matter for those in the public eye, but an issue that all organisations should be thinking about, and one that has become even more important in a post-pandemic landscape where many employees are re-evaluating just what they want out of life, and which businesses they wish to associate with.

Defining authenticity

One of the challenges here can be to define just what is meant by, and comes under, the label of authentic leadership.

Dr John Blakey, author of The Trusted Executive and founder of The Trusted Executive Foundation, which helps CEOs create a new standard of leadership defined by trustworthiness, says: “It can be defined as a style of leadership where leaders bring their whole selves to the workplace and participate fully and honestly in their roles.

“It can also be considered as a leadership and business approach that takes a more holistic view of what a business’ purpose is, beyond simply making a profit. An organisation with a compelling purpose, beyond simply lining the pockets of its shareholders and led by people who are authentic, real and highly trusted is going to attract, retain and develop the best talent, which as we know is a fundamental challenge to today’s organisations.”

This does not just mean leaders acting on the basis on how they feel, says Dr Ryne Sherman, chief science officer at Hogan Assessments.

“Often, how we truly feel can be pretty unpleasant for others and ruinous for business relationships," he explains. "A much more effective definition of authenticity means to act with integrity, to stay true to your word and to avoid double-dealing.

"While there is certainly overlap between being honest with others and acting in a way that is consistent with how you truly feel, they are not quite the same thing, and the distinction is critical.”

Achieving balance

Authentic leadership is about achieving the right balance of what have traditionally been viewed as 'soft' and 'hard' leadership skills, says Dr Andy Brown, chief executive officer (CEO) of leadership consultancy Engage. “On one side, leaders need to be able to think strategically, execute for results, build engaged talent and be agile enough to continually evolve and grow,” he says.

“On the other, they need to exhibit traits that have not traditionally been associated with business leaders: humanity, humility, openness and nurturing. Underpinning all of this is the need for self-awareness: the basis for authentic leadership.”

It is possible for businesses to coach authentic leadership, even if some people have more of a natural aptitude than others, says Brown.

“Being empathic, humble and nurturing is usually part of our psychological make-up,” he explains. “But skills like honest communication can be coached. This is not just about telling people a decision has been made, but about explaining the rationale behind, and likely consequence of, that decision. This is a skill that can be developed and honed over time.”

Creating the right culture

Organisations have a role to play in setting the tone for their overall culture, which will ultimately help determine what is seen as good or poor practice.

Martin Boroson, executive coach and director of the One Moment Company, says: “Some cultures bring out your best self: they place a premium on honesty, transparency and vulnerability, and they have well-established processes to promote real communication.

"Other cultures tolerate behaviours that discourage authenticity, such as gossip, backstabbing, scapegoating, political manoeuvring and the punishing of whistleblowers.”

One way in which organisations can influence this is by making sure they recruit the right people in the first place, and not just promoting automatically or as a means of retention.

Charlène Gisèle, a high-performance coach and burnout adviser, says: “Far too often, leadership positions are wanted for prestige and position as opposed to being the one who wants to innovate, create, inspire and elevate others. Organisations want to promote people who embrace the challenge of problem-solving and encourage ideation and creation.”

Pay and recognition also have a role to play in developing and encouraging the right behaviours, whether that is through pay, bonuses or share awards.

Liz Bailey, senior manager at Lace Partners, says: “If people are seeing that leaders that are promoting authenticity and transparency are being recognised and rewarded, they feel more positive about the [organisational] culture and strive to do the same.

“If leaders are being recognised for just being good at their job and bringing business in rather than leading teams, then it has a knock-on effect as employees think this is how they need to behave in order to be rewarded and recognised. Unfortunately, nowadays there are not many leaders that are rewarded for being authentic.”

It is important to speak to staff, too, to discover which values they see as important and would like to see embodied in leadership. Frequent check-ins or employee pulse surveys are good ways to get feedback, explains Derek Irvine, SVP strategy and consulting at Workhuman.

“Anyone can be an authentic leader as long as they are willing to take the time to learn what works best at their own organisation," he adds. "Truly listening to others and hearing their perspective or concerns is a powerful way to?show you? care and will ensure your employees feel psychologically safe.”

An authentic future

Increasing wellbeing and reducing stress will be an important part of leadership going forward, and an authentic approach will be needed to ensure this is genuine and effective.

Elaine Cox, leadership development expert and co-author of Braver Leaders in Action: Personal and Professional Development for Principled Leadership, says: “Organisations need to provide encouragement and support for leaders, and others in key positions, to reflect and learn about themselves so that they can view and adjust their relational impact in a safe, coaching-type environment. This, coupled with transparent communication and decision-making and emotionally intelligent leadership, will foster a culture that encourages people to support each other.”

Those organisations that can create a culture with authenticity and trust at its heart stand to benefit in a number of ways.

“We all know what it’s like to work for a good boss, someone who motivates, challenges and supports us; they create a safe space for us to be authentic and bring our true selves to work, and this allows us to do our best work, and enjoy it,” says Blakey. “This is where true engagement and high levels of discretionary effort are willingly given.”

He cites The neuroscience of trust research, published by the American neuroeconomist, Dr Paul Zak, in January 2017, which finds that high-trust organisations benefit from 50% higher productivity, 13% fewer sick days, 76% higher engagement and 74% less stress.

In fact, being able to demonstrate authentic leadership can have more impact than many other, more tangible benefits, says Gisèle: “An authentic leader is both a motivation-maximising leader and an engagement-maximising leader.

“Where there is authentic leadership, you will see people actively want to be part of that team; many people would forgo salary and other benefits to be part of a team that is led authentically.”