Inclusive, value-driven leadership sounds wonderful. But how is it cultivated, put into practice, and maintained? This week’s guest Peter Wuffli is a proven expert on just that topic, and his insights highlight our sixth installment of Perspectives from the Top.
Inclusive, Entrepreneurial, Inspired (ft. Peter Wuffli)
Peter Wuffli shares some of the mindsets and methods he’s used to create organizations so well-integrated and inclusive they’re the subject of Harvard studies
OPENING QUOTE:
“What I find incredibly important in a leader is to be self-aware of what he is driven by and to then make his value system transparent.”
—Peter Wuffli
GUEST BIO:
Peter Wuffli is a Swiss businessman and leader who began his career in McKinsey, becoming a partner before moving into financial services as CFO of Swiss Bank Corporation. After a series of mergers, Peter was appointed the CEO of Union Bank of Switzerland at just 44 years old. His consolidation of UBS and its subsequent impact is now the subject of a Harvard case study on creating integrated organizations.
Peter is also an author of books on topics including inclusive leadership and alleviating poverty through impact investing.
Links:
CORE TOPICS + DETAILS:
[4:53] - Obligation to Dissent
Disagreement as a duty
At McKinsey, Peter learned and internalized that idea of ‘obligation to dissent.’ When a team, superior, or coworker advocates for a strategy or decision you don’t believe will be effective, you’re not only given the space to disagree but you are ethically required to do so, because to stay silent would be to potentially let your organization follow a path that leads to negative results.
[18:52] - The Power of Partnership
Leadership is a two-way bridge of trust
People will always recognize when you work with them, listen to them, and respect them for what they know. If you’re sincere and build a trust-based relationship, you and the people you lead or who lead you will accomplish great things together.
[29:35] - Startup Thinking in Big Organizations
Where it excels and where it falls short
Peter explains that while having an entrepreneurial mindset can help large, established organizations create an orientation toward action and growth, when taken to extremes it can handicap the same organizations with unnecessary risks.
[45:13] - Never Turn Down an Opportunity to Learn
Sometimes they’re at eye level, not above you
One of Peter’s parting messages to all listeners? Always look for opportunities to learn, and never let one pass you buy. Meanwhile, remember that those opportunities don’t all come from mentors, employers, and superiors— they often come from the people at your level whom you work with every day and might otherwise overlook.
[46:05] - Balance in Everything
Passion for work doesn’t preclude passion for life
Peter Wuffli dislikes the phrase ‘work-life balance,’ as it suggests that the two are at odds with one another. But the truth is that one can have a passion for their work and also pursue the other areas of their life to the fullest— not only is it possible, but it’s essential for a fulfilled life.
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ABOUT THE HOST:
Chris has shown over 21,000 leaders in over 1500 organizations globally how they can discover their secrets of success in a way that meets and beats their organizations specific challenges.
Chris has done this across sector, culture and geography - UBS, HSBC, KPMG & London Underground, legal firms to construction, tech and IT, to retail, facilities to scientific research, police to not for profit, pharmaceutical to SMEs. From the UK National Health Service of 1.4m staff and UK Government to the Red Cross in Myanmar, from Investment banks in London to Middle East Telecoms, from the Chinese Space Program leaders to HR Directors in India and global retail CEOs in Rome.
When he was the Global Head of Leadership at UBS, overseeing a staff of 70,000 across 100 countries, his team helped the bank transform organizational performance to increase profitability by 235%, market capitalization by 50% and win numerous awards. This is now a Harvard Case Study.
Chris has been quoted as a business leadership expert globally in the Harvard Business Review China, FT, Wall Street Journal, Le Monde, New York Times, Business Week, Time Magazine, Washington Post, Times of India, Straits & Gulf Times and many others. He judges business awards and has done over 350 TV interviews on leadership and business on BBC, Sky, Bloomberg, Al Jazeera, CNBC & CNN. He’s also skied at 60mph by accident.
Learn more about Chris at: ChrisRoebuck.Live
CREDITS:
Peter Wuffli:
What I find incredibly important in a leader is to be self-aware of what he is driven by and to also then make his value system transparent.
Chris Roebuck:
Welcome to Perspective from the Top. I'm Chris Roebuck, global keynote speaker with unique leadership experience from military, business and government, bestselling author and your guide to greater success. Together, we'll discover powerful insights from the world's leading thinkers, doers and trailblazers. The must know trends, thought provoking revelations and practical actions you can use immediately. This is your exclusive and personal shot of insight and inspiration to help you get to the top. Welcome to you and all of our perspectives from the top community around the world. It's great to share the insights of such successful people with you to help you get to where you want to be. Today, our guest is a Swiss businessman who started his career in McKinsey becoming a partner before then moving into financial services with Swiss Bank Corporation, becoming CFO there.
Chris Roebuck:
In a series of mergers and acquisitions, including merging SBC with Union Bank of Switzerland, UBS was created as a global bank in 2002 and soon after he became the CEO of UBS at just 44. Over the next two years, he oversaw the consolidation into one UBS and the growing impact of UBS on the sector, which is now a Harvard case study on creating an integrated organization. He left UBS in 2007 to found his elea Foundation focused on alleviating poverty around the world through entrepreneurial means. He's also on the board of Partners Group, one of the largest private equity investors in the world on the board of Sygnum Bank, the first digital asset bank in the world, honorary chairman of IMD Business School and vice chairman of Zürich Opera. He's also author of books on Inclusive Leadership and alleviating poverty by impact investing. So, it really is my great pleasure to welcome Peter Wuffli to Perspectives from the Top.
Chris Roebuck:
Peter, great to have you on Perspectives from the Top. I just wanted to go into the way you've got to where you are now, because one of the things that we found on Perspectives from the Top is that when people become successful, somewhere in their past is a boss or a mentor who did things that truly inspired them, guided them, however you describe it. Was there somebody there in your past and what did they do to help you get to where you are now?
Peter Wuffli:
Well, thank Chris. Chris, it's a great pleasure to be here and thanks very much for having me. Well, I joined my first job was essentially working as a consultant with McKinsey. And if you work with McKinsey, you don't have one, you have literally hundreds of mentors, both within the company. With every new assignment, you basically get a director, you get a principal who is your boss. You get an engagement manager who directs you. And then obviously you have all the clients, I mean, the client teams. And so, I couldn't pinpoint one of the role models. There were literally hundreds of people that I took kind of my clues on. And at the end, I think what I would recommend is just to have an open attitude and be open and watching more senior people. I mean, what the structural situation, if you're a McKinsey consultant, you're always about five to 10 years younger than the rest, right? So, it was always called the insecure of achiever. And obviously what that does is if you are open to it, you have a lot of people you can learn from.
Peter Wuffli:
So no, there was not a single individual. There was hundreds of them and I learned a lot from them during 10 years as a consultant and then as a partner and a member of this Swiss office team at McKinsey.
Chris Roebuck:
And interestingly, you must have been inspired through the collegiate atmosphere that created at McKinsey. And did you try and replicate that sort of atmosphere in subsequent organizations that you worked in because it had inspired you?
Peter Wuffli:
Yes, absolutely. I think you're hitting the nail on the head because on the first day when I started at McKinsey, I learned this so called obligation to dissent, which meant that you are not only have a right to voice your opinion, but if you're working on a client assignment and you really don't share the view of the senior partner, you are obliged to disagree. And I must say this lesson, I applied, obviously at McKinsey, there it's a duty, but it created a very, very deeply felt sense of partnership. And still today, the power of partnership for me is the number one, two, and three leadership rule, I think. Unless you're able to work at eye level with other talented and inspiring people, I think leadership will not happen. And that also inspired my philosophy of inclusive leadership, which is more horizontally oriented than vertically, which I do feel is the right way to lead in a complicated global world where you just need to harness a lot of different perspectives, talents, skills, backgrounds in order to be successful.
Peter Wuffli:
So yes, I essentially applied partnership principles everywhere, and we have been together at UBS at the time so you must remember some of it.
Chris Roebuck:
I remember much of it Peter.
Peter Wuffli:
And quite frankly, interestingly I felt that we can apply partnership principles in very large corporate organizations, but also in very small, more entrepreneurial organization. We can apply it in nonprofit, in my philanthropy, for example, as well as in kind of commercial organization. At the end, it's just the way how people work together. And for me, it's still one of the conundrums that it doesn't happen so frequently. I mean, it's in my view so obvious that we need to partner among talented people across the [inaudible 00:06:51], across different philosophies, across different functions in an organization. And still many bosses are incredibly hierarchical. I mean, you still have a lot of imperial CEO types with three titles, chairman, CEO, president, right? And I'm just totally convinced that partnership is what at the end helps you become an accomplished leader.
Chris Roebuck:
And we will dive into that power of partnership and the inclusive leadership thing as we go on. But one of the other things I wanted to explore that is somewhat unique to you and maybe one or two of our other guests is that because you're Swiss, there are sometimes comparisons between business leadership and military leadership. Now in most countries, leaders just cannot make that comparison unless they're in the military or they're in a commercial business. But of course, Switzerland, you have the fund, the duty, the obligation, however you might describe it to spend time in the military in national service. Did you find that that experience in the military actually was of value to you in business as well?
Peter Wuffli:
That's very interesting, Chris, and I must say I have done a series of podcasts, but it's the first time I get this question. And in fact, I have done about a 1000 days in Swiss military. So, I was an officer. I ended my career as a captain and intelligence officer. And yes, I mean, the answer to your question is yes, I have learned a lot as a young guy, particularly as a lieutenant being 22, being 23 years old, being in charge of 24 grownups mature people, having to kind of lead them, having to manage them under very adverse conditions when you're tired, when the weather is bad, when you are on the time pressure, when you're stressed, when you get lots of pressure from your bosses. And I guess in my view, what is very valuable about military leadership education are three things.
Peter Wuffli:
On one hand and I think the most important is resilience. I think, to have the discipline to work under stressful conditions, I think that's one. I think the second one is method. I think the military has very clear methods on how to operate, how to develop immediate measures, how to develop a time plan, how to form a decision. So methodology on leading I think is a second very important point. And the third one quite frankly is crisis management. And it's very interesting as you may know, I have been involved with IMD, which is a business school in Lausanne for over 25 years. I was chairman there for many years and we have actually established a Crisis Leadership Program in the Executive MBA program together with the Swiss Army. So, the last week of the kind of EMBA program was done in a crisis management mode in a bunker in Switzerland where Swiss Army Officers challenged the team.
Peter Wuffli:
And I must say, I've attended in the middle of the night together with the head of the Swiss Army this session, it was hugely impactful. I almost was shivering emotionally because it was for me, globalization at its best, right? You had a class of maybe 60 students. They were coming from Saudi Arabia, from Pakistan, from Brazil. They were young ladies. They were older men. They were, I mean, a level of diversity you couldn't imagine. And they were all under the guidance of Swiss experienced Swiss Army Officers were working on crisis scenarios specifically on the Geneva Airport being hijacked by terrorists, and they had to work their way through it. And I must say that was hugely valuable. And so, we felt that this was actually something that the world can benefit when you can marry a diverse group of leaders with the military methodology. I think to also show the limits, I think where military leadership does not work is on content on analytics because Swiss never since 1848 never had to fight the war so at the end, it's all theory.
Peter Wuffli:
And I guess I have seen examples where corporate leadership systems with lots of Swiss Army guys were very disciplined and very resilient, but going in the wrong direction because they didn't do their analysis right. And so, I think one should not confuse method with content and with research.
Chris Roebuck:
You just reminded me of a most beautiful incident when I was teaching on an MBA program over a weekend, doing a similar sort of process where a young ex-military officer with the greatest, inspirational, confidence and direction managed to take his team in completely the wrong direction and they all followed him willingly.
Peter Wuffli:
Right. That's exactly what I meant.
Chris Roebuck:
So, it's absolutely true. And for our listeners, I need one, to openly admit that Peter and I worked together. I was at UBS for about five years during the creation of UBS as a global bank, which is now a Harvard case study. And I was also a professional British Army Officer for about five years. And it was interesting that from my perspective as a professional Army Officer, within the management of UBS, there was a visible difference in the things that you are talking about, Peter, between the Swiss leaders, the Swiss senior leaders, and those who are non Swiss in terms of that basic method of getting stuff done, which you might, as an objective observer, you might find that interesting. I could just do a comparison between the Swiss guys and the American guys and say, "Yeah, there is a visible difference that shows that the Swiss military system does make a difference." So, link to that then. Do you see a direct link therefore between good leadership, inspired people's success, profitability and return on investment?
Peter Wuffli:
Well, I guess that's one of the enigmas in the leadership research, right? I mean, when I started to research leadership as a topic for my book, Inclusive Leadership, I tried to get some grips to this answer. And quite frankly through, I don't know, at the time, I think there were 70,000 books written about leadership.
Chris Roebuck:
Probably More now.
Peter Wuffli:
I think it's completely non conclusive. And Phil Rose, Prof. Phil Rosenzweig is a good friend of mine. Professor [inaudible 00:14:03]. He wrote his book, The Halo Effect, where he essentially demonstrated with many cases that when a company is at its best in terms of performance and in terms of its reputation and in terms of its kind of appreciation by all the stakeholders, then also the leaders are supposed to be the best. And as soon as the company hits the bottom, then the same leaders who are actually doing exactly the same things day in day out, they are immediately being the worst. And so, at the end, I think it's still very unclear, A, what is really good leadership, whether charismatic leadership is the right one, whether it's more the humble kind of Collins type of level five leadership. I think they very unclear what type of leadership in what situation and with what results. I mean, at the end for me, I guess ethics is an important component.
Peter Wuffli:
What I find incredibly important in a leader is to be self aware of what he is driven by and to also then make his value system transparent, particularly in a globalizing world where we do have a whole range of philosophy and deeply ethical DNAs ranging from [inaudible 00:15:29], which is more about kind of respect to kind of American libertarianism, which is about radical freedom and then a whole series of values in between with different religious influences. And so, I think what is important for me is that a leader articulates where he stands and what his level of responsibility is and how he kind of applies this level of responsibility in accordance with his resources and with his capabilities and with his ambition. So for me, and that's why I guess an important chapter in my book, Inclusive Leadership, is about ethics. It's about how to deal with freedom and how to take responsibility as a leader.
Chris Roebuck:
Yeah, I think it's really interesting in the sense that there is that conundrum of what leadership is optimal in what situation, not only the situation in terms of the organization, but the situation in terms of the people, how they're feeling, what's happened before, where they want to go. One of the things that I think is clear is that there is evidence that day to day action, there are certain day to day actions by leaders that will potentially maximize the effort of their people through the psychology, through the neuropsych, things like developing them, asking for their ideas, showing you care and that sort of thing. How that all then connects through a system which effectively must have a time lag and other filters into profitability and return on investment is I think exactly where the complication is. So, I think it's a fascinating area.
Chris Roebuck:
Certainly when I try and talk to leaders about what good leadership is, I tend to concentrate on there are certain things you can do. And what I've found fascinating is over 10 years, I've asked leaders around the world, what the best boss they ever had did on a day to day basis. And the list that comes out is absolutely consistent irrespective of where in the world. And it's just simple things like I mentioned, asking for ideas, developing me. Honesty and integrity always come out as key. Trust is also one of the top three. So, it is there's things that we know will make people give effort, but then as exactly as you say, how that has to be, how the leader has to do those things within the context of where they are and how that feeds through gets confusing.
Chris Roebuck:
Linked to that and this power of partnership thing, which is interestingly what all of the things on that list reflect, an emotional partnership between the boss and that individual and team. So, you've led UBS Global Bank. You've seen corporate leadership over many years, and now through your foundation, you're working with entrepreneurs and not-for-profits. So, how does the dynamic of effective leadership vary between those, or is a good leader a good leader wherever they are, and the sort of cross cultural dynamics, how does that seem to affect leadership?
Peter Wuffli:
Yes. I guess, I would lean to the second of your implied answers and exactly because of my experience in leadership positions at executive level, at board level, in large organizations, in small organizations, in non-profits in for-profits, I guess I have come to distill several generic leadership kind of lessons that are actually at the source of the book on Inclusive Leadership because I felt I needed to summarize it. And at the beginning is, as I mentioned before, this power of partnership. And I couldn't agree more with you, at the end people will recognize if you work with them, if you listen to them, if you respect them for what they know, if you are sincere and build a trust based relationship to accomplish things together. I think that's the first, that's the foundation. And I think there is no organization where the single hero will just do it all of himself.
Peter Wuffli:
I think these type of organizations in my view are probably at declining and in today's complicated and global world with multicultural influences. But I think then there is a second element and the second element in my book is leaders should do real work. And obviously it depends on what kind of a person you are. But I remember when I came in being a Swiss Bank Corporation's, youngest ever externally hired executive team member, and I became Chief Financial Officer, and I was a Consultant before. And you can imagine how these probably 150, very smart, very elaborated accountants, tax specialists, legal specialists, finance specialist at UBS at Swiss Bank Corporation were kind of reacting when a consultant was kind of put above them who had the tender age of 36 years. And I remember I had quite a lot of skeptics and one of them was in the tax team.
Peter Wuffli:
And at the time, we got the mandate from our group to look at the holding structure as an alternative to how we were organized. And I actually wrote [inaudible 00:21:14] the first draft paper myself and then put it to the tax people. And the tax people were hugely impressed because they said never, ever had a member of the executive team actually written something of himself, right? They always kind of were there and they bossed around, but actually doing real work and obviously doesn't need to be writing. I happen to be kind of reasonably experienced. I was a journalist during studies. I love writing. I have written three books in my life, so I love writing. But I think what's important is that a leader gains the trust of his people by doing real work and not just kind of supervisory kind of speeches that he hasn't written himself kind of rah-rah events not being substantiated.
Peter Wuffli:
And so, the leader has to be a professional in his area. And I think that was for me, always very important to be a content leader, not everywhere, but at least in some areas where you were just respected for what you did in terms of real work.
Chris Roebuck:
And that also goes, I think that goes back to the power of partnership thing that you mentioned, and on that list of things that makes people truly respect their leader. It is one of the beautiful ones is show they care about me. And the amazing figure is that the research would suggest that a leader who shows they care about their people versus one that can't be bothered can potentially get up to 25% more effort. And you think it is that act of making yourself one of the team, I think. The fact that the leader is not separate from the team, the leader is part of the team. It's about creating a, we, not me culture, which interestingly then goes back to some degree to the military concept that we are all in this together. And I think that that's really, really powerful. So, you are now working to reduce poverty through entrepreneurship via your foundation. So, can you tell us what you are doing and why this entrepreneur approach is in your view key to real success on the ground?
Peter Wuffli:
Yes. My wife and I created elea Foundation for Ethics in Globalization pretty much 15 years ago and it was essentially for three major reasons. One is that I feel that the [inaudible 00:23:57] trend of our generation and probably the next to come is globalization, and there is no other so powerful that has transformed our world since about 30, 40 years. And globalization, as we by now all know has basically positives and negatives. It creates a lot of wealth, particularly for poor people, but it also leaves people behind. There are many people who don't have access. And so, if you're born in Switzerland, if you are kind of among the fortunate to do a career that I have done, then it's obvious that you are on the winning side of globalization. And so, I felt that it's in a way, an ethical responsibility to share some of the gains from globalization with those who do not have access to globalization opportunities.
Peter Wuffli:
That was the number, the ethical imperative. The second one was that I have a passion for the topic. I started in university as an economist, development economics. And I've always wondered why there is poverty and what you can do about it. And I think there is today a huge body of empirical research. I mean, two years ago for the first in the history of the Nobel Prize, Nobel Prize for economists was awarded to two empirical poverty researchers. And so, as an economist, I was always passionate in helping to overcome poverty, which is the sustainable development goal of the UN number one and poverty by 2030. And the third reason had to do with life planning. I mean, I was fortunate to become a CEO at 44 years. And obviously if we take care of our body and soul, we'll have some chance to be 90 or plus in our life.
Peter Wuffli:
And so, the question was always, what do I do after the executive period? And so, these were the three motivations why we set up elea and why it's called Ethics in Globalization. So, the idea is really to fight absolute poverty with entrepreneurial means and how we do that, we invest in young companies in themes like agriculture, like retail, like employable skill building in countries like Bolivia, India, Zimbabwe, Kenya, South Africa, Philippines. And we do this by investing in companies rather than in projects. And I guess that comes to your question, why is entrepreneurship relevant? It's very simple. If you invest in classical development project, you have an employed project leader and he will be the project leader as long he is employed. And the timeline of these projects typically are 12 months, 24 months, maybe three years, maybe four years. But when the project is basically completed, then the project leader goes somewhere else and a few years after the impact is not there anymore.
Peter Wuffli:
Now, if this is a temporary task to, I don't know, build an infrastructure, build a building or power station or a road, then of course that's okay. But if the idea is to create a model to sustainably address poverty, for example, to create an institute that offers employable skills to people so that they can become employed and earn a living for themselves and their families, or if you want to help smallholder farmers to essentially increase their income, or if you want to help small shop owners to be more productive, then you need entrepreneurial business models and an entrepreneur. The difference between a project leader and an entrepreneur is the entrepreneur thinks in decades and generations, not in months and years. And therefore the entrepreneurial approach for the kind of poverty alleviation that we do is just more sustainable.
Peter Wuffli:
And when you think about how the really successful economies of this planet have become about, I mean, the Swiss or the American or the German, I mean, they were built through development projects, they were built through big entrepreneurial personalities, building enterprises for ideally several generations and that model is what we are trying to replicate. So, we have today, roughly two dozens of ventures in these three themes. We have an active team of about 24 people, all professionals. We sit in boards and we are an active investor during seven to 10 years, helping these companies growing from, I would say the post startup phase to an early growth phase. We want to be the first institutional investor in these companies and we want to the last philanthropic investor.
Chris Roebuck:
Your point, your sort of historical point is interesting. If I reflect back on my economic history, if you look back for example, at indeed the creation of the industrial revolution in UK that then spread around the world, all of those first movers were entrepreneurs who had an idea about something, be it cloth manufacture, be it steam engines, be it scientific and the application of those ideas out into a business. So, the power of entrepreneurial thinking then creates energy to build and grow enterprises. And the next part of the question, I actually, I know what you're going to say, but it will be useful for our listeners to hear your responses. Do you think this could be used to energize larger organizations as well as the smaller organizations? What are the challenges of potentially utilizing entrepreneurial thinking in a larger organization to make it more effective?
Peter Wuffli:
Absolutely. And I guess there, my experience as a board member of Partners Group for 10 years comes into play. Because as you know, I spent the first 22, 23 years of my career when I was with McKinsey and when I was with Swiss Bank and then UBS, I essentially spent in the large, publicly listed corporate environment. And I must say when I switched to adopting the private equity lenses, joining the board of Partners Group where I spent 10 years and where I was the head of the risk and audit committee first and then I was several years it's chairman, I saw kind of a different perspective on corporate leadership. And I saw how in many ways, current corporate governance in listed companies is stifling entrepreneurship. I mean, we see a lot of what I would call governance correctness where boards of large global diversified conglomerates are more and more behaving according to codes of conduct that have been established by stock exchanges, by regulators, by professors who basically share the same characteristics that they actually never led a company.
Peter Wuffli:
And that a lot of the principles and rules are about to avoid risks, about to implement socially acceptable and correct mechanisms but which when you really look at it, don't necessarily ensure that the company stays course and works as a successful entrepreneurial entity. And I must say this is a bit of a worry, that particularly those large corporations with the diversified share holdings, where essentially there is a combination of very few activists with sometimes more than questionable agenda and the majority of passive funds, ETFs pension funds with no real industrial agenda in a way own the company. And you have board members who are more and more composed according to all types of diversity criteria where competence and skills, and does not range at the top, but somewhere in the middle of the criteria and where the CEO is in a way changing every four to six years and where you then wonder, where is the entrepreneurship in these companies?
Peter Wuffli:
And I think that's in a way, one of the reasons why we see such a tremendous search in private equity, and we see such a decline in publicly listed companies. So, I must say from comparing the experience within the corporate kind of large global diversified, publicly listed environment versus private equity, I think in many ways the private equity model is superior because there is a very clear alignment between ownership and management. There is a very clear action orientation. There is a very clear entrepreneurial long term agenda which has to do with the industry, with the entrepreneurial opportunity, and which does not have to do with governance correctness. So, in my book, this is something to keep an eye on and watch the situation.
Chris Roebuck:
To some degree, I mean, the [inaudible 00:33:28] of a risk function is to minimize risk. The problem is that if a risk function is completely successful at stamping out all risk, it has therefore effectively stamped out-
Peter Wuffli:
The opportunity.
Chris Roebuck:
... Any activity, any opportunity. So, it's just as you say, whilst it might make the governance look good, the organization is inevitably going to fail because in due course, it's not going to be making any money which I think is to some degree self obvious. But from what you are saying, many people have missed this somewhat obvious point.
Peter Wuffli:
Yeah. I mean, in a way, I mean, the world moves in pendulums, as we all know, right? And when I started my career there, we actually grew up with Barbarians at the Gate, with the RJR Nabisco, with the managements being all too powerful. And then we had this Shareholder Movement which people today have forgotten that The Shareholder Movement was actually originating from institutional investors, from pension funds, who said, "We are the owners of these company, not the all too powerful CEO and the management and that they basically build corporate headquarters, use corporate jets, waste a lot of money for prestige things, right?" And I think that's when I became CFO and that's why I wholeheartedly embraced the idea that the ownership of the company is actually with the shareholders and not with the management. And then obviously we have seen all the excesses that have been talked about a lot and I think then stakeholder capitalism became more fashionable.
Peter Wuffli:
And while I completely understand why there needed to be a correction from a exaggerated shareholder value thinking which was becoming too greedy, too short term, too much kind of value money oriented as opposed to responsibility, societal responsibility oriented. We really need to be careful not to throw out the baby with a bathtub and to go into a stakeholder capitalism, which de facto challenges liberal capitalism at its very core, because in a way what it says is it's no longer the owner and there is no property, there is no private property ownership of companies, it's stakeholders. It's a combination of clients, shareholders, employees, public, regulators, activists, NGOs. And quite frankly, there we are getting very close to a dangerously socialistic model of organizing the economy and I think that's where we are now.
Peter Wuffli:
So, that's why I obviously am the first to argue that companies should have a high degree of social responsibility. They should work and use their resources and their mandates to fight climate change, to help alleviate poverty and to help make progress on UN sustainable development goals. But we need to make sure that we don't erode the ownership in the companies as a core principle of liberal capitalism.
Chris Roebuck:
Yeah. That's an interesting perspective. On the entrepreneurial side of it, one of the things I do find interesting when I talk to organizations leaders around the world, one of the questions I ask is just out of interest, how many of you in this room have either been an entrepreneur or worked for an organization that's had say less than 20 people in? And it's really interesting that some audiences in organizations where I feel that there is a bar, there is a dynamic, a reasonable number of hands will go up. Whereas in other organizations you can have 300 people in the room and not one hand will go up. And you think, so that's really interesting in terms of if there's 300 people in this organization who are all senior leaders and not one of them has had any experience of being an entrepreneur at all, how on earth can you engender any sense of seeking out proactively opportunity and just so listeners know, but Peter and I did some work on what we called entrepreneurial leadership at UBS, trying to encourage long, serving corporate leaders to start thinking more entrepreneurially and seek out opportunities.
Chris Roebuck:
And what I found amazing in that period was that there were a group of people who had been long, serving corporate leaders, but when given the opportunity and told they had the opportunity to think entrepreneurially and were helped to do so, their change in mindset was quite fascinating.
Peter Wuffli:
Yeah, I think you're quite right. And I think in that sense, I think what really is in my book, a very encouraging perspective is that there is more competition between different ownership and governance model driven by on one hand, I think in a way, the revival of the good old family business. I mean, I remember times when I worked at McKinsey at the time 15, 20 years ago, the family business thinking was dead, right? I mean, everybody said, "Well, these family, they're not professional enough. At the end, they will at some stage IPO, their company." So, I think at the time, one felt well at the end, the end goal is to have a publicly listed company. I think what we've seen in the meantime is all the question marks with governance correctness of the publicly listed company with a diversified shareholder base.
Peter Wuffli:
While at the same time, we have seen a tremendous revival of family companies that also quite frankly, driven by, for example, Asian, the importance of Asia, where family companies are the norm and the other is private equity. I think we have seen private equity becoming more mature, becoming more long term, becoming more building rather than just financial engineering. And I think what all this creates is a tremendously healthy, competitive situation for good outcomes. And being a liberal at heart, I really love competition. I mean, I think, and particularly competition for ownership models and for governance philosophies, I think is a very healthy competition.
Chris Roebuck:
The culture, the search for opportunity, I've worked with organizations that have been private equity owned and without doubt there is a much more proactive search for opportunity in the management teams and in the whole organization where it's private equity owned, which goes to your point. So, sort of beginning to finish up then, what are your plans now to take your foundation forwards?
Peter Wuffli:
Well, when we started 15 years ago, I mean, we have been named a pioneer by leading Swiss news newspaper which made us proud. And it may in a way be have some truth in it because we started to invest before the time the expression kind of impact investing was coined. I mean, we created the foundation 2006. 2007 was the beginning of the impact investing trend. And to be honest, I mean, we called it initially entrepreneurial philanthropy until at some stage we found out that what we were actually doing is impact investing. And when I started and I told my colleagues what I was doing, they were very polite and they said typically, "And what else do you do?" As a reaction. So, I think it was still seen as being somewhat odd for somebody with my background. And I must say this has completely changed.
Peter Wuffli:
I mean, today impact investing is at the forefront. It is mainstreaming very rapidly. Many corporations are embracing it. And for me still being involved with IMD, one of the highlights is always when I go together with the Executive MBA students who are kind of season corporate executives. And my last trip before the pandemic was actually to Peru a whole week for about a good 30 of Executive MBA students who spent a whole week on our topic on philanthropic impact investing. And I must say here that elea Foundation has donated a chair, elea chair for social innovation at IMD. And so, this is part of the curriculum and we had these executives and doing interviews with impact entrepreneurs, creating investment proposals. And it was for me a huge eye opener, how these kind of, they were country managers from Nestle.
Peter Wuffli:
There were kind of department heads from ABB. I mean, there was traditional corporate executives. The bus that this whole impact investing world created was hugely rewarding. So, in that sense, we see a lot of potential for us just to grow further. And I mean, sadly COVID has obviously been incredibly sad for poor countries, so has pushed poverty back. I mean, we were before in 2019, we were on a very good trajectory to come close to reaching the UN sustainability development goal number one, and poverty I must say, this has probably been now held back for three to five years depending on which statistics you believe in. And so, I think that continues to be a lot of work in fighting poverty, in growing our organization, in also looking for fields in terms of investment topics. I mean, one of the topics we are very excited about are areas where you combine fighting poverty with actively fighting climate change where for example, with climate credit, CO2 credits, current credits, you can essentially help poor farmers to gain more income and at the same time to reduce their impact on the planet.
Peter Wuffli:
So, they're very interesting, innovative investment areas. And so, I guess the path I see for elea is just to continue to grow our investment footprint, to add maybe new select teams to grow our team. We have now 25 professionals possibly to become a more global organization beyond Switzerland. And I must say, I see a lot of potential. I'm totally excited about the whole momentum between in a way refitting capitalism to be more purposeful and to actually help address the really big challenges that the world is facing, which is fighting poverty and fighting climate change.
Chris Roebuck:
That's a brilliant objective to have. So, finally then what would be one piece of advice that you would give to our listeners around just how to be, if they're a leader, how to be a better leader and what are the things that perhaps people who aren't leaders should just think about in terms of how they can be more effective in their jobs and organizations?
Peter Wuffli:
Well, I think one is just to never turn down opportunities to learn. I think that's for me would be number one. I mean, I have never turned down any kind of assignment be it with McKinsey, be it with UBS to do new things, to learn new things, to complement your profile. I think when you stop learning, then in a way you're capitulating. I think the second is really about this whole partnership thing. I mean, not look vertically, not look to your boss and to your subordinates, but to look at talented people at eye level with a partnership approach, developing deep, empathetic, trust based relationships again, where you can learn on one hand but also inspire others. And quite frankly, the last one that I tell to every student group, and I'm asked to give these kind of speeches is never, ever sacrifice family and friends to your job.
Peter Wuffli:
It's the worst thing you can do. And I've seen it over and over and over again, that people were too passionate about their job, workaholic working 7/24. And I mean, I have experienced it when you lose your job from one day to another, then you are back to family and friends. And when you are in such situations and do not have this backbone of family and friends, then you are in real trouble, which can go onto life threatening challenges. And so, I really advise everybody to basically be diversified in how to use life energy. I hate the term work-life balance because I think it is essentially a Marxistic term, which in a way says there is work which is anti-life, then there is life. So, that's not what I subscribe to, but what I really embrace is a balanced life. I think accomplished people need to have a balanced life.
Peter Wuffli:
And a balanced life means you have to obviously have a professional angle where you work hard and where you deliver results, but you have to have a satisfied family life, social life. You have to satisfy your personal objectives such as, for example, Opera in my case. And that makes you a rounded personality. And it's very interesting, we have at elea we have created a talent program a few years ago, where we hire young bachelor and master degree people 25 to 27 years old. And I always interview the kind of finalists and we have a huge number of applications land for this year's program. We had last year's program. We had 180 applicants. This year's, we raised the bar. So, they have to provide a kind of investment proposition until we got it down to 52 applications and we hired three of them and they were terrific people.
Peter Wuffli:
I mean, I really so proud of our people that apply for these jobs. And I always ask them, "What makes you tick? What do you look for?" And what they say is, "I want to be challenged. I want to work hard. I want to be promoted. I want to learn. So, I'm not one of those millennials who think about the next world trip and the next yoga lesson, but I really am ambitious, but I want to be in an environment of a team with accomplished personalities that in a way are well balanced and are not just about work. And I want to know why I come to work every day. I want to have a meaningful purpose." And so, I think that's basically what I would convey to upcoming leaders.
Chris Roebuck:
Peter, that's a great answer. So, other than your excellent book, Inclusive Leadership, how can people learn more about your foundation and what you do?
Peter Wuffli:
Yeah. We have a website which is elea.org, and I've written another book actually during the pandemic together with my colleague at IMD, Professor Vanina Farber who is the elea professor for social innovation at IMD. And the book is called The elea Way. It's essentially describing our journey towards sustainable impact over the past 15 years where in detail we have to put together what we did, what we learned from it, and what would be lessons for entrepreneurs, for investors also for researchers or just simply intellectuals interested in the topic.
Chris Roebuck:
And I've actually read Peter's book on that and it is a really interesting insight into some of the really big challenges face this world, but actually we don't think about or do enough about. So, that's another great [inaudible 00:50:19] from Peter, as well as Inclusive Leadership. Peter, thank you so much. That was really, really insightful, really amazing. And to our listeners, I think there are so many things you can have picked out from what Peter said just from the practical leadership aspects to really thinking about how organizations need to work in the future. So, thank you Peter so much. That was great.
Peter Wuffli:
Thank you, Chris. I enjoyed it.
Chris Roebuck:
Well, listeners, there is so much there to think about and act on. To be honest, I think even I'm going to have to go back and listen to Peter's interview a couple of times. From simple actions such as building collegiate relationships at work, to get things done, to really significant questions about the structure of organizational ownership, which truly best meets the needs of the current world and its challenges around poverty and climate change. Certainly Peter's key points at the end have real value. One, never turn down an opportunity to learn. Two, always working in partnership through trust based relationships. Three, never sacrifice friends or family for your job. Four, make sure you have a meaningful purpose to your work. To be honest, if we all listening today did just those four things as of tomorrow, it would transform the lives of all of those around us and also make our organization significantly more effective.
Chris Roebuck:
So, have a think about how you can use some of Peter's ideas to help you get to where you want to be. And don't forget that in a week, I will give you a more in depth view of the key takeaways from Peter, my insights, and three ideas for action in my reflections on the top. From my site, there are some really great ideas here also for me to pass onto my speaking and masterclass audiences. Now, if you've used any of the insights you've got from Perspectives from the Top and they've helped you, send me your success stories, I'd love to hear them. And don't forget to sign up on the website so you don't miss any of the future guests we have coming up over the next year.
Chris Roebuck:
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