The central problem is that many leaders are not role models of those desired behaviors. Every time, workers are less capable of pointing to leaders they truly admire and want to follow in their steps. Today’s top leaders work siloed in their realms and sometimes even push their teams to do the planned work, making themselves oblivious to “how” the work is being done. They might even recognize and celebrate some of their team members for getting the job done, even if a trail of “dead bodies” is found on the way. This way, they set the wrong example for their teams, and employees quickly pick up the game’s rules, turning the workplace toxic.
HR leaders have long been unequipped to influence those matters effectively, with a few brave exceptions. Companies’ boards were effective in tucking HR decisions under CEOs’ directions, keeping a single line of power. After years of constant undermining, many HR leaders have lost the trait and are no longer cut out to make a difference.
And due to the board governance model in the US, the vast majority of Board Directors have not acted significantly on behalf of the employees. They are not requesting executives to fix those situations. Investopedia defines the Anglo-US governance model adopted by our corporations in the following way. “The Anglo-US model, also known as the Anglo-Saxon model, was crafted by the more individualistic business societies in Great Britain and the United States. This model presents the board of directors and shareholders as the controlling parties. The managers and chief officers ultimately have secondary authority. Managers derive their authority from the board, which is (theoretically) beholden to voting shareholders’ approval; however, most companies with Anglo-US corporate governance systems have legislative controls over shareholders’ ability to assert practical, day-to-day control over the company. The capital and shareholder structure are highly dispersed in the Anglo-US markets. Moreover, regulatory authorities, such as the US Securities and Exchange Commission (SEC), explicitly support shareholders over boards or managers.” And that defines the power of capital over all other relations to a company, including its employees. Therefore, change will only come if that model evolves. European companies generally adopted a different governance model called “The Continental Model.” This model has a more balanced approach to power, and employees may be represented on the supervisory board by Unions.
As most board directors have mandates due to direct appointments from capital investors, they tend to see employees as a means to an end. Follow the money! The ending here is a high return on investment; everything else has to serve that purposeless purpose. That is the central reason we cannot see the actual results of so many activities said to address disparities involving People in so many companies. If this quarter is not financially sound, there are no severe consequences of stopping or halting efforts to improve employee morale and fairness. Please note that I am not saying there is no progress; the progress is too slow to be noticed.
New governance tools and models have been created in the last decade to address society’s concerns. The conflict between investment power and diverse stakeholders’ interests many have been trying to address. ESG (Environment, Social, and Governance), B-Corporations (a Certified B Corporation is a company that has voluntarily met the highest standards for social and environmental performance), and others are trying to balance better the power in the boardroom, and even in its early days, it has created much noise.
Meanwhile, new generations of employees are doing their part in finding escapes to the workplace’s meat grinding. Millennials and GenZeers are promoting new ways of working. They adopted remote working, refusing to follow mandates to return to the office. If the workplace is unhealthy or not motivating enough, they do not pretend to be engaged as previous generations. If payment is low, they hold multiple jobs. Those are signals that the “patient” is unwell and is trying to respond with a high fever. They are just trying to combat a situation that has been going on for so long that no one wants to deal with it anymore.
My new big questions are the following. What will happen to millions of workers displaced by high AI productivity tools? If corporations struggle today to adapt to employees’ unique demands, what will happen when high productivity makes them redundant? Europe’s welfare system is built to accommodate its citizens in hardship with decency, but not in the US. If we cannot rule in favor of so many workers when we live our fat cows’ period, what will happen now that the thin cow period is about to start?