Steward leadership
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Week5PowerPointSlides.pptxBUS509 Stewardship and Governance
Week 5
Dr Patrick Kakwezi
1
Agenda
Welcome
Corporate governance in the news
Review of Wilson’s approach to Steward Leadership (moved forward from class 11)
Case study
Steward Leadership (Wilson)
Consider brief case examples – Mark (p.86) and Wilson himself (pp.96-97 and 104-105)
Steward leadership is the efficient management and growth of organisational resources through leadership of staff and activities as a non-owning steward-servant, in order to achieve the mission according to the objectives of the owners (p.86)
For faith-based organisations, the owners are God and the stakeholders; for corporations, the owners are shareholders.
Steward Leadership (Wilson)
Wilson considers the model of Block and commends it, however he notes Block’s emphasis on “empowerment” and concludes that “a weakness in Block’s definition of stewardship is that it is too strongly biased toward servanthood and the redistribution of power that the leader retains very little legitimate power or authority in the end, just service to those with redistributed power.”
We can thus see that Wilson emphasises the power of the steward leader’s role, power used on behalf of owners/stakeholders
Steward Leadership (Wilson)
Rodin’s book on steward leadership is also influential (2010). Rodin’s view: Commitment to our call as stewards guides us as steward leaders…but we are stewards first. Rodin spends much of his book evaluating the transformations that every steward leader must go through. This occurs simultaneously at four levels – the steward’s relationship with God, with self, with others, and with God’s creation. Each relational transformation is a journey.
Rodin states that there are 8 specific impacts from this process:
Steward Leadership (Wilson)
Steward leaders are united with the people they serve
Steward leaders cultivate people
Steward leaders develop whole people
Steward leaders harness the power of people
Steward leaders build and value community as its own end
Steward leaders are caretakers of their communities
Steward leaders marshal resources effectively
Stewards leaders create organisational consistency and witness
Steward Leadership (Wilson)
Wilson considers steward leadership through 3 “lenses”
The first is “the lens of ownership” – this focuses the steward leader’s perspective on the rights and purposes of the owner of the resources. “If an organisational leader is viewed as an agent then agency theory assumes he or she is motivated by self-interested opportunism…strong governance structures and incentives need to be imposed by the owner to safeguard their rights. No special relationship or understanding is needed between owner and agent because structure and contract are imposed to ensure proper behaviour. But if the organisational leader is viewed as a steward, then stewardship theory assumes that managers have an intrinsic desire to maximise organisational performance because of a sense of duty, altruism or identification with the owners, the organisation, and the mission.”
Steward Leadership (Wilson)
…the challenge has always been to identify which human stakeholders God is using to speak to us, to discern the degree of implicit ownership that each stakeholder has, and to identify the remaining ownership objectives.
The second is the “lens of motivation” – What motivates a person to be willing to lead as a steward of resources they do not own?
Stewardship theory states that there does not have to be an inherent problem with managerial motivation; managers can have an intrinsic desire to maximise organisational performance because of a sense of duty and identification with the owners, the organisation, or the organisation’s mission.
Wilson cites the work of Lex Donaldson and his colleagues for their work on this model.
Steward Leadership (Wilson)
Stewardship theory demonstrates that steward leaders are motivated more by intrinsic and internal desires and drives (personal growth, self-actualisation, achievement, affiliation) than by external rewards (wealth, authority, title, advancement). Leaders operating under stewardship theory also develop a greater sense of identification with the owners, the organisation and the mission.
Steward leaders are also motivated by collaborative leadership environments instead of individualistic environments. They value the protection that plurality of oversight affords through the collaboration of owner-stakeholder, board of directors, and chief executive.
Steward Leadership (Wilson)
The third lens is “the lens of accountability” – this asks “to whom is the steward leader accountable?” and “for what?”. Wilson uses the following chain of accountability in a non-profit organisation as an example:
Staff members serve as individual stewards and are accountable to the executive director/general manager/CEO
The executive director serves as the understeward and is accountable to the board of directors
The board serves as the chief steward and is accountable to the implicit owners or stakeholders
Everyone is accountable to God
Steward Leadership (Wilson)
Interestingly, Wilson advises against the executive director serving as a “co-steward” with the board since “the ED cannot be both co-steward and accountable to the board at the same time.”
Addressing the second question may be complicated given the reality of multiple owners (both corporations and non-profits), passive owners (shareholders, paid members of a membership organisation) and implicit or moral owners (nonprofit stakeholders). In fact, he argues that non-profit steward leaders have a huge accountability challenge because their “owners” share all 3 characteristics – multiple, passive, implicit.
Steward Leadership (Wilson)
He summarises his view in stating that “the contemporary steward is accountable to accomplish the aspirations, desires, and objectives of the owner or owners….by maximising the efficient use of resources, adding value, multiplying the resources and so on….however many nonprofit leaders are uncomfortable with the risks associated with resource growth and leverage (why?)…but through a close relationship with God and encouragement from stakeholders, steward leaders can experience freedom to responsibly take risks by leveraging resources.”
