So, what’s going to be the big emergent theme at Cannes this year? We’ve seen how the digital age of transparency has resulted in marketers and agency leaders jumping on the brand purpose bandwagon. And there’s no doubt that brand purpose will still feature heavily this year at Cannes.
However, a sea change is underway, and I expect us to see content in the Palais that’s going to focus our minds on how the corporations that own these brands create social value. I’m certainly expecting Angela Ahrendts’ showcase on the journey Apple Retail is on to enrich peoples’ lives to hone in on this. She represents a new breed of leader who can articulate the relationship between the creation of economic value and social value in business. I believe that this change will have profound implications for what business leaders need to deliver and how they will be judged.
We all know that the creative industries are, like every other business segment, experiencing rapid change driven by the impact of technology and digital disruption. Indeed, every leadership job description that I have handled in the last couple of years has had business transformation at the top of the to-do list. The need for business transformation has created new and well-documented challenges for what leadership is. Skills like vision, agility, collaboration, thinking on your feet, embracing the unknown and managing complexity have never been more important.
And as the pace and complexity of change increases, the resilience of those leaders is becoming the difference between success and failure. A leader’s ability to cope with and rise to the inevitable challenges, problems and setbacks inherent in business transformation. Often they come back even stronger, which may well seal the fate of many organizations. Agility and resilience will increasingly become defining traits of great leadership.
But a new dynamic is emerging. This is not driven by technology itself, but by the impact technology is having on our personal and professional lives. Discussions around the behavior of some of the big technology-driven corporations have highlighted privacy issues, teenage mental health, the quality of political discourse, social inequality and environmental concerns, a far-ranging set of problems. As a result, the value of every business is being questioned beyond simple economic value (revenue and profit).
Increasingly, questions are being asked about what businesses are contributing to the societies they operate in over and above economic value. This certainly came into sharp focus during Mark Zuckerberg’s testimony to Congress. What social value are they creating? What social purpose do they have?
This is why integrated reporting—how a company represents itself through financial and other value-relevant information—is growing rapidly.
Financial analysts now recognize the relationship between social impact and financial performance. BlackRock CEO Larry Fink recently issued letters to 1,000 CEOs asking their companies to make a positive contribution to society in equal measure to financial performance.
The increased scrutiny on the creation of social value and the crystallization of the link between economic value and social value in delivering sustainable growth will have a profound impact on the qualities and skills required in the next generation of business leaders. This will apply to both brand owners and their agency partners. Moving forward, I expect that job descriptions for leadership roles across all disciplines will explicitly set out organizations’ social value objectives, and leadership candidates will need to convince potential employers that they are able to deliver against these.
It is now widely accepted that diversity fuels innovation and creativity, driving business transformation and commercial success. The connection between creating social value and economic value in order to deliver sustainable commercial success will further underline the importance of diverse leadership teams and promoting a corporate culture that embraces diversity. You can’t drive the creation of social value without diversity.
The assessment of business leaders who are fueled by innovation and creativity has always been more nuanced than just looking at top-line and bottom-line performance metrics. But the burgeoning focus on the creation of social value and its relationship with the creation of economic value will have a profound impact on the skills and qualities required in a successful business leader moving forward.
For all the talk about how Cannes is in the midst of changing, the turn from individual and team achievement to recognizing the value they do for the betterment of the world around them might be most important. We won’t see much of it this year, besides what’s discussed onstage. But change is coming, rest assured.