What is authentic leadership and how can it help business?

Any effective leadership development programme will emphasise and consider a wide variety of leadership styles. To be at your most effective as a leader, you need to find the one that best suits you and your character. There is one approach to leadership that takes this into account, offers numerous business advantages and is growing in popularity, especially given the millennial-dominated workforce. This approach is known as authentic leadership.

Authentic leadership has been praised for its ability to build a diverse workforce. Authentic leadership has roots in Greek philosophy, specifically the ancient Greek model of cardinal virtues, comprising of prudence, temperance, justice and fortitude. Today, authentic leadership means that leaders prioritise straightforwardness and honesty, while shirking the old-fashioned assumption that leadership requires acting, or a portrayal of a completely different personality while at the office.

Leadership authenticity is the ability to be self-aware, transparent and balanced, while acting in line with your own morals, principles and limitations. Ultimately, this influences the way employees think, behave and feel about their work. It has been shown time and again that authentic leadership is something that motivates millennials, but what are the exact benefits offered by this approach to leadership? And why should you consider employing it?

Authentic leadership inspires employees

An important part of leadership is inspiring, uniting and motivating your employees or co-workers to excel. Authentic leadership helps in this respect by making leadership look attainable and realistic. Doing away with any pretence that leaders are perfect, strong and unaffected by pressure will help employees to realise that they, too, can advance while staying true to their values.

In an age where so much appears superficial, a lot of people are craving authenticity, especially in leadership. According to the Harvard Business Review, 75% of employees want to experience more authenticity at work. In order to inspire your employees, they need to know you, they need to respect you and they need to be aware that you are living in line with your own values.

Authentic leadership drives trust

We all know how important trust is in the workplace; this is particularly true in difficult times, or during periods of organisational change. Authentic leaders are easier to connect with, more approachable and more trustworthy. When authentic leaders create a trusting environment, they allow employees to be themselves, which boosts productivity by as much as 30%.

On top of this, authentic leaders evoke more trust in their employees as they are more open to differing viewpoints and opinions. This means that employees will be far more willing to open up and contribute to a situation, rather than assuming their opinion is not needed or wanted.

Trust can be a difficult thing to earn nowadays. Employee trust in authority decreases as you ascend the hierarchy. Evidence suggest this is because the C-suite isn’t exhibiting ethical behaviour; we can see from a survey showing that while 50% of employees want their CEO to demonstrate highly ethical behaviour, only 24% believe their CEO to be exhibiting such behaviour. The same study concludes that employees want to know and understand their CEOs on a personal level, including what morals drive them. Another source reiterates that employees generally don’t trust leadership, because they believe them to be less than transparent.

Leaders should remember that the strict, authoritarian approach to leadership is dying out, and command-and-control systems evokes a huge mistrust. Create a company culture that is authentic and honest, and trust will naturally improve as a result.

Authentic leadership can boost employee engagement

There have been a number of articles on the topic of employee engagement, what it is and how we can improve engagement levels within our company. Authentic leadership can help in this regard by giving people increased freedom and flexibility, while giving them room to grow and develop. On top of this, employees will naturally be more engaged with an organisation if they believe they are familiar with the ethos of the company, the direction it is moving in and the importance of their role within it.

We have known for a long time that managers have a huge impact on employee engagement. Increasingly, it is clear that authentic leadership can improve engagement levels. This was demonstrated in a 2016 study, which confirmed authentic leadership significantly increases employee engagement and organisational citizenship behaviour.

Authentic leadership upholds ethical and moral standards

Company culture has a large impact on the ethical decisions made by employees. When immoral business decisions are regularly made, this can feed back into company culture, creating a vicious cycle. Of course, ethics and morals are important to a company for a number of reasons. Ethical standards can increase retention, boost productivity and attract top future talent.

According to one source, authentic leadership tends to guarantee high ethical and moral standards. This is because when the importance of ethical behaviour is emphasised by leadership, the organisation as a whole has a “stronger ethical footing”. Employees begin to act in a way they realise is appreciated and encouraged by the company.

Like any organisational change, incorporating authenticity as a leadership approach might take time and serious effort. But when you look at the benefits you stand to receive, it is certainly worth making small, but significant changes towards a more honest, open and authentic workplace.

Nick Davis is a Director at Davis Associates. He has a particular interest in organisational change, leadership development and company culture.