We spoke with Nils Seebach about #FutureGoodGovernance.
The interview was conducted before the outbreak of the Corona Pandemic.
A ship needs a captain. There is much talk about new leadership concepts, about participation and freedom. How much leadership does a company need in the future and how much agility can it tolerate? How do you envisage corporate management in the future?
In my opinion, leadership and agility are not contradictory, but belong together. Modern leadership is based on trust and the ability to give others as much freedom as possible. In order for this to work, it requires guidelines or a framework within which employees can move freely. This in turn enables agility. It is therefore important for managers to define guard rails and to constantly question and adjust them. In addition, committees must ensure that employees can work as independently and self-organizingly as possible.
The world’s Greetas have also drawn attention to companies and their fields of action. What challenges do you expect in terms of social responsibility and thus sustainability in the company?
We must not forget: It was children and young adults who made the world aware that climate change requires our action. And they are right! But those responsible in politics and business should have taken action much earlier, because sustainability is – ideally – one of the core elements of both political and corporate action. The ecological dimension of sustainability must be integrated into corporate activities beyond CSR measures. Neither customers nor qualified employees will tolerate contradictory actions for much longer – and managers should not either, in view of their responsibilities. I make no exception in my own case.
Trust is good, control is better. Today, it is still primarily about numbers and compliance. However, artificial intelligence is also changing perspectives and thinking. How can you imagine a future system for monitoring the Executive Board? Will there still be a supervisory board watching over the management or will the ‘monitoring’ be replaced by a technically highly equipped external service provider?
Supervisory boards are obliged to fulfil their control function by monitoring and analysing KPIs. This can also be done through automated tests. In my opinion, it is much more important in this case that the supervisory board asks the right questions and penetrates the KPIs accurately. Every board member today should know what is behind the CLV (customer lifetime value) or the CPA (costs per acquisition) in order to really understand the business – which is increasingly being done digitally and online. In case of doubt, a tour of the production facilities is not enough, but also direct discussions with sales and marketing managers. How and by whom the data to be interpreted is then collected and analysed is of secondary importance. In this case, it can certainly make sense to use a technical service provider. However, the work of a technical service provider does not relieve a supervisory board of the obligation to understand operational KPIs and to be active itself.
Companies are subject to a constant process of change. What challenges do you expect for your company in the next 10 years? How will they change your company? What will change for the employment and qualification of your employees?
We have been talking about it for 10 years and will continue to do so in 10 years: digitalization. I won’t go into what will be important for the employees in this process here. What is much more important is that digitization must be wanted and driven “from above”. If digital work is only carried out department by department, a company will not get anywhere. But if the management bodies and the stakeholders and shareholders make digitization their issue, then something really happens. First and foremost, it is necessary for supervisory and management boards to acquire new knowledge and skills – and I don’t mean the trip to Silicon Valley, which has become so popular. Real knowledge transfer in the field of digitization already happens in simple dialog with young employees on site. It’s not for nothing that they say, “Why go far away…”
There is much debate about centrality vs. decentralisation, agility and core competence in organisations. Will there still be companies in today’s sense of the term in 20 years’ time? What changes in terms of corporate organization and financing do you expect or would you like to see?
Companies will always exist. With all the developments to make working hours and locations more flexible, in the end it is still the result that counts. This will not change
Car manufacturers are becoming mobility service providers, food producers are becoming lifestyle providers, media houses are becoming data science companies. Where will your industry develop into? Will industries – as we know them today – still exist in ten years’ time? What will happen then?
As I said before: apart from Corona, digitization will be the dominant topic. It is everywhere, it stops at no industry. The changes are only so significant that the boundaries are becoming more blurred – keyword platform economy. An e-commerce provider can offer car sharing or digital health services tomorrow. This increases the need for interdisciplinary thinking and new types of transfer services, which places enormous demands not least on supervisory and management boards. It is therefore essential to always “keep an ear to the ground” and to enable the right people in the company to act with foresight – despite or perhaps because of all the imponderables.
The so-called stakeholders, in particular the (institutional) shareholders, are exercising their ownership rights and duties much more than just a few years ago. It is therefore no longer enough to tick off the requirements of a code (“comply-or-explain”). Internationally, the intensive and permanent communication/interaction of stakeholders with corporate management is gaining ground (“apply-and-explain”). What trends do you see here and how do you assess them?
Communication and transparency are becoming increasingly important, simply because digitalization demands it. This is precisely where I see the management team as having a duty to provide more insight – the keyword here is CEO communication. Digital solutions and channels open up completely new possibilities. The potential just needs to be exploited: Which DAX board member regularly makes a podcast for employees and investors? Who writes articles on LinkedIn or posts on Instagram?
#FutureGoodGovernance is currently still comparable to a crystal ball in many areas. Which future aspects of good governance are particularly important to you? What would you wish for if you had three wishes? Where do you see the political challenge? And what responsibilities will companies and their managers have in the future?
Following my answer to the last question: Transparency is the be-all and end-all of modern management. Accordingly, I would like to see reporting obligations to the public extended – all within the framework of compliance, of course. Modern communication channels are needed to create transparency. It would be desirable to digitize communication both within the committees and with stakeholders as far as possible. In the end, however, it is not the use of paper or iPad that decides whether, for example, a supervisory board does a good job; it is the results, made possible by the right intentions. This brings me back to the beginning of the discussion: Good governance has sustainability in all its dimensions as its core concern.
Thank you very much for the interview!