What are we to make of Australian election results that served up no winner?
It is regrettable that the voting public did not deliver a clear-cut verdict in the Australian election results on 2 July, says Lyn Goodear, CEO of AHRI. “A decisive vote would have broken the cycle of uncertainty and discontinuity that accompanies the leadership malaise which has been a feature of our political landscape over much of the past decade,” says Goodear.
“Whether leading a business or a nation, leaders need to communicate a vision with clarity of purpose. It needs to be founded on an underlying truth that enables a commonality of spirit among the people they are leading.”
The inconclusive outcome of the election has put both Liberal and Labor leaders under scrutiny with questions raised about their ability to win over people’s hearts and minds. But it also highlights what an unsettling time it is when there is a power vacuum. For businesses, one of the most dangerous periods is when there is a handover of power, when the known becomes the unknown.
You don’t have to search far to see how this has played out, particularly when a leader is so closely associated with a brand. When Steve Jobs, in declining health, handed over the top job to Tim Cook, many doubted that anyone could take the place of the man seen as synonymous with Apple. Yet, despite, criticism that Cook lacks Jobs’ vision and inspiration, Apple has enjoyed profit growth of 40 per cent since the handover.
The high price of being leader-less
Not all transitions are so successful – or planned for. Late last year, PricewaterhouseCoopers reported that Australian shareholders lost $8bn from unplanned CEO turnover. The loss in value is accounted for in the run-up to the unplanned CEO turnover as well as the year after the change. Compared to a global average of 86 per cent of planned CEO successions, in Australia the figure was 77 per cent.
The number of years that CEOs remain in office also tends to lag behind global averages with ASX200 CEO tenure up to five years, up 15 per cent from 2013.
It’s not only nature that abhors a vacuum – as Aristotle reflected – so does leadership, be that in business or politics.
Restoring certainty and establishing decisive leadership must be a priority now following the Australian election results, says Lyn Goodear.
“For the good of this great nation, we can only hope that our political leaders are able to find a way to muster sufficient goodwill to bring about a workable government that unites rather than divides,” she says.
“Under the circumstances, that is a big challenge in a political system which is typically unrelenting in the way it conducts the contest between competing party interests. But it is a challenge we need our leaders to rise to.”