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John Baldoni
Leadership author

John Baldoni

John Baldoni is a leadership consultant, coach, and regular contributor to the Harvard Business Review online. His most recent book is Lead Your Boss: The Subtle Art of Managing Up.

Craigslist changed policy, not principles

Q: In defending Craigslist against charges that it facilitates prostitution and casual sex and undermines the news business, founder Craig Newmark relies on an unwavering commitment to free expression, free markets and an open Internet. Is such an unwavering commitment to core principles the essence of leadership, or is leadership more about accommodating core principles to other social needs and values?

"To bend or not to bend?"

With apologies to Kenneth Adelman who writes so insightfully about the Bard's influence on leadership, that is a question that every leader faces when it comes to taking sides. Of course every leader wants to stand on principle as well as she should but before taking such a stand it is important to define what it meant by principle and separate it from policy.

Principles are the core values that shape a leader's outlook and frame the purpose of the organization in which he or she leads. Such core values may include honesty, integrity and respect for human dignity. By contrast, policies are practices that a leader and the organization follows. They may be rooted, and often are, in core values but they are not the same. Principles, because they are central to belief, should not be altered; policies can be changed due to circumstance.

This is the case with Craigslist. Its policies put a premium on free expression. That is fine, but when it has been shown that some users of Craigslist have abused that privilege and using it to purvey and procure sex services, management is within its rights to change the policy. It can put limits on free expression because it is proving harmful to the greater good of the company and its patrons.

The principles versus policy debate is akin to the confusion that many (especially those of us like me who are statistically challenged) share when it comes to causation versus correlation. For example, a survey may show that blue-eyed children do well in first grade. However it is a stretch to say that having blue eyes is an indication of superior intellect. There may be a correlation between blue eyes and good grades but it would be false to claim that blue eyes by themselves produce good grades.

Understanding the difference between causation and correlation is the same as differentiating principle versus policy. The former are inviolate; the latter can change as circumstances do. Changing with circumstances is not a sign of wishy-washiness; it's a sign of intelligence.

Case in point. It may be policy to reward senior leaders with bonuses pegged to corporate performance, even when the company suffers loses. Principles would tell you that being rewarded for fiscal failure is wrong-headed. Yet at the 2008 we saw a great many executives in the financial sector reap big bonuses despite corporate losses. This was an example of policy trumping principle.

At the same time we saw examples of corporate officers forgoing bonuses (and in some cases compensation) until their companies recovered. Some executives also took voluntary pay cuts in solidarity with employees who were asked to do the same. This was an instance of principle trumping policy.

A leader's responsibility is to do right by the people he or she leads. Holding to values and principles is a matter of integrity. Changing policy to help the organization address changing times and therefore be better positioned to serve in the future is a good thing.

By John Baldoni

 |  September 7, 2010; 12:17 PM ET
Category:  CEOs , Corporate leadership , Ethics Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   Del.icio.us   StumbleUpon   Technorati  
Previous: Adopting principles for profit is weak leadership | Next: Tactical flexibility, Reagan-style

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