Justice Education

Good Work
March 2023

Character in Times of Crisis: Creating Business Leaders in the Wake of the 2008 Financial Crisis

Wes Siscoe

Following the 2008 financial crisis, Professors Mary Crossan, Gerard Seijts, and Jeffrey Gandz at Western University set out to discover what went wrong from a leadership point of view. What caused the financial oversights at so many large corporations that led to the catastrophe? Meeting with over 300 global business leaders, Crossan, Seijts, and Gandz were surprised to find that issues of character may have been at the center of the financial collapse.

“Many identified character weaknesses or defects as being at the epicenter of the build-up in financial-system leverage over the preceding decade, and the subsequent meltdown,” they wrote in Developing Leadership Character. “Conversely, the participants also identified leader character as a key factor that distinguished the companies that survived, or even prospered, during the meltdown from those that failed or were badly damaged.”

If character issues contributed to the financial crisis, though, this raised a whole different problem. Character is rarely the focus of most businesses or business schools, and it wasn’t the driving force behind the training students received at Western’s Ivey Business School. As Crossan, Seijts, and Gandz observed, “Business schools and businesses alike have tended to focus their developmental efforts on competencies, whether on the individual or organizational level.”

In response to this glaring issue, Ivey established the Ian O. Ihnatowycz Institute for Leadership through the support of a generous alumnus who strongly believed in  the power of character. The Institute was charged with developing an approach for thinking about how to educate, not just competent business managers, but leaders of character. After a period of extensive research and consulting with thousands of business leaders in the public, private, and non-profit sectors, the Institute developed the Leader Character Framework, a collection of 11 unique and inter-related dimensions of character that are necessary for developing strong, well-rounded leaders.

“We realized that not only was there a complete lack of character development within business education and higher education more broadly, but also within the leadership discourse in our leadership development programs,” said Kimberley Milani, Director of the Ihnatowycz Institute. “Like other business schools, we were highly competency focused, providing almost no time for reflecting on and developing character. This is problematic not only because it can ultimately contribute to large-scale issues like the financial crisis but also because, on a more individual level, when you see people being fired, it’s usually a character-based problem. It’s not really that they didn’t have the skills to do their job but rather that their judgment was compromised and it created a scandal, a toxic work environment or other significant organizational issue.”

Since its establishment in 2010, the work of the Ihnatowycz Institute has become fundamental to the education students receive at Ivey Business School. According to Milani, “The Leader Character Framework is really foundational for everything we are doing now.” Business students cannot go through Ivey now without having the opportunity to focus on and grow their character – through program events, course content, and elective courses.

Along with developing programs for its own faculty and students, the Institute has also had the opportunity to share its work with business and policy leaders across Canada. From partnerships with the Canada Revenue Agency, the Border Services Agency, and the Armed Forces, the Institute eventually outpaced even its own ability to offer professional development and created  the Leader Character Certification Program to keep up with the increasing demand. The continued interest is driven by the continual need to develop leaders of strong character. Additionally, because character leadership transcends disciplines, this program also serves to advance the understanding of the research underpinnings of character for academics from an array of faculties so they can begin to weave it into their own curriculum.

Faculty at Western University are starting to take notice. Not only has the Institute’s work on character become deeply embedded in the business school, but character education is receiving more attention across campus as well.

“In that first 10 years of the institute, we discovered and elaborated on what those character dimensions of leadership are, why they are important, and – most saliently – that they can be taught and developed. People are not necessarily born with it. Some have more talent than others perhaps, but leader character can be taught and nurtured,” said Ian Ihnatowycz, the Institute’s founder. “I’m most proud of the fact that this knowledge is there and has become part of the fabric of the institute and of the Ivey Business School, building its reputation as the leadership school. Hopefully, it expands to other faculties and Western will become the university that is based on leadership.”