Here is a brief excerpt from an interview of Ann Picard by Rik Kirkland for the McKinsey Quarterly, published by McKinsey & Company. To read the complete article, check out other resources, learn more about the firm, obtain subscription information, and register to receive email alerts, please click here.

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Ann Pickard, the executive vice president, Arctic, at Royal Dutch Shell, built her career in the far-flung corners of the global oil-and-gas industry. In this interview with McKinsey’s Rik Kirkland, she discusses her leadership principles, the impact of listening, and the satisfaction of empowering all employees. An edited transcript of Pickard’s remarks follows.

Distributed leadership

I believe in pushing leadership all the way down, so that every single person is a leader and making choices, and in holding them accountable and responsible for those choices and for delivery of the performance. When I got to Nigeria, after some time I realized we actually had a second-class group of citizens in Shell. And that was an attempt by Shell to do the right thing to get local employment into the right places, but these were people who didn’t have the education or the background, necessarily, to meet Shell’s traditional hiring standards.

But what you ended up with, effectively, was a second class of citizenship in Shell. And once I figured that out, to me it wasn’t the right thing to do. So how do we go about changing it? And this was a large group of people. What became clear to me is that we needed to make some of these people full-time, real Shell employees.

And we went through a long process of talking to people, involving people in the decisions, and testing people. And not lowering Shell’s standards, but broadening Shell’s standards so that if you were really competent at your job, you should be a Shell employee. If you were not, you should not be. And out of that, we ended up with about 400 new Shell employees and a lot more that didn’t become Shell employees and who were let go.

I never had a single complaint from the people that we let go. And on the other hand, to this day, there’s not a week that doesn’t go by that I don’t get an e-mail from somebody saying, “You changed my life.” And those people—today, five years later—are still talking about this, and their loyalty in doing the right thing for Shell is just stronger than ever. I mean, to me, that’s empowered leadership down there.

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Here is a direct link to an edited transcript of the interview, accompanied by a video.

Ann Pickard is executive vice president, Arctic, for Royal Dutch Shell. This interview was conducted by Rik Kirkland, McKinsey Publishing’s senior managing editor, based in McKinsey’s New York office.