The Institutions Within: A Reflection on Systems, Leadership, and the Long Game

It’s easy to think that the institutions governing nations and economies operate on a different plane from the systems we construct in our day-to-day lives. But as I reflect on the The Nobel Prize 2024 Sveriges Riksbank Prize in Economic Sciences, awarded to Daron Acemoglu, Simon Johnson, and James A. Robinson for their work on political and economic institutions, I can’t help but notice the striking parallels between their findings and the dynamics I see in executive leadership and personal growth.

Their research shows that nations rise or fall based not just on their resources or even their culture, but on the architecture of their institutions. Inclusive institutions, the kind that empower a broad base of people, protect property rights, and encourage innovation, create the conditions where prosperity is not only possible but sustainable. On the other hand, extractive institutions, those designed to benefit a narrow elite at the expense of the broader population, lead to stagnation, inefficiency, and eventual decline. It’s a story we’ve seen play out across history, from the colonial divide between North and Latin America to the modern challenges of democratization and development.

Now, let’s pivot. What if, in our professional lives and personal journeys, we are constantly building our own institutions? Not formal bureaucracies, of course, but the internal systems, our habits, values, and frameworks for decision-making that govern how we navigate the world. The metaphor works, doesn’t it? We either build inclusive systems within ourselves that encourage learning, growth, and adaptation, or we fall into the trap of extractive behaviors, chasing short-term gains while undermining our long-term potential.

In the boardrooms where I coach executives, I see the same dynamic play out on an organizational scale. Teams and leaders succeed when they foster inclusive environments where ideas circulate freely, talents are nurtured, and growth is not a zero-sum game. Conversely, I’ve seen leaders who, consciously or unconsciously, create extractive environments, hoarding authority, undermining collaboration, and in the process, stunting the potential of their own organizations. These leaders, like the autocrats of history, might achieve short-term gains, but the long-term costs are inevitable.

The same applies to personal development. Think of your own life as an ongoing experiment in institutional design. You can create routines and systems that encourage deep work, resilience, and curiosity—an internal version of those inclusive institutions that drive economic prosperity. Or you can let yourself fall into extractive habits—those dopamine-chasing distractions that provide momentary pleasure at the cost of your broader aspirations.

What Acemoglu, Johnson, and Robinson have shown us is that inclusive institutions are the hidden drivers of the long game. And in leadership and indeed in life playing the long game is everything. It’s not just about making decisions that get us through the next quarter or the next crisis. It’s about building structures that will still be standing stronger, even decades from now.

We’re all architects of our own institutions, whether we acknowledge it or not. We lay that cornerstone and build on it. The question is: What kind of system are you building? One that lifts you and those around you to new heights or one that slowly drains the vitality from its own foundation?

The future of your leadership, your organization, and perhaps even your life depends on the answer.