Another Nail in the Leadership Ethics Coffin?

Ethical Choices

Once again the personal ethics of a national leader is brought into question.

Leaders are legendary for moral lapses and Anthony Weiner is latest in a long line of those who have slid down that slippery slope of moral mis-management.

Rolling Down Hill

Disgraced LeaderWhat needs to be remembered by all leaders is the impact that moral indiscretions can have on an organization’s day-to-day practice; they can affect every attitude and action.

Ethics influences the value shown to each person, whether employee or customer, by how they are treated, as well as, the products which will be produced and promoted.

The ethics of an organization should be pervasive.

Earning Trust

Charles O. Holliday, Jr. chairperson and CEO of Dupont Co. put it this way:

“Just saying you’re ethical isn’t very useful, you have to earn trust by what you do every day.”

What he is saying is that it is in the day-to-day practice of a leader, their organization, and its members, that it becomes clear whether they are truly ethical.

Not only is it important to intend to practice ethics, but organizations must set up “ethical safeguards” to see it happens.

In support of this need one set of researchers (Embse, Desai and Desai) wrote,

“…this study supports and extends previous observations that simply having ethical codes and policies does not guarantee ethical practices throughout the organization.

To become a genuinely ethical organization – an important success factor in today’s environment – a comprehensive approach and investment in ethical safeguards is needed and should be regarded as a dimension of decision making alongside quality standards, performance, profitability and other strategic considerations.”

Long Term Interests

Stuart Gilman emphasizes the urgency and importance of this practice, the president of the Ethics Resource Center in Washington DC says:

“Ethical business practices used to be linked to the corporation’s long-term best interests, contrasted against devious practices that often brought short-term gain. Ironically, in the current environment, ethics is now about the short-term.

The current market will not be fooled. Recommitting an organization to ethics cannot simply be a PR campaign.

An active commitment to ethical behavior – from the top down – will be the best safeguard against corruption – and ultimately the only thing that will fully restore investor confidence.”

We live in world that is often suspect of the ethics of leaders and organizations. It is the responsibility of the organization and its members to earn the trust of the world around them through ethical behavior.

Proper Values

Curtis C. Verschoor, the Ledger & Quill Research Professor at DePaul’s School of Accountancy in Chicago, who has done extensive research on ethics in organizations says this:

“An emphasis on proper values deals with setting examples, interpreting ethical principles and structuring appropriate reward systems. Ethical culture spreads from clear and unequivocal goal setting at the top and openness throughout the organization.”

He affirms that whether through areas of organizational personnel, purposes, or practices, the issue of ethics is pervasive in entering into the launching and leading of organizations into the 21st century. A topic that is essential for organizations and their leaders to understand and address within their personal lives and leadership positions.

“Studies have found…that there is a small positive relationship between ethical and socially responsible behavior and financial results.”

Bottom-Line Reasoning

That is to say, research demonstrates there is some financial incentive for organizations to act ethically. Beyond financial reasons, it builds social capital with both employees and customers.

Of employees, Daft says this:

“Researchers have found that people prefer to work for companies that demonstrate a high level of ethics and social responsibility, so these companies can retract and retain high-quality employees.”

As for customers, one study by Walker Research indicated “price and quality being equal, two-thirds of people say they would switch brands to do business with a company that makes a high commitment to ethics.”

A Challenge and Warning

Finally, he says, by way of challenge and warning:

“Top leaders are responsible for creating and sustaining a culture that emphasizes the importance of ethical behavior for all employees every day.”

It is a call to leaders to lead in an area where the pressures of producing and the coaxing of contingency might make it easy to start the slide down the slippery slope of compromise of ethical standards.

This slide can lead to a fall that O’Toole warns of from his own experience when he writes:

“…business people are more comfortable with the philosophy of leadership rooted in expediency than with one rooted in morality.”

Which will be the legacy of your leadership and that of your organization? What is your organization doing to structure and sustain a high ethical standard? Who at your organization is presently on the right track and who might be on the wrong track?

Dr. Lorin Staats
has provided leadership in the Jian Hua Foundation, Yunnan, China.

His serves in leadership and vision identification & development in the US and abroad
Email | LinkedIn 

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L2L Contributing Author


  1. larry weeks on June 30, 2011 at 12:37 am

    the area of Ethics is much maligned and misunderstood. But it is taught and taught well, and it is taught in only one place.
    Scientology has been using that technology for 60 years and it has stood the test of time in fact their very existence is because of it.
    Why don’t our business men use this technology?
    The answer is easy ….vested interests which don’t usually include the rest of us.

    • Lorin Staatstaats on July 5, 2011 at 1:00 pm


      Thanks for the feedback. The teaching of ethics has a long history that includes a rich heritage in the teaching of the Bible, maybe best summarized in The Ten Commandments. Joas (2000) in “The genesis of values”, provides a helpful historical review. Also see Guinness, (2000) “When no one sees: The importance of character in an age of image.” for a strong case for the biblical source of ethics.

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