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If corrupt behaviour continues, honest people believe they are being taken advantage of, and the weaker ones abandon integrity and begin to look out for themselves dishonestly. Organisational erosion occurs as more and more people join the ranks of marginal cheaters. The self-oriented, careerist model subtly becomes more prevalent and acceptable. The strengths of a once honest organisation languish and those members whose integrity remains intact leave. — Major General Richard C. Schulz

1. Overview

This paper is intended to raise awareness and encourage debate of the responsibilities that we hold as leaders. How (and whether) we step forward and make our views known when we perceive something that conflicts with our inherent sense of justice or fairness.

Every day we make choices that are based on our values; we make those choices based on the constructs that we have built up about ‘right and wrong’ and about ‘good and bad’. In the following paper we unpack the frameworks for ethical choices and decision making in an organisational context. We have also related this to the descriptors in the current tool that we are using to model and assess authentic (ethical) leadership.

Every day we face tension – what we believe is the right thing to do and what pragmatically we have the time and resources to achieve. We are constantly choosing what to champion, what to reluctantly accept and what to challenge. What is this line that gets crossed or this shift in thinking that occurs resulting in us taking a stand and saying no?

At one level, this paper is encouraging the inherent sensitivity to our own moral compass – supporting the development of our intuitive sense of what’s right. At another level, its recognising that in the current complex and changing times, we need to make values-based decision making and keep ethical leadership forefront and mainstream.

Major organisations exist and indeed flourish with only a peripheral focus on the ethics of leadership. The focus is legal and statutory compliance rather than an inherent commitment to ethical decision making. Ask any leader in that organisation whether they are committed to ethical leadership and it is unlikely any will be honest enough to admit they cut corners or put short-term business results ahead of the long-term futures of their staff.

A good leader thinks seriously about both the integrity of management and the management of integrity. — Michael Josephson

Fundamentals of Business Ethics

When we start discussing ethics in business, the first question is from which perspective and whose viewpoint? Is it from the perspective of the academic research, the philosophies of ‘right and wrong’ or the regulatory framework of compliance and best practice frameworks?

“Ethical leadership is leadership that is directed by respect for ethical beliefs and values and for the dignity and rights of others. It is concerned with the kinds of values and morals an individual or a society finds desirable or appropriate. Furthermore, ethics is concerned with the virtuousness of individuals and their motives” …. Wikipedia

Ethics is often confused with morality. If we believe that ethics applies even when others are not involved, then perhaps we can frame it as:

  • Morality is the state of virtue*
  • Ethics is the operating code that enables morality
  • Ethics is the rational basis for morality, providing valid reasons that something is ‘good’

* A virtue is sometimes defined as a trait or quality that is deemed to be morally good and thus is valued as a foundation of principle and good moral being.

Johnson (2001) also put forward the proposal that ethics is in fact two things:

  • The ability to discern right from wrong
  • The commitment to do what is good and proper

Moorehouse (2002) considered two perspectives – characteristics and traits. He suggested that ethical leaders showed the characteristics of integrity and the trait of leading by example. In practice our ethical behaviours will play out in both our public and our private lives. A useful perspective may be:

Obligatory behaviours – ‘it’s the right thing to do here’; it would be wrong not to take this action.
Impermissible behaviours – ‘this is wrong’; we can’t’ go ahead with this course of action.
Supererogatory behaviours – ‘going above and beyond’; it would be right to do this (but not necessarily wrong not to do it). No obligation but going that extra mile.

As a leader in an organisation what guides our individual moral compass? When does acceptance that things could be done better become explicit collusion with maintaining the dubious status quo? More to the point, can we afford the moral high ground of always ‘doing the right thing’ in these current turbulent and ambiguous times?

2. Practical Applications

Perhaps a place to start is to consider how ethical leadership actually plays out in the workplace:

  • For an individual fulfilling a role within an organisation
  • For a leader with positional power within that organisation
  • For an employee of an organisation interacting with customers and the wider community
  • For a member of society impacted by the corporate behaviours of whole organisations

The challenge is that from many perspectives, ethics and ethical decision making may not be absolute. It may be related to the individual context and the question of whether we are talking about the right decision for the individual or for the organisation as a whole i.e. looking at the bigger picture. Take redundancies as an example; at its most basic taking away people’s livelihoods to make a company more efficient, sell more widgets and pay out increased dividends to shareholders. The free market economy in action most certainly.

So, where does ethical decision-making lie in the overall leadership portfolio – is making the call to cut jobs fulfilling the psychological (and commercial) contract that the CEO entered into when they took the job? Is it subsequently ensuring that the cuts are made compassionately and with support for the individual in question? And how much support is enough – why pay more than the statutory minimum redundancy as it may put pressure on the resources available to the stayers; the leavers are going anyway so who do we give priority to?

We need a basis for making these decisions – even if only to justify them to ourselves and ensure we sleep at night.

Decision-making Frameworks

How do we navigate our way through ethical decision making? Let’s take a step back and try to put a framework around ethics; there are three main theories:

a) Consequential Ethics
b) Non-consequential Ethics (Duty Based)
c) Agent centred Ethics (Virtue Based)

a) The Consequential Perspective:

Achieving the greatest good/doing the least harm. Characterised by Rousseau as achieving the best for people as a whole. Understanding the networked aspects of society; emphasising respect and compassion for others, especially those most vulnerable. Consideration – the future effects of possible courses of action, who is directly or indirectly affected by what we are proposing to do. On balance, are we achieving the greatest good for the largest number?

b) The Duty Based Perspective:

According to Kant, characterised by a focus not on the consequences (over which ultimately, we have no control) but the intent we held when performing the action. According to Locke, the best ethical action is that which protects the ethical rights of those impacted – the belief that all humans have a right to dignity. Consideration – when we embark on this, have we ensured an even handed and equitable approach that respects the views and interests of all those impacted.

c) The Virtue Based Perspective:

Ethical actions are those consistent with the ideal human virtues. Characterised by Aristotle who believed ethics related to the whole of a person’s life and not just individual actions that may be taken in a particular situation. Basically, the epitomisation of ‘good character’ and emphasising the importance of the role model. Consideration – our experiences, emotions and thoughts have developed our character – are we being true to those values that we hold most dear?
This has been summarised by Bond and Firenze in their 2013 summary of a seminar on ethics as:

3. Applying Ethics in the Workplace

Sometimes it’s useful to have a process to follow. Also extracted from the Bond and Firenze 2013 seminar, here is a suggested path:

I. Recognise it’s an ethical issue – We work at pace, under pressure and with insufficient resources, often this is exacerbated by conflicting and shifting priorities. There is a need for a time out switch – something that says, ‘hang on a minute let’s stop and think this through’.

II. Consider all parties who are involved and may be affected – Whichever of the ethical perspectives that may be relevant; the potential outcomes, the pending actions or the underpinning values. Reflect on who and how how may be impacted now and in the future and the possible consequences for them.

III. Gather information – What (else) do I know or need to know to make an informed decision? Have I considered all the various perspectives, is there existing data or research I could use? What guidelines, codes of practice or statutory requirements may apply?

IV. Formulate actions/consider alternatives – What appears to be the best course of action to take? What else may be possible, what are the risks, benefits and consequences of the proposal – do I need a contingency plan in place?

V. Make a decision/review the decision – Whatever decision-making process or framework you would normally use, consider getting another view/perspective. Who else could you check in with or ask to review the decision prior to implementation? Not just from the perspective of establishing an audit trail; an input from those impacted demonstrates genuine commitment and concern.

VI. Act – At some stage action is required. Consider how, when and where this needs to be communicated. Consistency of message and of application are critical to success. Consider the resource requirements and ensure it is not added to someone’s already overloaded in tray.

VII. Reflect on the outcome – As part of the design stage, you will have considered what good looks like in terms of effectiveness of outcome. Reflective practice is a key component of any leader’s toolkit, evaluating what worked and what might need to change both as an individual and as a team is an integral part of the overall process.

4. Summary

We’ve tried to summarise and present a balanced and practical view from a practitioner’s perspective. Are there certain traits and characteristics that typify ethical leaders – and is there a framework that will help to identify and develop these traits? Have a look at the creative characteristics in The Leadership Circle Profile (TLCP)™ framework – particularly the authenticity dimension:

‘Your inner and outer lives are congruent. Your behaviour matches your values and others trust that you can be counted on to keep your word, meet your commitments, deal with them honestly and fairly, and remain true to your purpose.
Authenticity and integrity are the qualities most desired in a leader, so scoring high on Authenticity suggests that you are perceived as a leader, and that others will follow. They will align with you because you practise what you preach. Your power in the organisation is not primarily based on where you are in the hierarchy (position power), nor does being indirectly political attain it. Your power is given to you by others because you act with integrity’ – Extract from TLCP Manual, descriptors of the Authenticity dimension.

The nobler sort of man . . . is anxious to see clearly, to hear distinctly, to be kindly, respectful in demeanour, conscientious in speech, earnest in affairs. When in doubt, he is careful to inquire; when in anger, he thinks of the consequences; when offered an opportunity for gain, he thinks only of his duty. – Confucius


The suggested framework for thinking ethically is based on the output from the seminar “Making Choices: Ethical Decisions at the Frontier of Global Science” held at Brown University 2011. Primary contributors – Sheila Bonde and Paul Firenze

Andrew is an Ethical Leadership specialist. Andrew has a particular focus on public facing, high risk, high scrutiny environments. He works alongside senior leaders on ethical decision making to achieve a triple bottom line between people, plant and profit.