What Is Ethical Leadership?

Ethical leadership expands much farther than simply increasing production and profits for an organization. Applying ethics to leadership and management styles involves considering ethics when making decisions and setting boundaries within an organization as well as when developing ideas. Making decisions based on the core values of an individual or a code of ethics set by an organization as a whole ultimately inspires employees to do the same, creating a productive and positive environment. Choosing to follow an ethical path will create a positive experience for everyone involved in an organization and also improve the functioning of the business. The following information describes what it means to be an ethical leader:

Setting Up a System of Conscience

The path to ethical leadership is marked by a loyal dedication to following a moral code. However, it’s possible for individuals to feel unsure when it comes to figuring out the practical solutions for implementing that code. Defining a system, and committing to preserving, it sets true ethical leadership apart from other leadership strategies, as sound ethics enhance management capabilities and results.

Identifying an Ethical Course of Action

Organizations that endorse ethical leadership should have an established policy that states explicitly what actions are acceptable. Possessing a strong moral corporate character isn’t enough to inspire leaders to act ethically; these methods must be put into practice and well outlined. Of the “4 V’s” laid out by the Center for Ethical Leadership (values, vision, voice, and virtue), “values” come from having a solid policy in place. A roadmap will ensure that these ideals are upheld no matter what circumstances individuals encounter as part of the organization.

Encouraging a Conscientious Environment

All staff members in leadership positions need to be aware of what is expected of them. Ethical leadership involves holding regular meetings to ensure that everyone is on the same page as well as dealing with conflicting issues that arise in a timely manner. There are many benefits to incorporating an ethics code of conduct including: improved communications across the organization’s staff, establishing confidence, fairness and stronger customer relationships.

Making Difficult Choices

Defining a structure and ensuring that staff members follow the code of ethics can take effort, but the real work of maintaining ethical leadership in the workplace comes down to the choices individuals in management and leadership positions make when faced with conflicting values.

Balancing Ethical Leadership with Financial Concerns

Organizations may face difficulties in maintaining ethical practices while still making sure the business runs efficiently and smoothly. Following ethical practices can be more time consuming, and stressful, than letting those practices slide. For example, ethical leadership necessitates transparency in the workplace; when something goes wrong, it might be hard not share information with employees, customers or shareholders. It’s often easier to do things in a way that jeopardizes conscience. It can be an ongoing struggle for management to uphold values in the face of financial, or other, stress. The benefit of divulging this type of information to staff members is that by keeping an organization aware of any potential internal problems, a sense of cohesiveness and open communication is created. In addition, transparency within the organization opens up the possibility to gain insight into a solution that may not have been possible if only a select number of staff is aware.

Upholding Ethical Leadership in the Face of Pressure

If a subordinate employee is not following ethical practices (as laid forth in the policy documentation), it can be easier to hold meetings to reinforce the importance of these practices to communicate issues that need fixing directly than it might be with a supervisor. In the situation where an employee has observed a superior not following the code of ethics, that employee may need to take steps outside of their normal chain of command to rectify the situation or seek external assistance with the problem.

Leading By Example

Only by truly embracing the principles of ethical leadership can supervisors ensure that best practices are upheld throughout the organization.

Developing Your Own Moral Sense

Developing an understanding of how to best craft an ethical system of leadership, uphold those methods, and make difficult choices when the opportunity arises is essential in becoming a successful, ethical leader. Not only will you need the knowledge to do what’s right, but also the confidence and the credentials to convince others of the correct path.

Consistency in Execution

Just as it’s important for a company to be consistent in explaining and encouraging ethical behavior, it’s also essential for a leader to showcase an unwavering dedication to moral principles. An ethical leader must always consider his or her actions in the context of the greater scheme of the good of the business and behave accordingly.

Along with emphasizing ethical business practices, The University of Saint Mary Online teaches critical thinking, and encourages students to consider how decisions affect their colleagues and their company's place in the world of global business. For those interested in pursuing an online MBA degree, the school is grounded in the liberal arts tradition of providing students with the strong leadership, decision-making and critical thinking skills required to thrive in the workplace.

Back to Resource Center