Category Archives: Leadership ethics

Ethical Leadership – A Must For Customer Loyalty

Businesses still do not understand that customer loyalty begins with executive leadership who demonstrates consistent ethics and values found within the organization’s strategic business action plan. When the executive leadership behaves badly, these actions are shared inside and outside of the organization.

For example, Indiana is an at will employer. Businesses can terminate employees without any notification. Yet most of these same firms expect 2 weeks notice when employees leave. Now does this attitude or belief demonstrate high ethics and values; or is there a thread of hypocrisy running through these organizations?

With the tightening of the global market place (and yes it is global even if you believe all your business is local), many organizations are cutting back on employees from downsizing to outright terminations. Usually what this means for mid-size to larger organizations is the slashing of the Education and Training Departments’ budgets as well as personnel.

Why is this area usually is the first to go is because of these two continued beliefs within the American business culture:

  • Education is not really valued.
  • The inherent value of human capital is not really understood by many American companies
  • In business, there exists what I have labeled the Osmosis Learning Belief. Stand next to someone and you instantly become a great leader or a super star goal achiever. Employees need to be developed where they demonstrate ethical leadership. They require assistance in developing their talents and further strengthening them so that the organization becomes even more competitive.

    American companies and organizations with the exception of a few such as Southwest Airlines do not value human capital. Many employees especially below the executive level are viewed as “throw aways” for the belief is that the firm can always find someone cheaper and better. For some enlightened companies such as Toyota, they have realized the tremendous cost of downsizing their employees because of the investment that has already been made.

    Each terminated employee represents at bare minimum 1.5 years annual tangible salary and benefits loss to the bottom line ranging from $30,000 to $200,000 plus. The intangible losses greatly increase that red ink and include:

    • Relationships those employees have established with external customers and other internal employees
    • Understanding of the ins and outs of the business
    • Additional growth in intellectual property (learning, training and development) by those same employees
    • Established loyalty and productivity

    TAKE ACTION ETHICAL COACHING TIP: Evaluate your organization from an executive leadership perspective. Are you leading forward, proactively during these difficult times or are you leading backward, reactively? Customer loyalty is the result of ethical leadership beliefs and actions. So before you terminate that next employee, take the 30,000 foot view and determine the real losses to your business.

    Want to develop ethical leadership? Take this free leadership skills assessment.

    P.S. Do you know what your talents are? Learn more about your ethical leadership talents to help you maximize education based marketing.

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    Leadership Ethics

    Pierre Du Plessis asked:

    Here are a few things to ponder on about leadership ethics and our own individual position with regard to these principles:

    1. General Douglas MacArthur’s Leadership Principles:

    MacArthur developed a list of questions to guide him in his leadership duties. These principles can be applied to any leadership situation.

    1. Do I heckle my subordinates or strengthen and encourage them?

    2. Do I use moral courage in getting rid of subordinates who have proven themselves beyond doubt to be unfit?

    3. Have I done all in my power by encouragement, incentive and spur to salvage the weak and erring?

    4. Do I know by NAME and CHARACTER a maximum number of subordinates for whom I am responsible? Do I know them intimately?

    5. Am I thoroughly familiar with the technique, necessities, objectives and administration of my job?

    6. Do I lose my temper at individuals?

    7. Do I act in such a way as to make my subordinates WANT to follow me?

    8. Do I delegate tasks that should be mine?

    9. Do I arrogate everything to myself and delegate nothing?

    10. Do I develop my subordinates by placing on each one as much responsibility as he can stand?

    11. Am I interested in the personal welfare of each of my subordinates, as if he were a member of my family?

    12. Have I the calmness of voice and manner to inspire confidence, or am I inclined to irascibility and excitability?

    13. Am I a constant example to my subordinates in character, dress, deportment and courtesy?

    14. Am I inclined to be nice to my superiors and mean to my subordinates?

    15. Is my door open to my subordinates?

    16. Do I think more of POSITION than JOB?

    17. Do I correct a subordinate in front of others?

    Source: The West Point Way of Leadership by Col. Larry R. Donnithorne

    2. Doing things differently:

    Anyone can become a leader. All the characteristics and traits of leadership can be acquired through learning and practice.

    Leadership is not synonymous with assertiveness, despotic behaviour or managerial position.

    Assertiveness is a good quality only if it can be backed up by respect. Respect stems from various sources as outlined lower down on this page.

    Management is about doing things efficiently. Leadership is about doing things differently, in new ways, in better ways. Leadership is about lateral thinking, being innovative and creative.

    Leadership is not limited to the top echelon in an organisation. Any person in an organisation, who can differentiate him or her self by being inventive, can be a leader. If you display inventiveness, others will follow your direction naturally out of respect.

    Leadership does not follow lines of authority. More often than not, creativity stems from the floor level nearest to the processes and problems. Leadership is therefore by no means limited to the formal structure of supervisory and managerial positions.

    The role of leadership can be earned in many ways, small or big. For instance, you can display leadership and earn respect from others in the following ways:

    1. Expert or superior knowledge about a subject or something

    2. Excellence in execution of tasks

    3. Positive attitude, high morale

    4. High ethical values and codes of conduct

    5. Good human relations

    6. Streamlining paper work, production, methods, your use of time

    7. Being innovative or creative

    Innovativeness usually results in bigger leaps with more benefits and profits. It can therefore be most profitable for an employer to cultivate, encourage and support the development of creativity and risk taking in all employees.

    Therefore, the most important quality to develop and the fastest way in order to become a leader, is through creativity.

    3. Other needed characteristics:

    3.1 Leadership traits:

    You will also have to foster the following traits to retain respect:

    1. Loyalty

    2. Willingness to stand out, differentiate yourself, risk being rejected by being different.

    3. Determination and perseverance to push through your own ideas.

    4. Improvement drive – desire to find better ways of doing things, curiosity.

    5. Questioning mind – not accepting authority, willingness to challenge the status quo.

    6. Self-belief – believing that you can think for yourself and devise a better way.

    7. Thick skin – being able to withstand criticism and recover from setbacks.

    8. Learning from mistakes – being prepared to try things to find what works.

    9. Trustworthiness – keeping your word, being honest.

    10. Delivering on promises – like being trustworthy, you deliver what you promise.

    11. Treating people with respect and fairness.

    12. Not deliberately harming others.

    13. Dedication to improving the lot of those you represent.

    14. Management skills – the ability to get things done efficiently.

    15. Strong influence skills

    16. The ability to convey a compelling vision of the future.

    These characteristics can be either classified under ethics or managerial skills. How do these characteristics compare with entrepreneurial traits?

    3.2 The psychological traits of entrepreneurs:

    1. Desire to perform

    2. Drive, determination and energy

    3. Goal orientation

    4. Time conscious

    5. Self-motivated

    6. Self-control

    7. Can make decisions in situations of lack of information or uncertainty

    8. Take calculated risks

    9. Positive self-image

    10. Creative and innovative capabilities (imaginative and real)

    11. High ethical standards about integrity and trustworthiness

    12. Intelligence

    13. Individualistic

    14. More task than human oriented

    15. Flourish on feedback

    16. Take initiative and responsibility for their actions

    17. Objective and optimistic

    18. Profit is a measure of success

    4. Gene Autry’s Cowboy Code of Ethics:

    1. The Cowboy must never shoot first, hit a smaller man, or take unfair advantage.

    2. He must never go back on his word, or a trust confided in him.

    3. He must always tell the truth.

    4. He must be gentle with children, the elderly, and animals.

    5. He must not advocate or possess racially or religiously intolerant ideas.

    6. He must help people in distress.

    7. He must be a good worker.

    8. He must keep himself clean in thought, speech, action, and personal habits.

    9. He must respect women, parents, and his nation’s laws.

    10. The Cowboy is a patriot.

    Ethics is about morality in a civilised world. It is about internalised values of the individual. It is about civilised behaviour versus barbaric behaviour. It is about human behaviour versus animal behaviour. It is about civilised human behaviour on the one end versus barbaric animal behaviour on the other end of the scale.

    Leadership ethics is all about where you are between the two extremes as an individual, as a worker and as a leader.

    In pursuing the traits of leadership ethics with the aim of internalising the principles of leadership ethics, it will be worthwhile to try and follow all the principles outlined above.

    The 3 Most Critical Steps for Ethical Leadership

    anonymous asked:

    With leadership comes a great responsibility to uphold a standard of integrity regardless of the cost. All too often we see leaders compromise their lifelong forged ethics just to gain the ever fleeting reward of “momentarily getting ahead.” This lack of ethical leadership has greatly shaped the values of our society. Albert Einstein said, “Try not to become a man of success; but rather try to become a man of values.” John Maxwell coined the well-known phrase, “leadership is influence,” and no one would disagree with that statement. But ethical leadership goes much deeper. Ethical leaders don’t just influence others; they influence others to do what is right.

    As leaders we have a great responsibility to not only do what is right but also influence others to do the same. Temporarily, it may not be easy and most often it doesn’t appear to be advantageous, but you must weigh every decision according to the long-term consequences of that decision. Ask yourself: What will it cost me in the long run if I compromise my integrity? What are the negative consequences that come from cutting corners or from cheating my customers? What reputation will I create if I make this decision?

    Below I have outlined the three most critical steps to achieve ethical leadership. By following these simple steps, you’ll not only establish credibility among your clients, but you’ll also outlast your competition. Credibility and longevity are what separate those who “just get by” from those who achieve great success.

    1. Hold yourself to a higher standard than is required.

    Every failure in life can be traced back to a compromise of character. You must raise your standards and set the example for those who work for you. Don’t allow yourself to compromise your integrity, but be resilient to always do what is right.

    2. Keep your word. It doesn’t matter what you promise.

    All that matters is that you do what’s been promised. A leader is defined by the quality of his action, not the rambling of his words; therefore make it the rule to always under promise and over perform.

    3. Tell the truth and be honest with others.

    A simple definition of honesty is: behavior in words and actions that aims to convey the truth. Conversely, dishonesty is a way of speaking or acting that causes people to be misled or deluded. Always consider the interest of others and not just your own. I say it like this: I would rather you hate me for telling you the truth than for you to like me for telling you a lie.

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    Ethics in Business – From Compliance to Commitment

    Rana Group asked:

    By the time this article goes to print all of us will surely have had our fill of news reports about Conrad Black’s infamous lawsuit. We’ll likely be numb to the never ending allegations of fraudulent practices at Nortel. But, how many of us as human resource professionals will be asking, ‘What does this have to do with me?’

    It seems that, by and large, human resource professionals have been quite happy to have the accountability for their company’s business ethics and code of business conduct rest with their legal or audit departments. In so doing, human resource professionals miss an opportunity to help their companies shift from merely being compliant with the law to demonstrating their company’s firm and unwavering commitment to build an ethical business culture.

    The ‘iceberg model’ helps us to better appreciate the influences that may undermine a company’s policies and practices with respect to business ethics. Think of the ‘the Law’ and your company’s Code of Business Conduct Policy as the tip of the iceberg, visible above the surface. Now, think about the influences that exist below the surface lurking within many companies. Things like:

    ? Pressures to conform (“Hey, we always take off early Friday afternoons, you need to join us or else someone’s going to take notice”)

    ? Desire to please (“I picked up the tab for a lunch I had with my boss. He told me it was the only way he could expense it without needing to get further approval. I did it because I wanted to stay on his good side!”)

    ? Accepted practices (“Don’t worry, we give box seat tickets to all our clients and they sure don’t have any problem with accepting them!”)

    ? Performance drivers (“Hey, maybe we should just alter our numbers a bit. If we do, we’re sure to be in the top category for a bonus this year!”)

    When asked, most of us do not hesitate to say that we are ‘ethical’. In fact some people are offended when asked to sign a document confirming they have read and understood their company’s Code of Business Conduct Policy. However, what we fail to recognize and appreciate is our ability to rationalize our own behavior. Sometimes we justify our actions so convincingly that we no longer even perceive that what we are doing is inherently wrong or unethical. For example:

    ? “I’ll just pad my mileage claim this month, it’s not like I haven’t worked hard. The company owes it to me.”

    ? “I know I shouldn’t provide my son with supplies from the office, but university is so expensive and, I know this company can afford the photocopying I do and the pens and paper I take.”

    ? “If this company can afford a company jet, hey, they can afford for me to take a few sick days to ski!”

    It is a slippery slope once employees believe they can justify actions and decisions that are fundamentally unethical. Reading a code of conduct policy and signing a piece of paper every year does little to help employees grasp and understand the essence of ethical conduct. Nor does it help employees apply good problem solving skills when they are faced with ethical dilemmas in the workplace. It may surprise some to know that virtually all the companies who have become household names (including Enron) as a result of their unethical business practices had well articulated policies and codes of conduct dutifully signed off yearly by their employees.

    Few companies are making the effort necessary to address these underlying influences and regrettably, only those that do will truly build ethical cultures. By taking the following 7 steps, human resource professionals can play a critical role in helping their companies move beyond compliance, raising the bar to demonstrate their deep commitment to developing an ethical business culture.

    1) Adopt a multi-disciplinary approach to building an ethical culture

    2) Communicate your Code of Business Conduct in plain language

    3) Ensure relevant policies, processes and practices align with your Code.

    4) Develop ethical leadership

    5) Gain employee buy-in

    6) Facilitate reporting

    7) Model the way

    Adopt a Multi-Disciplinary Approach

    Human resources must have a ‘seat at the table’ when matters of business ethics and code of conduct are discussed. That said, it would be wrong for human resources to act independently. Companies that are truly committed to developing ethical cultures adopt a multi-disciplinary approach that includes representation from their legal, financial, communications and human resource disciplines. Working together they develop a strategy that enables the development of an ethical culture that is truly sustainable.

    Use Plain Language in Your Code

    Most human resource departments do provide employees with a personal copy of their company’s Code of Business Conduct Policy at the time of hire. Many companies host their Code of Business Conduct and related policies on their intranet. However, few companies have taken the time to provide a document that is actually readable! By working with their partners in Communications, Human Resources can provide employees a document that is both easily referenced and easily read.

    Align Policy and Practices

    More than one company has been surprised to learn that upon review, some of their policies and accepted practices are not consistent with their company’s Code of Business Conduct Policy. Human resources can ‘lead the way’ by ensuring its policies and practices are ‘squeaky clean’; not only in the way they are written, but also, in the way they are executed. However, it is not only human resource policies that require review, virtually all corporate policies need to be reviewed in light of the company’s Code of Business Conduct Policy to achieve proper alignment.

    Develop Ethical Leadership

    Developing ethical leadership ought to be a primary goal of every leadership development program. Surely it is the role of human resources to ensure the topic of business ethics is adequately addressed in all leadership development programs. Not only do leaders need to know and understand their company’s Code of Business Conduct Policy but, they must also understand the role they play in facilitating an ethical culture. This is just as true for leaders at the frontline as it is for leaders at the executive table. Leaders often justify their own behaviors based upon what they see modeled by those to whom they report. Ethical leadership depends upon each leader understanding they are responsible and accountable for their personal actions and behaviors regardless of the actions of those at more senior levels of the company.

    Demonstrating ethical behavior as a leader is inextricably linked to building trusting relationships, the cornerstone of many leadership development programs. However, while many of these programs address the matter of trust and trusting relationships, few make the link to ethical behavior and the expectations of leaders. Whether through instructor-led training or on-line training, every leader needs to have exposure to the topic of business ethics. Leaders must be fully cognizant of behaviors that develop a strong ethical culture and those that erode that culture. They need also to understand their accountability when employees raise ethical issues and/or report unethical behavior.

    Gaining Employee Buy-in

    Ethical cultures are built when employees, like leaders, have exposure to training that helps them differentiate between ethical and unethical behavior. Depending upon the size of your company this can be accomplished either through instructor-led or on-line learning modules. Regardless of the methodology, employees need to be exposed to different scenarios and si
    tuations that they may face within their own work. Employees need an opportunity to learn in a non-threatening environment what is appropriate and what is inappropriate. Your company’s Code of Business Conduct Policy is an important topic that must be addressed not only in all employee development programs but in your company’s orientation program for new employees.

    However, learning in and of itself is insufficient. Building an ethical culture requires continuous reinforcement through a well thought out and on-going communication strategy and plan. Ethics needs to be woven into company newsletters, be reinforced through visual cues such as posters, and integrated into team discussions if a company is going to make significant head-way towards building a strong ethical culture.

    Facilitate Reporting

    Companies need to provide their employees with a means of reporting behaviors, decisions or actions they perceive are unethical and contrary to their company’s Code of Business Conduct Policy. This is best facilitated by providing access through a third party provider although many smaller companies encourage such reporting to their legal department or external legal counsel. That said, it is only through both educational and communication programs that employees understand their obligation to report unethical behavior and to realize that their company will fully support their actions provided, of course, that the reporting of unethical behavior is not maliciously motivated.

    Model the Way

    Finally, human resource professionals must model the way. For new employees, human resource employees are like a beacon signaling the strength of a company’s ethical culture. And, whether we realize it or not, the manner in which we conduct employment searches and implement recruitment practices sets the tone. Employees tend to assess the strength of a company’s ethical culture based upon their own personal experience and the experience of those with whom they have a close work relationship. They are sensitive to preferential treatment whether in regards to recruitment, compensation, performance management, or succession management and promotions. Human resource professionals must demonstrate through their actions an unerring commitment to ethical business conduct.

    Since the Enron fiasco it’s hard to pick up a daily paper without seeing some reference to or allegation of unethical business practices. And, based upon these articles it would be easy for us to assume that unethical behavior is limited to those at the very top of organizations. This is simply not the case. While building an ethical culture depends upon the full commitment of senior executives to set the standard of acceptable behavior, each and every employee directly influences the strength of your company’s ethical culture through their day-to-day actions. Cleary, code of business conduct policies are insufficient in and of themselves to shape ethical behavior. Human resource professionals must help their companies move beyond compliance with the law and, they can do so by ensuring each and every employee develops the knowledge and skills necessary to build strong ethical cultures.

    8 Steps to Effective Christian Leadership

    Sean Mize asked:

    Because both the Christian and non-Christian social environment has tended to expect that Christians measure up to their self-proclaimed moral and ethical standards, as they rightly should. What can you do to be sure you ‘stand up to the test’ in the area of Christian leadership?

    1) Probably the most important thing you can do as a Christian leader is to clean up your act—if there is anything in your life, moral or ethical, which would not stand up to scrutiny if the entire world found out—you must eliminate it immediately. Do not give anyone an occasion to think that you are a hypocrite.

    2) Be sure that every decision you make is honest and ethical. You cannot effectively lead, as a Christian or not, when your decisions and actions are not above-board, fair, and honest.

    3) As a Christian leader, commit to telling the truth no matter what. As a Christian leader, when you lie or tell half-truths, people tend to feel that your entire faith is a sham. In fact, if you are habitually lying and telling half-truths, your faith may indeed be a sham.

    4) Learn everything you can about the tasks at hand, even if it means working in the trenches for awhile. No one likes to be led by someone who has never done what they are doing. This doesn’t mean you have to become an expert, just participate in the menial work long enough to understand the frustrating aspects of the work. Another benefit to this is, when you have actually done the work, you can more effectively brainstorm solutions to challenges when they arise.

    5) Lead by example. Do you expect your employees or secretaries to arrive on time for work, and dressed well? Then you must do the same. Sometimes it is so easy to think that you have earned the right to come in whenever you feel like it, or to return from lunch whenever you wish. Sure, you may have earned the right, but you gain far more by setting the example for performance. Do you expect others to work overtime when a project is behind projections? Then you must be willing to do the same.

    6) Although you may feel you have earned the right to delegate away all the work, continue to be involved in productive tasks. By doing some of the work, not only do you gain the respect of your employees, but also you keep in touch with the flow of things. As a leader, it is easy to become disengaged from the actual productive segment of your business, and resultantly make decisions that look good on paper and sound good around the boardroom table, but are actually worthless when the rubber hits the road.

    7) Constantly reevaluate your own performance. Often, you may spend so much time correcting the actions of others and solving crises you didn’t create, that you develop a sense that others aren’t as capable as you. Consequently, you may not recognize when you are falling into bad habits that also need to be corrected. Be the first to recognize and correct your own short-fallings.

    8) Avoid pride. Once in a position of leadership, especially if you are good at what you do, it is easy to begin to feel that you are invincible. Once that occurs, you become vulnerable to pride, and may make decisions you would frown on if your subordinates made the same decisions. Maintain full responsibility for your actions, and keep them above-board at all times.

    Bonus Step:

    9) Learn to manage your time. When you are in a position of leadership and find yourself delegating away most of the time-consuming tasks, it is easy to lose control of your time. Again, when your employees see you wasting your time, they will tend to do the same.

    Ethics in Business – From Compliance to Commitment

    Rana Group asked:

    By the time this article goes to print all of us will surely have had our fill of news reports about Conrad Black’s infamous lawsuit.  We’ll likely be numb to the never ending allegations of fraudulent practices at Nortel. But, how many of us as human resource professionals will be asking, ‘What does this have to do with me?’

    It seems that, by and large, human resource professionals have been quite happy to have the accountability for their company’s business ethics and code of business conduct rest with their legal or audit departments.   In so doing, human resource professionals miss an opportunity to help their companies shift from merely being compliant with the law to demonstrating their company’s firm and unwavering commitment to build an ethical business culture.

    The ‘iceberg model’ helps us to better appreciate the influences that may undermine a company’s policies and practices with respect to business ethics.  Think of the ‘the Law’ and your company’s Code of Business Conduct Policy as the tip of the iceberg, visible above the surface.  Now, think about the influences that exist below the surface lurking within many companies.  Things like:

    ·        Pressures to conform (“Hey, we always take off early Friday afternoons, you need to join us or else someone’s going to take notice”)

    ·        Desire to please (“I picked up the tab for a lunch I had with my boss. He told me it was the only way he could expense it without needing to get further approval. I did it because I wanted to stay on his good side!”)

    ·        Accepted practices (“Don’t worry, we give box seat tickets to all our clients and they sure don’t have any problem with accepting them!”)

    ·        Performance drivers (“Hey, maybe we should just alter our numbers a bit.  If we do, we’re sure to be in the top category for a bonus this year!”)

    When asked, most of us do not hesitate to say that we are ‘ethical’.  In fact some people are offended when asked to sign a document confirming they have read and understood their company’s Code of Business Conduct Policy.   However, what we fail to recognize and appreciate is our ability to rationalize our own behavior.  Sometimes we justify our actions so convincingly that we no longer even perceive that what we are doing is inherently wrong or unethical.  For example:

    “I’ll just pad my mileage claim this month, it’s not like I haven’t worked hard.  The company owes it to me.”

    “I know I shouldn’t provide my son with supplies from the office, but university is so expensive and, I know this company can afford the photocopying I do and the pens and paper I take.”

    “If this company can afford a company jet, hey, they can afford for me to take a few sick days to ski!”

    It is a slippery slope once employees believe they can justify actions and decisions that are fundamentally unethical.  Reading a code of conduct policy and signing a piece of paper every year does little to help employees grasp and understand the essence of ethical conduct.  Nor does it help employees apply good problem solving skills when they are faced with ethical dilemmas in the workplace. It may surprise some to know that virtually all the companies who have become household names (including Enron) as a result of their unethical business practices had well articulated policies and codes of conduct dutifully signed off yearly by their employees.

    Few companies are making the effort necessary to address these underlying influences and regrettably, only those that do will truly build ethical cultures.   By taking the following 7 steps, human resource professionals can play a critical role in helping their companies move beyond compliance, raising the bar  to demonstrate their deep commitment to developing an ethical business culture.

    1)      Adopt a multi-disciplinary approach to building an ethical culture

    2)      Communicate your Code of Business Conduct in plain language

    3)      Ensure relevant policies, processes and practices align with your Code.

    4)      Develop ethical leadership

    5)      Gain employee buy-in

    6)      Facilitate reporting

    7)      Model the way

     Adopt a Multi-Disciplinary Approach

    Human resources must have a ‘seat at the table’ when matters of business ethics and code of conduct are discussed.  That said, it would be wrong for human resources to act independently.  Companies that are truly committed to developing ethical cultures adopt a multi-disciplinary approach that includes representation from their legal, financial, communications and human resource disciplines.  Working together they develop a strategy that enables the development of an ethical culture that is truly sustainable.

    Use Plain Language in Your Code

    Most human resource departments do provide employees with a personal copy of their company’s Code of Business Conduct Policy at the time of hire.  Many companies host their Code of Business Conduct and related policies on their intranet.  However, few companies have taken the time to provide a document that is actually readable!  By working with their partners in Communications, Human Resources can provide employees a document that is both easily referenced and easily read.

     Align Policy and Practices

    More than one company has been surprised to learn that upon review, some of their policies and accepted practices are not consistent with their company’s Code of Business Conduct Policy.  Human resources can ‘lead the way’ by ensuring its policies and practices are ‘squeaky clean’; not only in the way they are written, but also, in the way they are executed.  However, it is not only human resource policies that require review, virtually all corporate policies need to be reviewed in light of the company’s Code of Business Conduct Policy to achieve proper alignment.

    Develop Ethical Leadership

    Developing ethical leadership ought to be a primary goal of every leadership development program.  Surely it is the role of human resources to ensure the topic of business ethics is adequately addressed in all leadership development programs.  Not only do leaders need to know and understand their company’s Code of Business Conduct Policy but, they must also understand the role they play in facilitating an ethical culture.  This is just as true for leaders at the frontline as it is for leaders at the executive table.  Leaders often justify their own behaviors based upon what they see modeled by those to whom they report.  Ethical leadership depends upon each leader understanding they are responsible and accountable for their personal actions and behaviors regardless of the actions of those at more senior levels of the company. 

    Demonstrating ethical behavior as a leader is inextricably linked to building trusting relationships, the cornerstone of many leadership development programs.  However, while many of these programs address the matter of trust and trusting relationships, few make the link to ethical behavior and the expectations of leaders.  Whether through instructor-led training or on-line training, every leader needs to have exposure to the topic of business ethics.  Leaders must be fully cognizant of behaviors that develop a strong ethical culture and those that erode that culture.  They need also to understand their accountability when employees raise ethical issues and/or report unethical behavior. 

    Gaining Employee Buy-in

    Ethical cultures are built when employees, like leaders, have exposure to training that helps them differentiate between ethical and unethical behavior.  Depending upon the size of your company this can be accomplished either through instructor-led or on-line learning modules.  Regardless of the methodology, employees need to be exposed to different scenarios and situations that they may face within their own work.  Employees need an opportunity to learn in a non-threatening environment what is appropriate and what is inappropriate.  Your company’s Code of Business Conduct Policy is an important topic that must be addressed not only in all employee development programs but in your company’s orientation program for new employees.

    However, learning in and of itself is insufficient.  Building an ethical culture requires continuous reinforcement through a well thought out and on-going communication strategy and plan.  Ethics needs to be woven into company newsletters, be reinforced through visual cues such as posters, and integrated into team discussions if a company is going to make significant head-way towards building a strong ethical culture.

    Facilitate Reporting

    Companies need to provide their employees with a means of reporting behaviors, decisions or actions they perceive are unethical and contrary to their company’s Code of Business Conduct Policy.  This is best facilitated by providing access through a third party provider although many smaller companies encourage such reporting to their legal department or external legal counsel.   That said, it is only through both educational and communication programs that employees understand their obligation to report unethical behavior and to realize that their company will fully support their actions provided, of course, that the reporting of unethical behavior is not maliciously motivated.

     Model the Way

     Finally, human resource professionals must model the way.  For new employees, human resource employees are like a beacon signaling the strength of a company’s ethical culture.  And, whether we realize it or not, the manner in which we conduct employment searches and implement recruitment practices sets the tone.  Employees tend to assess the strength of a company’s ethical culture based upon their own personal experience and the experience of those with whom they have a close work relationship.  They are sensitive to preferential treatment whether in regards to recruitment, compensation, performance management, or succession management and promotions.  Human resource professionals must demonstrate through their actions an unerring commitment to ethical business conduct.

     Since the Enron fiasco it’s hard to pick up a daily paper without seeing some reference to or allegation of unethical business practices.  And, based upon these articles it would be easy for us to assume that unethical behavior is limited to those at the very top of organizations.  This is simply not the case.  While building an ethical culture depends upon the full commitment of senior executives to set the standard of acceptable behavior,   each and every employee directly influences the strength of your company’s ethical culture through their day-to-day actions. Cleary, code of business conduct policies are insufficient in and of themselves to shape ethical behavior.  Human resource professionals must help their companies move beyond compliance with the law and, they can do so by ensuring each and every employee develops the knowledge and skills necessary to build strong ethical cultures. 

    Why We Should Promote Ethical Leadership Today

    Muna wa Wanjiru asked:

    Leaders of today often spread hatred among various communities in order to project themselves as a champion of a particular community. This is a very dangerous situation.  Leaders are people who have the capability to galvanize people for some specific purpose.  If the purpose is constructive, it goes on to create a just society where people live in harmony but if the leaders have some sinister motives then it would bring mayhem in the society.  So today, it is very imperative that ethical leadership should be promoted.   

    Let us understand what actually ethical leadership is. Ethical leadership is about having certain standards and principles.  Here a leader just does not lead but he always monitors his activity seeing whether he is keeping up the standards or is he deviating from the set standards.  He is ready to suffer loss but he is not ready to compromise with his principles.  Today it is very much required in the corporate world. Today companies hide their actual financial position to lure the investors.  So it is imperative that ethical leadership should gain momentum in the corporate world.

    Communication should not just serve as a means for conveying a message but the communication should be ethical also.  Enron of USA cheated the public by not disclosing their actual financial position.  So it is important that the industries’ should always state what is right though it might be bitter.  Political leaders’ too should refrain from hurting the sentiments of other communities.  They should promote tolerance among various communities. 

    Leadership also means that giving the best to the public.  In business, it is not just the shareholders and customers who should be taken care of but the business should focus on entire society including the biosphere.  Ethics demand that customers should get product of best quality at appropriate rate and there should be no alteration in it.  Motive should not be only profit but the motive should also be to serve the customers.  Corporate social responsibility is today being practiced by most of the organization.  Here the companies use their capital for some social cause such as for child education, AIDS etc. It is a good practice and even the government is encouraging it.

    Ethical leadership also demands that leaders, whether they are from industry or from other sectors, should have a broader outlook.  They should not surround themselves with yes men and take decisions based on their advice.  Leaders should have a proper succession planning wherein the other people are groomed as leaders so that they can take the charge once the incumbent departs.   This prevents the void, which often creates havoc in any organization.  Leaders should also occupy the office for a particular tenure after which they should voluntarily step out paving way for others. Such practices in the political as well as corporate world will help in creating a better environment where people will live together without any hatred.

    The Truth About Ethical Leadership

    Akhil Shahani asked:

    Leadership is a relationship between leaders and followers. The foundation of this relationship is trust. Ethics refer to the principles that define behavior as right, good and proper. There is an inextricable link between leadership and ethics. Leaders must themselves be ethical in their decisions and actions in order to influence others to behave accordingly.

    Without a common set of values, an organization is merely a collection of individuals coexisting (perhaps uneasily) within common boundaries. A well defined value system creates a common understanding within the group of what constitutes acceptable behavior.

    This piece helps you understand the essence of ethical leadership and the ways in which you can practice it. You might also like to check out and for more on this subject.

    Value sharing: As an ethical leader, it is your responsibility to set the standard of truth. Since you are the one in control, you can set the benchmarks for doing business the right way. However, leading by example may not be sufficient by itself. You need to pass on a clear message to the rest of your organization about the standards they must adhere to.

    Share your knowledge and values throughout the organization for its benefit. A company value statement is en effective way of reinforcing the message.

    Quality orientation: Business ethics is all about providing value for the customers and other stakeholders. That’s why a quality policy must be part of the company’s DNA. It is your responsibility to champion this cause, and drive the quality program throughout your firm. Well respected organizations like GE have demonstrated ethical leadership by pursuing a relentless quality ethic.

    Openness: It is but natural that leaders will depend upon a core advisor group for key decisions. Often, this group is small and creates a coterie, which is not necessarily in the larger interests of the organization. Ethical leadership is all about a more open collaboration between different members. A larger and more fluid influencing group, put together depending on the needs of a specific situation is likely to result in a more unbiased decision making process.

    Participation: Although you have the power to take decisions, allow your employees to contribute to the process. Support and guide your team members wherever necessary, so that they will be able to utilize their capabilities to the fullest. Adopting this practice of ethical leadership is especially effective when you wish to implement change or minimize risk.

    Succession planning: All leaders, including independent entrepreneurs must plan on handing over the reins someday to a worthy candidate. This is not an overnight process. Succession planning is an integral part of ethical leadership, and must begin during the current leader’s tenure. Potential leaders must be identified, guided and trained to take charge in future. Closely linked to this is the question of how long a leader must stay at the helm of affairs. Regardless of a mandatory retirement age, an ethical leader must choose to stay on only as long as the community around him feels that this is in the larger interests of the organization. Self serving considerations must be put aside, while deciding on this issue.

    A common misconception is that ethical leadership is “soft”. Nothing could be further from the truth. An ethical leader can wield as much authority and influence as any other. What makes him stand out is that he does not lose sight of the organization’s cherished values in the process of leading.