01 Apr Scarlet Thinking and Ethical Leadership
Ethical Leadership as a Leadership Competency
Definition of Ethical Leadership as a competency: Leadership based on a moral, pro-social foundation. This means that social interest, the environment and corporate social responsibility are taken into consideration, along with the usual stakeholders’ interests.
In 2008 Bill Gates spoke about the need for ‘Creative Capitalism’ at The World Economic Forum.
“The world is not getting better fast enough, and it’s not getting better for everyone”
Gates’ resounding call to arms urged the world of business to prioritise corporate social responsibility (CSR). Kerr (2007) points out that “this “double bottom line” is supported by existing corporate laws that allow boards to consider stakeholders other than shareholders.” CSR is not only part of the current ethical landscape; it is a legal necessity.
Keeping it Real
Ethical leadership is often more of an ideal than a reality. Stakeholders’ interests can often seem more pressing that social concerns. Balancing every need in every decision is almost impossible. Nevertheless, an ethical leader will at least try to do this. Their decision making will take account of interests that go beyond the bottom line.
Like authenticity, ethical leadership is often more obvious in its absence. In our well connected digital world, both customers and press are keen to jump in and share the news when an organisation or leader has been demonstrating less than ethical leadership.
At the time of writing, we are hearing more and more about Facebook and the Cambridge Analytics data scandal every day. People are deleting their Facebook accounts and asking for all the information Facebook holds on them. They are shocked by the amount of data out there. Even down to files of all our text messages. The new GDPR data and privacy regulations are coming in here in the UK in around a month. Our whole ethical use of data is being questioned. Being an ethical leader is difficult because everything is changing so fast. We have had few rules to work with. However, we all know that what Facebook and Cambridge analytical have done is unethical.
There is a strong need for ethical leadership today and the figures back this up. The number of social enterprise start-ups in increasing in proportion to profit based businesses. Business pundits are talking about the triple bottom line.This is an accounting framework that includes environment and social dimensions. In the UK, The UK Governance Code asserts that risk assessment should also consider “health, safety and environmental, reputation, and business probity issues”.
How can we become Ethical Leaders?
- Investigate your own values and decide what you stand for?
- What issues are absolutely non-negotiable for you?
- Let others know this if necessary
- Monitor your decisions from various angles. One useful exercise to visualise a highly ethical role model and ask yourself “Would X do this?”
- Find other ethical leaders and build you own support network. Being an ethical leader can be tough, confusing and lonely
- Make a point of pointing out and praising ethical behaviour within your organisation
- Explain your decisions and the values that led to them. Be clear and open.
Questions to ask Yourself on Ethical Leadership
- Do I have my own code of conduct?
- Who do I admire who is an ethical leader?
- What sort of ethical dilemmas have I faced in the past?
- Am I facing any right now?
The Pay Off
Ethical behaviour encourages others to act more pro-socially, creating a virtuous circle. This means that, as time goes on, you will find it easier as you will have a supportive network around you. This will also tie into legacy and your long term impact.
Ethical Leadership References
Kerr, J. (2007). Sustainability Meets Profitability: the Convenient Truth of How The Business Judgement Rule Protects a Boards Decision to Engage in Social Entrepreneurship. Social Science Research Network