A Leader's Personal Moral, Ethics and Principles

In a previous article, we discussed the “inner” and personal values of all people, and specifically of leaders, and of the impact that these “inner” subjectivities can have on a leader’s journey.

When the leader exposes their values to the organisation, they establish or at least affect, the way the organisation behaves. These values move from internally held (and private) values to externally applied (and public) values or principles.

These values, when externalised, become the leader’s and the organisation’s moral, ethical and principled standards that direct their behaviours and determines for them what is acceptable and what is not.

The “inner” issues that affected the leader’s way of dealing with their context included “walking the talk”, integrity, fairness, empathy, trust, loyalty, and personal responsibility and accountability. Just as these influences affected leaders, they equally affect their organisations – because the organisation is composed of people with their own interpretations of those issues.

To avoid both ambiguity and conflict, demonstrating and stating what the organisation accepts and rejects is both important and valuable.

But let’s not be shy about this, many organisations state as a value or ethical standard, that which they think people (i.e., customers, shareholders, staff, and other stakeholders) want or need to hear. And when what they hear resonates with them, then they’re more likely to buy or interact with the organisation.

Self-serving – certainly; but not everyone is like that and just because you have a value or view that benefits you, doesn’t necessarily mean it’s wrong or inappropriate.

When a leader (or anyone for that matter) discovers that what they believe is right or wrong, and the organisation condones or encourages the opposite, then that person has a dilemma: do they stay, or do they leave?

Before they make that huge decision, there are a few questions they can ask themselves before they adopt either option:

1. Is the difference in values and ethics real or “merely” perceived?
2. Is the opposite view formal or informal?
3. If the opposite view is informal, then who holds that view?
4. Does the superior of the person who holds that view know of the view and have they attempted to change it, or do they endorse it?
5. Can you change the opposite view?
6. Is there a way to make your view the organisation’s view?
7. What effort, time or impacts need to be absorbed by you and the organisation to adopt your view?
8. Is the opposite view fundamental to who you are?

If the answer to these questions make you believe that the opposite view to your view is entrenched, unchangeable or confronting your value system, then leave, and that would be a good decision for you.

On the other hand, if you believe in your view and think the organisation can benefit from adopting it, and it’s achievable and important, then stay and transform the organisation.

Here are three real example of leaders confronting an ethical challenge:

1. A CFO worked for an organisation whose founder CEO/chairman had, in the CFO’s opinion, an inappropriate definition of legality, accounting principles and business ethics. The CFO and CEO had numerous discussions about this, and the CFO felt that the CEO would never change. The CFO resigned.
   
   
2. A chairman was appointed to a start-up company. The chairman defined the ethics, standards, and processes for an effective board. The Founder of the venture who was the CEO presented operational facts that the board relied on. The CEO also made statements that proved to be misleading and wrong (i.e., lies). The chairman felt that the initiative was worthwhile, but he relied on the CEO – he needed to trust the CEO. He felt that there was no point in fighting with the CEO, because of the CEO’s criticality to the initiative. The chairman resigned and on the same day, the rest of the board did too – because they had adopted the chairman’s moral standards.
   
   
3. A public board had decided to undertake business in a new country. The board had a strict ethical and moral code. After commencement, they found that to do business in the new country, they had to adopt the business practices of that country. The business practices of that country included embedded bribery. The board was struggling with how to handle this: do we sacrifice share price and shareholder benefit, or do we sacrifice our principles? They sacrificed their principles.

How would you handle the following situation? You work for a well-known organisation that you believe, and they state, is a legal and ethical business that sells products. After a couple of years, you find out that a few of their offshore suppliers use child labour. How do you handle it?

Such situations are, tragically, not uncommon.

When one explores this, one finds many examples of “people being people” - of people doing things that are immoral, unethical, illegal, unprofessional, inconsiderate, rude, intolerant, sexist, and so on.

When someone does something like this while working for the organisation, the common response is to terminate them, because of the possible ramifications on the organisation, and not necessarily because of the impacts on an aggrieved party.

However, if the person is really important to organisational performance, then the temptation is to be a little more conciliatory – at the expense of principles.

Sometimes the continuity of the person is impossible – such as when they harm someone, steal from the organisation, or break the law in a serious manner.

However, that’s not always the case, and often organisations provide warnings and may enter the event or incident into the employee’s staff record.

How does an organisation handle a breach of its ethical standards by an employee, but the breach happened when the employee was not at work? Say, for example, a family violence incident, or sex acts with minors, or taking or selling drugs, or posting things on Facebook or Twitter that are clearly in breach of the organisation’s ethical standards and employee rules.

Whatever the ethical standards adopted by the organisation, the leader is responsible and accountable for compliance by all employees - including themselves.

If you need help to clarify the situation in your organisation or if you need support implementing a more ethical environment, contact us at [email protected].

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