Ethical Leadership

by terrywelford

in Leadership

“The reputation of a thousand years is determined by the conduct of one hour.” - Japanese proverb

Ethics is a topic we’ve heard a lot about in the news for the past few years. There have been too many stories about the lack of ethics in the leadership of some of our top organizations. It’s been clear that many organizations have played it somewhat loosely when it comes to ethical standards.

EthicsThe Japanese proverb above clearly conveys what can happen when we act unethically – one act, one decision, or one moment can destroy a long-standing stellar reputation. One needs to look no further than the example of Penn State. How various leaders handled troubling information that they received about one of their coaches, and how these decisions impacted Penn State’s image, reputation and brand is a textbook example of this proverb.

Did you know:

  • 55% of US consumers take into account an organization’s ethics and values when buying a product or service?

The reality is that organizations don’t make the ultimate decisions about ethics – ethical choices are made by people. What does it mean to be an ethical leader? The Business Roundtable for Corporate Ethics identified the following characteristics of ethical leaders:

  1. They articulate and embody the purpose and values of the organization.
  2. They focus on organizational success rather than personal ego.
  3. They find the best people and develop them.
  4. They create conversation across the organization about ethics and values.
  5. They create mechanisms of dissent.
  6. They make difficult decisions, uniting “doing the right thing” and “doing the right thing for the organization.”
  7. They know the limits of the values and ethical principles they live (for example, “putting shareholders first”).
  8. They frame actions in ethical terms.

Ethical choices are somewhat easier to make when faced with a clear decision between right and wrong. Challenging ethical decisions occur when managers are confronted with a dilemma – a situation where there are two conflicting “right” choices.  You see, the really tough choices are not usually between “good and evil,” but between “good and good” – for example:

  • Truth vs. loyalty
  • Individual vs. community
  • Short-term vs. long-term
  • Justice vs. mercy

So, let’s say you’re a pilot for a commercial airline. The plane is full, and you’re flying into a bad snowstorm. Suddenly you receive word that a passenger has suffered a major heart attack.  A doctor who happens to be on board tells you that, if the passenger doesn’t get to a hospital quickly, he will die.

You radio the control tower at the nearest airport. You are told that the poor weather conditions on the ground make landing risky, so you should continue on to your planned destination, which is two hours away. Do you demand an emergency landing for medical evacuation to save the life of the one passenger, putting the lives of the other passengers and crew at risk? Or, to protect the lives of the many, do you continue on, knowing that one passenger will most likely not survive?

Most managers will not face life-and-death decisions (thankfully!) like our pilot in the above scenario. But when confronted with “good vs. good,” how do you decide on the right path to take? Ask yourself which of the conflicting choices:

  • Is most in line with laws, regulations and organizational procedures?
  • Is most in line with organizational values?
  • Provides the greatest benefit to the largest number of stakeholders?
  • Establishes the best precedent for guiding similar decisions in the future?

Take the Ethical Action Check below to assess your own journey to ethical leadership:


  • What are my most important values and principles? Does how I spend my time and attention reflect these values? What would my employees and peers say my values are?
  • What could my organization do or ask me to do that would cause me to resign for ethical reasons?


  • What mechanisms and processes have I designed to be sure that the people who work for me can push back against my authority?
  • Do I lead by example? Can I use my day’s work to teach others to be ethical leaders?


  • What do I want to accomplish with my leadership?
  • What do I want people to say about my leadership?

“The time is always right to do what is right.” - Martin Luther King, Jr.


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