By Amanda “Jo” Erven, CPA, CIA, CFE
Ethical leadership is doing the right things, at the right time, for the right reasons.
Our capitalistic legacy is one of driving for shareholder returns, market share, and revenue growth.
These motivations for growth and profit have produced things like… Facebook’s disregard for personal privacy and data security, resulting in massive fines… Boeing’s lack of transparency and urgency in responding to catastrophic design failures involving the crash of two Boeing Max 737 airplanes, resulting in 346 lives lost…. and Johnson & Johnson’s aggressive marketing of opioid-based drugs to the point that an Oklahoma court found the company a “public nuisance,” and sadly, also resulting in many lives lost.
Our higher education public/private model has also produced exorbitant costs resulting unaffordable education and student debt. And our healthcare system no longer produces world class results, but costs (per capita) twice that of those of the developed world with disparate impacts – as highlighted by the pandemic.
To me, all these cases are examples of doing the wrong things, at the wrong time, for the wrong reasons – my definition of unethical leadership.
There has been recognition (see latest Business Roundtable statement, if you don’t believe me) in recent years that shareholder returns are not the “be-all” and “end-all.” There is a growing recognition of the legitimate needs of all enterprise stakeholders. And lucky for us (if you can call it luck), the recent pandemic has produced many excellent examples of ethical leaders meeting a variety of stakeholder needs, in this extraordinary time.
A recent Forbes article titled “Greater Capitalism: How the Pandemic is Permanently Reshaping Our Economic System for the Better“ highlighted some positive impacts of the pandemic as well as the Top 25 Corporate First Responders. (Excellent articles, I suggest reading both fully, if you read nothing else this year.)
The list of extraordinary efforts “to meet the challenges… of supporting and protecting workers, customers, and communities” included extra compensation and benefits, delayed payment for products and services, extended leave and relaxed attendance policies, ensuring safe work environments, millions in donations to institutions and communities in need, and the list goes on.
What I’ve seen is many positive changes have occurred in how to lead – with a much-needed focus on employee, customer, and community impact. Higher education and healthcare institutions have, by necessity, also embraced virtual tools that in the end will provide a leaner, more efficient, industries and systems.
My hope: That the changes will be noticed more, imitated often, and long-lasting. Because I truly believe the response and changes due to the hard lesson of the pandemic, are the most pure lesson in ethical leadership one could find.
Because, again:
Ethical leadership is doing the right things, at the right time, for the right reasons.
This article was originally posted at Audit, Consulting, & Education Services
Amanda “Jo” Erven, CPA, CIA, CFE is a faculty member of LEADERSHIP USA.