Your firm isn’t going to be starting from scratch. There will be lots of things to do with ethics going on, that can be brought together and built upon. And there may well be some odd things going on that need to be resolved.
Leadership on ethics doesn’t just happen. It benefits from following some core ideas and draws on particular skills. That’s what this free guide brings together for you. I hope it’s helpful.
The Key Concept
Leadership on ethics is about leadership. The thing you’re leading on is ethics. This is not the same as ethical leadership, with which it is often confused. That is about the ethical side of how you lead – the focus is on you. With leadership on ethics, the focus on what happens through your leadership – the results.
An example will illustrate the difference. A claims director shows a personal example by foregoing the expensive hospitality being offered by a supplier of software: that’s ethical leadership. In the same case, the claims director would show her managers and team leaders how offers of hospitality by suppliers should be managed within her vision for a claims service run with integrity: that’s leadership on ethics.
Another term associated with leadership and ethics is ‘tone from the top’. The problem with it is that it doesn’t come across as results driven. Leadership means doing things and making things happen. Tone is important but it’s only part of what you need to do.
Think Like a Coach
Think of leadership on ethics as if you were a coach. The firm is your team and the firm’s owners want you to organise your team so that they score ethical goals.
It’s down to you to organise resources so that the team can keep on going, game after game, without having to keep on referring back to you all the time about everything they’re doing.
Think about it - most of the decisions in your firm are not made by yourself and other people at the top, but by the many people employed to deliver the outcomes that your firm wants to achieve.
Sticking with our coach analogy for just a second, you don’t have to be the big expert on ethics in your team. That’s not what you’ve been hired to do. Anyway, you’re also busy with a lot of other things, for which you use subject experts there too. The same goes for ethics.
Your role is to get the best out of the overall team, by setting the ambition, by understanding what people on the team can contribute, and by making sure they get the support they need to deliver the results.
If you have responsibility for others at work, then you need to show leadership on ethics. So the ‘you’ here means everyone from team leaders up to chief executives.
Obviously, the nature of the leadership on ethics expected from a team leader will differ from that expected by a chief executive. Yet the substance of each will be pretty similar.
Here’s an example. The team leader will inherit the ethical vision set by the chief executive, but that team leader will have to interpret that ethical vision in a way that means something to the people in their team, and then help those people to deal with any tough decisions that that ethical vision throws up.
This means that leadership on ethics is something that is
- done to us - by a senior executive or head of office;
- done by us - in our own role as leader of our team;
- done with us – in association with other team leaders and managers across the firm.
Be Clear About the Point of It All
When senior business people were asked what makes for an effective leader in a business setting, the competency they ranked the highest, by a clear margin, was ‘high ethical and moral standards’.
Remember that these people weren’t ranking high ethical standards as just a personal quality. They were ranking it as a quality of what constitutes an effective leader in a business setting. They realise that high ethical standards help deliver business results…
- investors like ethical standards because they represent less risk to their investment;
- employees like them because they signal a more secure, open and honest workplace;
- customers like them because they point to a firm that they can trust, for its honesty, reliability and fairness.
High ethical standards are up there as the top competency not just because it feels like the ‘right thing to do’, but because it also helps deliver what leaders are tasked to deliver, which are strong, sustainable businesses delivering healthy results.
Go Beyond Compliance
Compliance is about rules and regulations - it’s ‘what you have to do’. Ethics goes beyond that – it’s ‘what you should do’. This quote from Professor Luciano Floridi of Oxford University highlights this: “Ethics comes before the rules, during the rules and after the rules.”
So what about ‘conduct’? It overlaps with ethics, but is not the same. Conduct is centred around standards of behaviour. Ethics certainly covers the same ‘standards of behaviour’, but also picks up corporate decision making. Examples of this would be the way that products are designed, the way in which they are distributed, their pricing and the services associated with them.
Lead On What Matters
Leadership on ethics should be orientated around ethical values like integrity, not business values like innovative. You need to be clear about those two types of values.
The ethical values you’re leading are those of your firm, of your profession and those of your customers and the wider public. Leadership on ethics is not about you ; it’s about your firm, the professionalism of the sector in which it does business, and what matters to the public it serves.
Build On What You’ve Already Got
You’re not starting your leadership on ethics from scratch. You’ll draw on personal experiences for how you shape your leadership on ethics. These could be significant moments in your life or the support you got from others.
So while your leadership on ethics should be orientated around the needs of the business, how you shape this and drive it forwards will be influenced by how you came to be the leader you are. Qualities like awareness, engagement and authenticity make a big difference.
You will have spotted that these qualities are representative of not just good leadership on ethics, but good leadership overall.
Get the Balance Right
You need to give others responsibility for different elements of your ethics plan. You’ll still be the one accountability for it all, but delegation matters, for two reasons.
Firstly, it’s how a coach works. They don’t score the goals – they organise their team to do that.
And secondly, ethics has to work across the firm, within its different levels and in all sorts of situations. You’re not always around, let alone visible.
There are five skills at the heart of leadership on ethics, and each of them will help you delegate responsibility while maintaining accountability.
Learn the Language of Ethics
You need to learn about the language of ethics in order to communicate to others what you want them to do, and why. This doesn’t have to be philosophical - a good, straightforward understanding of business ethics as it relates to your firm and your responsibilities will be sufficient.
Knowing the language of ethics helps you answer questions on your ‘business case for ethics’. It also helps you recognise where others are speaking a dissonant language, and to be confident in challenging them.
Create a Clear Ethical Vision
A clear ethical vision is important because there’s no point leading on ethics if you don’t know where you’re going. And people won’t follow the lead you’re trying to give on ethics unless you show them the ethical direction you want them to take.
Your ethical vision should…
- look ahead, but not too far ahead – two to three years is fine;
- address the ethical challenges your firm is facing;
- draw upon a diverse pool of opinion – listen to other people;
- mean something to people in your firm – relevance creates motivation.
Ethical visions start life as the initiative of a particular leader and quickly evolve into something adopted and owned across the firm. It should be simple, clear and pragmatic. It also needs to be shared, and open to being tracked in some way.
Help People Make Better Decisions
Your people need to plan, act and deliver according to your ethical vision. This means having a clear vision, adjusting processes to support it and addressing pressure points. It means showing people what good decisions look like and giving praise when this happens. And dealing with poor decisions openly and firmly.
If the ethical vision is ambitious, give people steps to get there and progressively raise the bar on what good looks like. Listen to problems but don’t accept excuses.
There’ll be lots of decisions in between the good ones and poor ones. Case studies and training in ethical decision making will show people what a better decision can look like and give them practice at working towards it. Encourage them to discuss these situations with others, for example in team meetings.
Remove the Hurdles
Your ethical vision will both reflect the aspirations you have for your firm and the challenges it will face getting there. The aspirations will only be realised if the challenges are dealt with.
The hurdles that leadership on ethics can face at the corporate level include:
- the firm’s ethical culture - “we’ve always done it that way”;
- performance expectations and targets - “can the firm afford to change how it works”;
- concerns about time, resources and priorities – “we can’t afford this”;
- market traditions: for example, “the market has always done this”;
- carrying on regardless - “we’ve still got clients despite this”.
You need to understand those concerns and know how to respond to them. For example, clients usually express their concern about something by not trusting you with their business.
Hurdles at the personal level can include…
- a lack of confidence that change is possible;
- a concern that past decisions will be criticised;
- a view that such changes have “nothing to do with me”;
- perceptions that nothing will change, “so why bother”.
Your leadership on ethics needs to recognise these and prepare for them. Start with a communications plan that is clear about change being needed, that reassures people about how past decisions will be treated, and that speaks to all levels of the firm.
Set a Personal Example
There’s no point expecting high ethical standards from people in your firm, if you don’t follow them yourself. If you don’t set an example, then others will follow your cue and not bother either. You’ve got to ‘walk the talk’.
This means making sure people hear, see and experience the personal example you’re setting. If you’re an executive, a lot of people in the firm will never see you, so be sure to go beyond speeches and statements. Tell people about the tough decision you’re taking in line with the ethical vision, such as disciplining bad behaviour or not working with a supplier.
Setting the right personal example is only one component of leadership on ethics, but it is a pivotal one, capable of undermining all other components if it isn’t done well. It’s personal to you, and so requires care and attention to make sure it is strong, clear and consistent.
Show Leadership Beyond Your Firm
Some of the aspirations and challenges in your ethical vision will be shared by other firms in the market. You’ll make more progress on them by working together.
Use various platforms to encourage cooperation and set expectations. You may even have to challenge laggards to make the most progress. More likely, this is about organising the similar minded people who will want to join with you.
I hope this is useful. Any questions – get in touch.
And whenever you’re ready, here are three ways in which I can help…
- craft or revitalise an ethical vision;
- gauge priorities and expectations;
- frame next steps to overcome hurdles / boost progress.