Charles Hampden-Turner, the management philosopher and The Institute Authenticity Companion, characterises authenticity as “what lies between people”, which is a recognition of the importance of relationships to everyone who leads. 2018 saw the ethical decision-making of numerous high-profile leaders questioned, regarding their relationships with both their internal and external stakeholders. 

It seems that unethical behaviour is being increasingly challenged as more openness and transparency is demanded: Philip Green was accused of racial and sexual harassment; Martin Sorrell resigned after an internal investigation into claims of personal misconduct and Carlos Ghosn was arrested, and sacked, over claims of misleading investors and misusing company assets. 2019 will see how the relationships between the organisations, of which these leaders were a part, and their varied stakeholders will be affected. 

Ethics are rules of behaviour based on ideas about what is morally good and bad. Acting ethically means to act in ways that are morally good – commonly referred to as following your moral compass. Acting immorally may bring you and your organisation short-term success but will undermine the chances of longer-term success. 

Read on to discover how to set your moral compass. 

1.    Seek alignment

2018 saw the growth of a consumer movement which demands to know more about supply chains and the internal practices of organisations. Look out for our new research, to be published early in 2019, which confirms that authentic leaders demonstrate a clear ethical alignment between their internal values and how they treat staff, as well as how they relate to their suppliers, the environment in which they operate and their supply chains. 

2.    Communicate your code of ethics

The leadership team’s moral compass should be reflected in a company’s code of ethics, ensuring that everyone across the organisation is acting in a fair and equitable way. Our free, ethics webinar can help you to develop an ethical culture that you and your teams can be proud of.

3.    Be a person with purpose

In 2018 we heard a lot about millennials’ desire to work in organisations with purpose. Peter Drucker (1909-2005) whose management philosophy is kept alive every year at the annual Drucker forum, emphasised how every organisation must have a theory of business - essentially a purpose – and, that it must be clear about what that theory is and keep sight of it. 

If your purpose is lost, or it becomes out of date, your organisation will stagnate and die. (Members can view our 2018 Drucker Forum Report here). 

4.    Let’s be honest

Honesty and fairness underpin all ethical decision-making. Professor of Health Psychology Susan Michie, of University College London, explains: “authentic leaders are guided by a set of values that are oriented toward doing what’s right and fair for all stakeholders.” 

This is confirmed in research by Zenger and Folkman (2014) in which they identified that high integrity and honesty were the second-most important characteristics to have an impact on a leader’s success, after the ability to inspire and motivate others.

5.    Walk the talk 

Be a role model for your teams. Your behaviour should bring attention to whether everyone is behaving ethically in areas as diverse as corporate governance to the sustainability of the environment they impact; from their fiduciary responsibilities to their customer service. 

How to lead ethically in practice

Try out our flagship e-learning tool, MyLeadership, and take our MyLeadership Opportunities assessment to highlight where your experience and potential strengths lie. Receive a free, personalised report including customised suggestions for maximising your leadership development opportunities.