March/April 2018

On Ethics
Do You Model Ethical Leadership?

Ethical leadership at the senior levels is the greatest influencer of ethical behavior throughout an organization. Yet, a recent report is calling on firm leaders to stop looking through rose-colored glasses and step it up to serve as ethical role models.

Research conducted by the Ethics and Compliance Initiative reveals that senior leaders aren’t doing as well as they think they are on emphasizing their organization’s commitment to ethical conduct and integrity. Far too often, nonmanagement-level employees believe that too many top leaders blame others when there’s misconduct or a crisis. When things go wrong, and leaders fail to take responsibility, pessimism within the organization builds.

Ethical leadership and commitment to workplace integrity, according to the report, yields benefits for organizations through reduced pressure to compromise standards, reduced observed misconduct, increased reporting of misconduct when observed, reduced retaliation against whistleblowers and reporters of misconduct, and increased retention of valued employees. Firm leaders should go beyond just talking about ethics and integrity in the workplace. And particularly during challenging times, they need to provide consistent messages.

When it comes to ethical values and ethics resources, overcommunication shouldn’t be seen as a negative. As a start, organizations should conduct surveys to gain an understanding of employees’ awareness of ethics and compliance resources. The firm’s code of ethics or conduct should be released in different forms (online, hard copies, and apps) and should be integrated and marketed in all company departments to serve as a consistent reminder to all employees.

Most important, when employees believe that their supervisors and top management are ethical, they will report unethical behavior and misconduct. The human resources department and reporters’ managers should work in coordination to ensure employees feel safe and to monitor for signs of possible retaliation.