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Ethics” is derived from the Greek word “ethos,” which means “character”. “Character” is defined as
“the combination of qualities or features that distinguishes one person from another.” It is also defined
as “the public estimation of the person — reputation.”
Ethics are the moral values, beliefs, and rules that establish the right or appropriate ways in which one
person or group should interact, deal and behave with another person or group. Organizational ethics
are a product of societal, professional, and individual ethics. Ethics is the study of morality (right and wrong) and the choices people make in their relationships with
others. Leaders deal with numerous ethical issues in organizations including power, moral standards,
moral consistency, moral mistakes etc. Different approaches have been suggested for dealing with these
issues, such as following universal moral laws, greatest good for the greatest number, having a primary
concern for others’ welfare, promoting high moral character in leaders, and persistently striving to be
just, prudent, and truthfulness in one’s behavior. Creating an ethical organizational climate requires
leaders to have and present role model ethical behaviors, and reward ethical policies and practices,
punish unethical behavior, discuss ethical assumptions and practices, and use
charismatic/transformational leader behaviors in a socially responsible manner. Many leaders are
turning to spiritual/religious practices to help them deal with ethical issues.
Ethics is the study of morality (right and wrong) and the moral choices people make in their
relationships with others.
A. Ethics concerns how we should behave in the roles that society gives us.
B. Leaders are often in roles that can determine the well-being of others and they sometimes
influence the broader good.
o Technically good (effective)
o Morally good.
Ethical values rest on principles stressing the importance of treating everyone fairly and equally. To
make ethical decisions, an organization purposefully implants ethical instrumental values in its culture.
Ethical values are a product of societal, professional, and individual ethics.
o Ethics
– Is a derivative of the Greek word ethos, meaning customs, conduct, or character
– Is concerned with the kinds of values and morals an individual or society ascribes as
desirable or appropriate
– Focuses on the virtuousness of individuals and their motives
o Ethical Theory
– Provides a system of rules or principles as a guide in making decisions about what is
right/wrong and good/bad in a specific situation
o Ethics & Leadership
o What leaders do and who leaders are is determined by the nature of the leaders’
behavior and their virtuousness.
o What choices leaders make and how they respond in a particular circumstance are
informed and directed by their ethics.
Ethics is…
o Ethics is the study of morality
o Central principles of ethics:
o Reversibility – Would you want someone to do this to you?
o Universality – Would you want everyone to do this?
o Other questions
o Am I treating others with respect?
o Am I violating the rights of others?
o Am I treating others only as a means to my own ends?
o Am I being honest with others and with myself?

Ethics is…
o Right vs. Wrong
o Also known as your conscience/principles
o Usually a spontaneous decision
_ You instantly know right from wrong
o Brainstorming exercise
_ list of “wrongs”
_ List of “rights”
o Who you are when no one is looking
o If your mom & dad were watching, would you still do it?

Ethics is…
o Ethics vs. Morals
Ethics and morals are NOT always the same
Morals = personal view of values
o i.e. beliefs related to moral issues such as drinking, gambling,
o Can reflect influence of religion, culture, family and friends
Ethics = how a moral person should behave
o Ethics go beyond cultural, religious, and ethnic differences
Ethics is not about “getting caught”
o Even if you get away with something, it may still be unethical
o Ethics is not defined by what happens to you, but by your thoughts and actions
Ethics is not about placing blame
o Do not judge other’s based on their personal beliefs
Ethical behavior is the display of moral attributes
o Judgment
o Behavior
o Self-discipline
o Character
However, what “ethical behavior” really boils down to in its simplest form is: Knowing the difference
between right and wrong and behaving accordingly
Character Traits Reflect Ethics:
o Honesty
o Courage
o Compassion
o Even-handedness (impartiality)
o Respect for Others

Some Common Ethical/Legal Issue:
o Conflict of Interests
o Confidentiality
o Use of Position for Personal Gain
o Personal Contracts
o Outside Employment
o Personal Investments
o Use of Government Time
o Behavior On Duty and Off Duty
o Discriminatory Practices

Why Be Ethical?
o What benefits do you receive by acting ethically?
o Character Counts
o Self-respect
o What benefit does the community receive?
o Challenges to acting ethically:

o If it’s necessary, it’s ethical
o If it’s legal, it’s ethical
o I was doing it for you
o I’m just fighting fire with fire
o It doesn’t hurt anyone
o Everyone’s doing it
o It’s okay as long as I don’t gain personally

How to Be an Ethical Person?
o Do no harm
o Avoid causing physical, mental, or emotional harm
o Benefit others
o Offer assistance and improve the lives of others, even if it may inconvenience you
o Be just
o Treat everyone equally or Follow the Golden Rule
o Be faithful
o Keep promises, tell the truth, be loyal, and maintain respect and good manners
o Respect autonomy
o Everyone has the right to decide how they live their lives, as long as they do not interfere with the
welfare of others

Respects Others:
Treat others as ends in themselves and never as a means to ends
o Treat other people’s values and decisions with respect
o Allow others to be themselves with creative wants and desires
o Approach others with a sense of unconditional worth and value individual differences
o Leader behaviors
Listens closely to subordinates
Is empathic
Is tolerant of opposing viewpoints

Serves Others:
Follower-centered - Based on the altruistic principle of placing followers foremost in the leader’s
o Beneficence - Leaders have a duty to help others pursue their own legitimate interests and
o Leaders are stewards of the organization’s vision; in serving others they: clarify, nurture,
and integrate the vision with, not for, organization members
o Leaders have an ethical responsibility to make decisions that are beneficial to their
followers’ welfare
o Leader behaviors
Mentoring behaviors
Empowerment behaviors
Team building behaviors
citizenship behaviors

Shows Justice:
Ethical leaders are concerned with issues of fairness; they place issues of fairness at the center
of their decision making
o Leader behaviors
All subordinates are treated in an equal manner
In special treatment/special consideration situations, grounds for differential
treatment are clear, reasonable, and based on sound moral values

Manifests Honesty:
Honest leaders are authentic but also sensitive to the feelings and attitudes of others
o They are not deceptive
o They tell the truth with a balance of openness and candor while monitoring what is
appropriate to disclose in a particular situation
o Leader behaviors
Don’t promise what you can’t deliver
Don’t suppress obligations
Don’t evade accountability
Don’t accept “survival of the fittest” pressures
Acknowledge and reward honest behavior in the organization

Builds Community:
Concern for the common good means leaders cannot impose their will on others; they search
for goals that are compatible with everyone.
o Concern for others - Is the distinctive feature that delineates authentic transformational
leaders from pseudo-transformational leaders
o Transformational leaders and followers reach out beyond their own mutually defined goals
to the wider community
o Leader behaviors
Takes into account the purposes of everyone in the group
Is attentive to interests of the community and the culture
Does not force others or ignore the intentions of others

Leading with Integrity:
“Management is doing things right; leadership is doing the right things”.
– Peter F. Drucker
“Leadership always comes down to a question of character”.
– Warren Bennis

Key Questions
o What is ethical leadership?
o How do I lead with integrity?
o What can I do to strengthen the ethical culture of my organization?

Ethical issues
o The basis for a leader’s influence on followers
o The more power a leader has, the more likely that followers will comply with the
leader’s wishes
o The greater a leader’s power, the greater the potential for abuse
o Corrupting influences of power
o Power may become desired as an end in itself and be sought at any cost
o Power differences may cause followers to give the leader false positive feedback and
create an elevated sense of self-worth on the leader
o The leader may devalue followers’ worth and to avoid regular contact with followers
or mistreat them
o A leader’s failure to acknowledge the ethical limits of power causes a loss of credibility and
trust and does devastating damage to the leader and his constituency
o Moral standards for a leader’s behavior
o Should leaders be held to a higher moral standard?
o we would probably have a shortage of leaders
o we would most likely become disillusioned with them when they were unable to meet
the higher standards
o Should leaders be held to the same standards as everyone else, and be expected live up to
those standards.
o Moral consistency
o If leaders’ behavior does not match their stated values, they will lose the trust of their
followers and colleagues
o a leader’s moral inconsistencies are open to public scrutiny
o Leaders who do not behave consistently with their stated ethical values risk being labeled
o The relationship between ethics and effectiveness
o Leaders sometimes achieve worthwhile goals using questionable tactics.
o Existence of a double standard when judging some leaders.
o Judging a leader as “good” involves complex assessments of the leader’s achievements and
the means used to reach those achievements.
o Leaders also make moral mistakes that cause unfortunate consequences, although their
intentions were ethical.

Approaches to Ethical Behavior
o Categorical Imperative -- obligation ethics. Specifies that individuals should always do what is
right, regardless of the consequences
o Utilitarianism, -- consequential ethics or ethics of responsibility. Ethical decisions must be based
on their consequences.
o This approach maintains that we should behave so as to create the greatest good for the
greatest number of people
o Identifying all the relevant consequences of a decision can be difficult, especially when
leaders represent diverse groups or when their decisions have far reaching effects
o Altruism
o Altruistic leaders are concerned for the welfare of others and their actions are designed to
help others even if it results in a cost to themselves
o Confucius equated altruism with the golden rule “do unto others as you would have them
do unto you”
o Virtue ethics. The central idea of virtue ethics is that leaders and other individuals who have high
moral character are most likely to make wise ethical choices in their behavior and decision making.
o virtues are “deep-rooted dispositions, habits, skills, or traits of character that incline
persons to perceive, feel and act in ethically right and sensitive ways”
o Advocates of virtue ethics tend to describe the character traits and qualities of the ideal
leader as an ethical role model.
o Moral Learning. Involves gradual changes in beliefs, attitudes, values and habits obtained through
prolonged effort by a leader to behave in a just, prudent and truthful manner. Moral learning is a
process of human development
o a positive process that causes leaders to want to create benefits for people
o causes leaders to make decisions and act in accordance with their conscience
o Moral learning focuses on an ethic of excellence
o teaches leaders to strive for a higher good and to take the “most ethical” approach, even if it
is costly in terms of the leader’s personal preferences, income, career, or the welfare of
other stakeholders
o Elements of moral learning
o Leaders must first become sensitive to ethical problems.
o Leaders must also become competent in making moral judgments
o Leaders must be motivated to behave ethically and to make ethical decisions
o Leaders must be willing to take moral action
o Sources of moral learning
o role models
o hardships
o a value driven mission

Ethics Management Tools
o Exemplary leadership
o Ethics training
o Codes & Oaths
o Audits

Ethical Leaders
o Are ethical role models
o Sustain an ethical climate that creates trust
o Promote the ethical development of their subordinates
o Ethics Training
o Types
_ Compliance training
_ Values training
o Effectiveness
o Codes
o Implement codes of conduct.

Ethics - Where to Start? A Code of Ethics

Types of Codes of Ethics:
o Two Basic Types
o Compliance Based
o Integrity Based

Qualities of Leadership
o Two Goods
o Morally Good.
o Technically Good.
o Self-knowledge.
o Self-control.
o Confidence.
o Charisma.
o Consistency.
o Effectiveness.
o Humility.
Leadership is a process whereby an individual inspires a group to achieve a common goal by the power
of their integrity and wisdom.

Becoming a Wise and Ethical Leader
o Read, Read, and Read
o Think broadly and deeply about ethics
o Set an appropriate ethical example
o Make serving others (not your career) your top priority
o Lead from trust and respect, not power & authority
o Delegation and shared responsibility
o Listen to and facilitate others
o Find a mentor and be a mentor
o Bottom Line
o Are your people growing as effective leaders themselves?

Creating an Ethical Climate
o The ethical climate of an organization is the shared perceptions among organizational
members of the organization’s policies, practices and procedures regarding ethical
o Specific actions by leaders also contribute to this ethical climate.
o Role modeling
_ Emphasize visible behaviors and include demonstrations of how to implement
specific values.
o Directive behavior
_ clearly specify ethical policies and practices through organizational codes of ethics,
continuing education and training on ethical issues,
_ implement internal ethics committees to respond to employees’ concerns and
_ insure regular coverage of ethical issues in the company communications
o Contingent reward and punishment behaviors
_ reward individuals and groups who accomplish goals by acting in ways that are
consistent with organizational values
_ identify and reward organizational citizenship behaviors
o altruistic behavior – going out of their way to help other employees
o conscientiousness –doing a better job than expected
o courtesy –giving advance notice of upcoming projects
o civic virtue –regular attendance and active participation in meetings
o sportsmanship –not complaining and not making mountains out of mole
o discipline employees who fail to adhere to company values
o Participative leader behavior
_ ethical leaders provide forums for dialogue and discussion of ethical assumptions
and practices in the organization
o understanding different ethical approaches helps people assess their own
and others’ behavior, and knowingly select ethical courses of action
o discussing sound ethical actions or decisions can also provide useful
reference points for organizational members
o involving followers in discussions of real ethical incidents in the
organization encourages everyone to examine organizational responses and
processes and makes ethical assumptions and approaches clearer to
everyone involved
The number one rule - which is commonly echoed in all management courses - is: “Lead by example.”
To create an ethical team/organization every member need to make sure the compliance of ethical
behavior but main responsibility rest on leader to exhibit ethics and also make sure that others do the

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