What are the two components of ethical leadership?

1. Career development
2. How To Improve Ethical Leadership Skills (With Examples)

By Indeed Editorial Team

Updated July 20, 2022 | Published December 12, 2019

Updated July 20, 2022

Published December 12, 2019

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

This article has been approved by an Indeed Career Coach

 

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Ethical leadership demonstrates a high regard for values. The principles of ethical leadership include honesty, justice, respect, community and integrity. Ethical leadership is critical to the success of any business.

In this article, we define and provide examples of ethical leadership, as well as detail how to improve and highlight your ethical leadership skill set.

What is ethical leadership?

Ethical leadership is leadership centered around appropriate conduct through respect for ethics and values, as well as the rights and dignity of others. The concepts of honesty, integrity, trust and fairness are all critical to ethical leadership.

Ethical leadership can provide value to businesses by inspiring employees to be motivated and live up to the company’s values. Experience suggests that ethical leadership leads to greater employee satisfaction and lower turnover rates.

Ethical leaders should demonstrate ethical and appropriate behavior in every facet of their life over time, even when their behavior is not necessarily observable by their employees. Ethical leadership may even occasionally be unpleasant, for example when it involves terminating an employee who uses company property for personal ends. Nevertheless, maintaining your integrity is of paramount importance to leadership.

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Ethical leaders also work to create an ethical work culture. This means that a work environment is governed by a fair, clearly articulated set of rules, rather than by personality or politics. In an ethical work culture, an organization’s management articulates a set of principles that are understood, and bought into, by everyone in the organization. Every element of the business—from performance reviews and mentoring to compensation—reflects the ethical principles that are articulated from the top.

Principles of ethical leadership

Practitioners and scholars of ethical leadership point to five key principles of ethical leadership:

Honesty

Dishonest behavior is a form of lying or misrepresenting reality. Dishonest behavior by leadership creates an atmosphere of mistrust and can lead to leadership being seen as not dependable. People will lose faith in dishonest leadership. As a result, ethical leaders must behave with honesty.

Justice

Ethical leaders are also concerned with issues of justice and fairness. These types of leaders prioritize treating everyone in an equal manner and placing justice and fairness at the center of their decision-making more broadly. They make a rule of never giving certain individuals special treatment, except when a particular situation demands it for justice.

Respect

Leaders who convey respect to their peers and employers approach others with an inherent sense of their worth and value as individuals. Respect means listening carefully to others and confirming their inherent value. Leaders should also mentor others to become aware of their purpose, values and needs so that ethical qualities spread throughout the organization.

Community

Ethical leaders behave with altruism. They place the welfare of their subordinates high in their esteem, and engage in activities like team building, mentoring, and empowerment behaviors. This means ethical leadership helps to build community. These leaders take into account the values and purpose of their employees as well as of the organization as a whole.

Integrity

Integrity refers to the quality of having a strong moral purpose and being honest. Ethical leaders demonstrate appropriate values to those around them via their behavior. Leaders who act with integrity can strengthen the organization by attracting talented, ethical hires. People generally want to work for leaders they perceive as acting with integrity. Investors and customers feel the appeal of leadership that acts with integrity and are more likely to be attracted to those organizations.

Ethical leadership examples

There are several types of ethical leadership behaviors you can practice to develop this soft skill in different settings:

Set an example

Ethical leadership is about walking the walk as much as it is about talking the talk. Ethical leaders have high expectations for their employees, and they hold themselves to the same standards. Leaders also expect other members of their team to lead by example.

Publicly champion the importance of ethics

Ethical leaders focus on the importance of ethical standards and work to educate their teams and peers about their importance. They seek to integrate these values into every facet of their team and company.

Communicate ethics

Ethical leaders need to be good communicators. They should become comfortable speaking in public, leading meetings and writing communications that clearly articulate what they are trying to convey. Good relationships between leaders and their teams are built on fairness, integrity, and trust. Ethical leaders are effective at building these relationships via communication.

Make decisions based on values

Ethical leaders assess each decision before implementing it to make sure that the decision accords with the organization’s mission and values. They will only initiate such decisions if the ethical criteria are met.

Be aware of values

Ethical leaders are aware of their values and the expectations that they place on themselves and their employees. They also communicate these values clearly so that they are widely understood by everyone in an organization.

Establish zero tolerance for ethical violations

Ethical leaders do the right thing at all times—not just when it is convenient or someone is watching—and they hold their employees to that same standard. For this reason, they cannot tolerate any sort of ethical violation. Implementing a zero-tolerance policy helps convey the leader’s expectations of themselves and others.

Practice justice and respect

An ethical leader should always behave with fairness and respect for others. They do not play favorites. They treat peers and employees in an egalitarian way regardless of the employee’s age, gender, nationality, ethnicity or any other factor that could prompt unfair treatment. Ethical leaders demonstrate respect for team members by listening attentively, being compassionate, considering opposing viewpoints fairly and valuing their contributions equally.

Hire ethical employees

Ethical leaders need to establish common ground with their team, whether or not they have precisely the same ethical values. This starts with the hiring process and is maintained throughout an employee’s time at a company by the organization’s vision statement and ongoing training.

Ethical leaders consciously work to hire employees who are aligned with the leader’s and the company’s values, as well as those who possess the right skill set and experience for the job. They seek to maintain a respectful and diverse work culture where employees are aligned around particular ideals and values. It can be helpful from an ethics standpoint to assemble a team with diverse backgrounds and experiences that will bring different things to the table.

How to improve your ethical leadership skills

You can improve your ethical leadership skills with time, attention and practice. Start by identifying your strengths in ethical leadership and then build a plan to improve from there. Following these steps will improve your ethical leadership skill set:

1. Identify potential “trigger” situations

Identify situations such as hiring, firing, purchasing or promoting that seem to attract ethical dilemmas at your company or elsewhere. Recognizing when ethical dilemmas are likely to arise can help you be more attuned to the risk and to think carefully about how to behave with integrity.

2. Deal with ethical dilemmas when they arise

Identifying potential dilemmas is one thing, but dealing with them when they arise can be more difficult. There are a few steps you can take to deal with such dilemmas:

• Prepare in advance: Visualize how you might respond to theoretical scenarios so you can think about the ethics of such instances ahead of time. In a crisis, you may have less time to make a decision, so this kind of rehearsal can be helpful.

• Assess the evidence: Whenever possible, take time to carefully weigh all of the information you receive about a situation. Assess whether someone has taken an unethical action before you react.

• Get advice: It is often helpful to talk through an ethical dilemma with a friend, mentor or even a spiritual advisor. Assessing advice rationally can help you to make important ethical decisions.

3. Demonstrate courage

Sometimes you will need to make a decision that will leave you wondering afterward whether you did the right thing. Even when you do know that you made the right choice, you or your team could suffer unpleasant effects as a result even of an ethical decision. For example, if you learn of irregular accounting in your firm and inform an auditor, this could lead to someone being fired. Even though you know that the decision you made was correct, it might be painful to see someone lose their job.

However, this type of situation can help you to learn to trust your instincts, release your anxiety and assess each situation logically rather than emotionally.

The importance of ethical leadership

Ethical leadership can have positive effects on a business environment at three levels:

Importance to the individual

At the individual level, ethical leadership can help maintain a positive work environment for each individual. Ethical leaders can inspire employees to follow their example. Positive communication among co-workers as a result of ethical leadership can in turn influence productivity and improve each individual’s attitude in the workplace.

Importance to the team

Ethical leadership can also improve team dynamics and overall morale within the unit. Ethical leaders help team members to communicate and get along with one another, which in turn affects the team’s performance. Strong ethical leaders set an example for their team.

Importance to the organization

Finally, the overall health and well-being of an organization can be deeply affected by ethical leadership. The leaders should foster an environment of collaboration and mutual respect, one that allows individuals to grow and contribute to the organization’s overall goals.

How to highlight your ethical leadership skills

Ethical leadership is an important leadership skill that can help in all aspects of your career. When a leader and their company consistently do the right thing, employees will be aware of the foundations of their leadership. Management’s actions convey to the rest of the company that the leaders act with integrity. This, in turn, means employees will be more proactive about communication, including when things go wrong.

Additionally, ethical leadership skills can be very attractive for hiring managers. Highlight your ethical leadership skills when you are applying for new positions. For example, in an interview, you can convey specific examples of times when you acted with integrity in the workplace.