Lecture Notes: Ethical Leadership and Unethical Behavior

Introduction

• Presentation based on personal research and popular press articles.
• Aimed at leaders and focuses on unethical behavior.
• Call to action for leadership in organizations.

Prevalence of Unethical Behavior

• Harvard Business Review study: 98% of employees report unethical behavior at work.
• Unethical incidents have doubled from 1998 to 2011.
• Forms of unethical behavior: Bullying, undermining, forced compliance.

Impact on Performance

• Unethical behavior affects individual and organizational performance.
• CEOs and executives spend a significant amount of time dealing with unethical conduct.

Legal vs. Ethical Liability

• Most unethical behavior is not illegal.
• Eric Holder: Financial crisis behavior was unethical but not illegal.
• Less than two dozen senior leaders implicated in 14,000 cases.

Crisis in Leadership and Culture

• Focus on higher education.
• Legal liability is a low hurdle; ethical liability is more challenging.
• Ethical liability tests character more than legal liability tests intelligence.

Unethical Leadership

• Common form: Allowing unethical conduct to continue.
• Unethical leadership breeds unethical cultures.

Case Studies in Higher Education

• Examples: Penn State, Rutgers, Ohio State, North Carolina, etc.
• Patterns of unethical behavior are institutionalized.
• Not a sports culture problem, but a higher education culture problem.

Causes of Unethical Culture

• Leaders delegate ethics; no intervention leads to escalation.
• No consequences for leaders maintaining unethical cultures.
• Leaders often protected by their reputation, hubris, or lack of accountability.

Antidotes to Unethical Culture

• Do not tolerate unethical conduct towards employees.
• Codes of ethics require leaders to model ethical behavior.
• Celebrate compliance and address non-compliance.

Conclusion

• Legal does not equate to ethical.
• Ethical leadership builds character and organizational quality.
• Call to action for leaders to rise to the ethical liability challenge.

Questions to Ponder

• How is knowing and doing nothing different from condoning unethical behavior?
• What about the leaders where you work? Is there a consequence to long-term leadership?

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Final Thoughts

• Legal standards are a minimum; ethical standards are crucial for true leadership.
• Reflect on personal leadership and the culture of your organization.