Ethical Leaders Must Lead by Example
One characteristic of ethical leadership is to influence others. Management expert John Maxwell characterizes leadership this way: “A leader knows the way, goes the way, and shows the way.”
The ethical leader understands that positive relationships built on respect, openness, and trust are critical to creating an ethical organizational environment. The underlying principles of ethical leadership are integrity, honesty, fairness, justice, responsibility, accountability, and empathy.
Focus Of Ethical Leadership
Dr. Elder Richard Dixon posts on LinkedIn that the recent number of scandals, public corruption, and criminal conduct by publicly elected officials and executives in private enterprise in the U.S. and the global community demonstrates a need for more focus on transparency, accountability, and ethical principles governing conduct and behavior. Ethics and leadership in many respects are an oxymoron because the terms are being used to justify corrupt behavior.
Principle-Centered Leadership
Covey addresses a principle-centered leadership approach to one’s personal life and organizational development. He emphasizes that principle-centered leadership occurs when one’s internal values form the basis of external actions. Principle-based leaders influence the ethical actions of those in the organization by transforming their own behavior first. Covey encourages principle-centered leaders to build greater, more trusting and communicative relationships with others in the workplace.
Ethical leaders strive to honor and respect others in the organization and seek to empower others to achieve success by focusing on right action. An ethical organization is a community of people working together in an environment of mutual respect, where they grow personally, feel fulfilled, contribute to the common good, and share in the internal rewards, such as the achievement of a level of excellence common to a practice, as well as the rewards of a job well done. By emphasizing community and internal rewards, ethical leaders commit to following a virtue-oriented approach to decision making based on a foundation of values-based leadership.
Leaders should lead by example. They set an ethical tone at the top. They lead with an attitude of “Do what I say as well as what I do.” Ethical leadership can be evaluated through a leader’s vision: Visions are not simple goals, but rather ways of seeing the future that implicitly or explicitly entail some notion of the good.
The 6 Main Principles of Ethical Leadership
Harvard University’s Executive and Professional Program address the six main principles of ethical leadership as follows.
- Respect
Respect includes valuing others’ skills and contributions. Mutual respect leads to healthier workplace relationships where both sides appreciate and support what the other is doing and feel secure in talking through issues and challenges. Healthy relationships create positive work environments, which drives increased productivity.
- Accountability
Ethical leaders hold themselves accountable for their actions. They make decisions based on integrity and stand behind their work. They also lead by example, communicate openly about challenges, and don’t look to place blame on others for any shortfalls.
- Service
Leaders make ethical decisions based on doing what is right for employees, customers, and the community. Because these constituents are always top of mind for ethical leaders, they often have a strong sense of service.
- Honesty
To build and maintain trust, leaders must be good communicators who speak openly and honestly about issues. Regardless of the issue’s severity or unpopularity, leaders’ responsibility to be clear and candid and empower others to make the right decisions with the information they have.
- Justice
Justice is not just about following the law, but about ensuring that everyone is getting what they deserve. Ethical leaders approach situations with a focus on treating everyone fairly, and they expect their teams to treat each other and customers the same way. Through their actions, they build equitable work environments where everyone feels respected.
- Community
Ethical leaders view their companies as communities and consider everyone involved when evaluating situations and making decisions. By viewing their organizations this way, they build equity and inclusion into their decision-making process and create work environments that encourage collaboration across teams.
Ethical Leaders and Compliance
The Ethics and Compliance Initiative (ECI) point out that research has consistently shown that:
- Ethical leadership is a critical factor driving down ethics and compliance risk.
- Leaders have a ‘rosier’ view of the state of workplace integrity and often have more positive beliefs than employees further down the chain of command.
- The quality of the relationship between supervisors and employees goes a long way in creating an ethical culture.
The ethical leadership scale helps to measure the elusive concept of leadership. It includes several behavioral characteristics of ethical leaders:
- Talk about the importance of workplace integrity and doing the right thing
- Set a good example
- Do not blame others when things go wrong
- Support employees’ efforts to do the right thing
- Hold themselves and others accountable for violating the organization’s code of conduct
- Give positive feedback for acting with integrity
- Keep their promises and commitments.
Framework for Ethical Decision-Making
Lawton and Paez developed a framework for ethical leadership built on three interlocking questions: First, who are leaders and what are their characteristics? Second, how do ethical leaders do what they do? Third, why do leaders do as they do, and what are the outcomes of ethical leadership?
The authors suggest that the three factors will not necessarily form discrete areas of ethics. For example, auditors need to be virtuous and exhibit the characteristics of honesty, integrity, objectivity, and professional skepticism. These traits are also essential in auditors’ relations with clients because they enable professional judgment and ethical decision-making in client relationships. They also facilitate the kind of probing audits and targeted inquiries of management that should be conducted selflessly and in the public interest, not that of the client or even self-interest.
Where Have All the Leaders Gone?
What’s missing in the U.S. right now is ethical leadership. In fact, it’s not even on the radar of most of our leaders. We live in a time where it’s almost impossible to identify role models. Most leaders are all too willing to compromise their values to achieve some goal. It’s an end justifies the means culture.
Ethical leadership in business has become a serious problem. The ethics of managers can vary widely based on individual values and organizational culture. Organizations suffer when leadership does not set an ethical tone at the top. The employees may be ethical, but acting ethically requires an ethical leader who supports such behavior, not a leader blinded by ambition or greed, as occurred in so many of the financial failures of the early 2000s.
Blog posted by Steven Mintz, PhD, professor emeritus from Cal Poly San Luis Obispo, on June 11, 2026. Visit Steve’s website to learn more about his activities.