Ethics matters a great deal in business.
MBA Graduates often carry great power – and as a result great responsibility – on their shoulders. Before they head into the C-suite, someone has to teach them how to keep that power in check and refrain from letting it go to their head. Ultimately, leaders of organizations should be models of positive behavior.
Over the years, many people have debated whether business schools should carry the burden of teaching ethics to their students. Some argue that graduate business school students, who tend to be older, have already developed their own sense of morality. There’s no changing them now. But I disagree. (See my blog, “The Importance of Teaching Ethics at Business School.”)
Business professors can give students a framework for deciphering between right and wrong. Indeed, we should think of ethics as yet another skill in the toolbox of an MBA (or anyone with power for that matter). That’s why I am sharing these suggestions on ways to be an ethical leader:
Weigh the consequences of your actions
Certainly, business school students should learn how to make decisions in an ethical manner. In other words, they should consider the implications their plans have on the bottom line, but also the greater society. Many case studies at top business schools ignite the kind of debate that will spark such deliberation.
For example, a professor might bring up a case of a pharmaceutical company’s pricing strategy for a life-saving medication. Executives must consider all the usual aspects of deciding what to charge for a product. But if the medication is too expensive, some people who need it might not be able to afford it. In that case, price could influence who gets to live and who dies. Therefore, the decision makers at that company must not only think of their earnings. After all, their business serves more than one purpose; it’s not just about the money.
Consider the opinions and suggestions of others
Of course, the boss is the ultimate decider. If you’re the CEO or the top executive in your department, then you have to be willing to call the shots. But wise leaders take into consideration the advice of others and all the available data, so they can make informed decisions. They should keep an open mind about the opinions of those with whom they traditionally disagree.
Just think about the halls of government in democracies. The leader always has a board of advisors to help make big decisions on the economy, war and peace, the environment, matters of public safety, education, and so on. Ideally, these governments are made up of two or more political parties that must find ways to compromise and work together to enact and enforce the rule of law.
Your gut may serve you well. Also, your passionate stance for one side or the other might win you followers. But only after you have all the facts and expert opinions in front of you can you make an informed decision for the greater good. An ethical leader always seeks and finds as much information about a problem as possible for that very reason. Nowadays, every inch of data you could imagine is within reach, making it easier than ever to make the most responsible decisions possible.
Share credit when appropriate
Sometimes, being a good leader means knowing when to follow someone else. If you do your job well, you should inspire creativity and the generation of brilliant ideas in others. Then, you should give them credit. Send out an email to the staff and call out those deserving of applause. Throw a party. Seriously. Or at least pat the successful team or person on the back every now and then.
Too often, leaders let their staff make them look good and never give them credit. At best, it is an oversight. At worst, the executive is fine with taking credit for someone else’s work, which is akin to plagiarism. Spreading the love is not just the right thing to do; it also boosts morale by helping employees feel appreciated and part of the company’s success.
Be transparent and compliant with law
You would think this was obvious. But time and again presumed leaders make headlines for violating the law. In 2017, in fact, 11 companies paid more than $1.92 billion to resolve cases of the U.S. Foreign Corrupt Practices Act (FCPA), which is an anti-bribery law.
Sometimes, people who gain power see shortcuts and take chances in the name of greed. Eventually, it catches up with them. The most egregious case in recent history is Bernie Madoff, whose Ponzi scheme cost investors billions. While there are practical reasons for following the law, such as avoiding violations and scandal, it is also a question of morality. Those who have studied Madoff have to wonder if he ever had any scruples.
Certainly, a bad guy who goes to business school will be a bad guy who graduates business school. But most people possess a sense of morality. They might just need guidance and an education in the regulations by which they must abide.
Offer constructive criticism
The stereotype of the MBA is a loud-mouthed, abrasive boss. Who says you have to be mean to be a leader? While you can’t be a pushover, you should have good manners. Respect everyone in the office – from the board of directors to the custodian. Give direction and disagree with people without raising your voice or undermining their opinion. Be secure in your own intelligence. Give people the chance to shine as opposed to micromanaging them. Rather than name calling, you should offer constructive criticism to help them improve their skills. Your aim should be to get the best out of everyone. You can be nice and still get stuff done.
Hold people accountable
Being nice is one thing. But the leader sets the tone for everyone else. As a result, you cannot tolerate boorish or inappropriate behavior, poor communication, ineptitude, or illegal acts on the part of your employees. Being ethical isn’t always easy. You might have to fire or suspend people. Or you might have to reprimand them. The point is that you must hold people accountable and serve as the moral compass for the company. Most importantly, you must hold yourself to the highest standard. This is both to serve as a role model but also to create the culture of the place.
What separates us humans from the robots – and will keep us employed long after AI takes over – is our ability to empathize. We can share and understand the feelings of fellow men and women. That is our superpower, and we should use it wisely. As a leader, you should use empathy in your decision-making. It comes in handy as you develop relationships with employees and clients. In other words, be like a boss and never forget your humanity.