Ethical leadership is more important now than ever, in order to remain in command, lead the company and employees in a good position and overcome crises.
If you want to last a long time as a corporate leader, especially as a CEO or another powerful player in the C-suite, then mind your code of conduct. Remain accountable and adhere to the highest standards of integrity, and do not merely relegate what you learned in your ethics class to your memories of business class.
This is the advice given by Entrepreneur, which reported on the CEO study made by Strategy&, an arm of PwC. Strategy&’s 2016 CEO Success Study highlights the fact that the number of top-ranking leaders who had been fired for a lapse in moral and ethical values has risen by 36 percent in the past five years. A thorough look at 2,500 prominent corporations which had experienced a series of successions during that time frame was done.
About 5.3 percent of the changing of the corporate guard had to do with the CEO literally being fired from his job. The abrupt terminations of these CEOs are traced to serious errors in judgment calls, behavioral flaws or even criminal actions such as but are limited to fraud, inappropriate sexual dalliances, graft and corruption, bribery of public officials and other important shareholders, insider trading, and corporate negligence that has resulted in spoilage of or damage to the environment.
The members of the company such as the employees, their shareholders and partners, and government and media are also increasingly demanding greater responsibility from their CEO’s. This trend started after the subprime economic crisis from 2007-2008 shattered public trust in corporate leadership. Today, a decade later, what is sustaining this demand is a confluence of factors such as more watchful government bodies, relentless media coverage of corporate behavior, and the current business landscape which has closely linked leadership behavior with stock market performance.
Today, a decade later, what is sustaining this demand is a confluence of factors such as more watchful government bodies, relentless media coverage of corporate behavior, and the current business landscape which has closely linked leadership behavior with stock market performance.
The Harvard Business Review also cautions readers that fraudulent leadership decision-making and actions can adversely impact employee behavior. Should an organization’s values be violated or disrespected, 77 percent of its own workforce doubt its credibility, which in turn leads to poor performance and a decline in productivity.