6 Key Traits of an Ethical Leader

3. Demonstrate moral authority. Ethical leaders know power isn’t over people, but, through them. To cultivate lasting loyalty and the reach that comes with it, you must unite and enlist others with shared values and a common mission.

In January, Mark Bertolini, CEO of Aetna, took a pause with the book, Capital in the 21st Century by economist Thomas Picketty. In that pause, as he engaged with Picketty’s ideas, Bertolini reconnected with his deepest beliefs about capitalism and reimagined the path ahead for Aetna. Instead of implementing what he thought was correct, Bertolini enlisted his leadership team, and shared copies of Picketty’s book with all of them. Rather than simply seek opinions, he helped frame and catalyze a real conversation about the role of business and capitalism in today’s world. Inspired, they realigned around a more inclusive approach to business for Aetna—“to bring everyone along, not just a few.”

“Ethical leadership requires reconnecting with one’s deepest values and principles and reexamining how one thinks, how one decides and how one behaves.”

As a bold first step in this direction, they raised the minimum wage for all employees to $16. For them, it was simply the right thing to do, but it was also an exercise in moral authority, with the added benefit that it was both the practical and principled thing to do. When leaders like Bertolini unify people around a noble purpose, others follow because they share an investment in a better world.

4. Stand for something and shape context around it. Leaders who want to change their organizations must first change themselves by going on an inward journey. Ethical leadership requires reconnecting with one’s deepest values and principles and reexamining how one thinks, how one decides and how one behaves. This means getting systematic about behavior, reminding others what you stand for and shaping context for them through your behavior.

One leader who understands this is Paul Polman, CEO of Unilever. For the last few years, Polman has devoted himself to the hard work of remodeling Unilever’s supply chain for sustainability, making long-term choices despite short-term costs. One of Polman’s first steps toward reform was doing away with Unilever’s quarterly earnings report, stressing that his vision for Unilever’s future will benefit shareholders, suppliers and the environment in the long run. Now, because he has embedded his beliefs into Unilever’s corporate structure, every employee is encouraged and free to focus on the future.

5. Lead with purpose. More than ever, in a time of ups and downs, success comes as a by-product of pursuing a higher purpose. Operating with purpose connects your actions to significance, and ethical leadership means doing “the next right thing,” not the “next thing right.”

For example, one-third of all Chipotle locations stopped serving pork recently after a supplier failed its animal welfare standards. The firm commitment to Chipotle’s values turned what could have been a short term disaster into long-term positive publicity. Now more than ever, choosing between what’s practical and what’s principled is a false choice, because as Aristotle laid out, the highest good is both practical and principled.

1
2
Dov Seidman is the chief executive of LRN, a company that helps corporations develop values-based cultures and leadership, strengthen their ethics and compliance efforts, and inspire principled performance in their operations. He is also the author of “HOW: Why HOW We Do Anything Means Everything.” Twitter: @DovSeidman