6 Key Traits of an Ethical Leader

In our fast paced, always-on world, the blaring assault of emails, social media and the inescapable fear of missing out connects, reveals and exposes us like never before. But the world is not just faster; it’s been reshaped. It has become interdependent, because so few can now so easily and so profoundly affect so many so far away.

However, interdependence comes with its own unique implications for leaders—the need for values and behavior. With this critical context, the most important trait of ethical leadership is the ability to stop and think. A pause provides a fortress of composure amid the chaos of our constant activity, allowing us to make sense of all the stimuli, differentiating and determining an appropriate response.

“Ethical leaders understand that the first step to engendering trust is to extend it, not to inspect for it.”

Pausing sharpens our awareness—as well as our consciousness. Active pausing is at the heart of ethical decision making because it defends against knee-jerk, reactive behavior. In pausing, we reflect on our values, work and lives and how our behaviors affect other people.

However, stopping and thinking is only one piece of the puzzle. Here are five other key traits of an ethical leader.

1. Extend trust. Aristotle taught us that the virtue of trust lies in giving it away. Ethical leaders understand that the first step to engendering trust is to extend it, not to inspect for it. Inspecting with suspicion only breeds more suspicion. Trust, on the other hand, begets trust. Extending trust fosters a positive, collaborative relationship where that trust is returned, allowing us to rely on each other, form teams and divide labor.  

When the late Nelson Mandela became the President of South Africa, he trusted his people with the truth—a new, integrated nation was something that needed to be worked toward and wouldn’t happen overnight. Mandela’s faith in his people created a space of hope that inspired others to make that vision a reality. Offering others the truth, rather than sugar-coated niceties, demonstrates respect for and confidence in the other party. It allows them to rise to the occasion.

2. Have two-way conversations. The famous “It’s my way or the highway” mantra is no longer applicable. Ethical leaders have respectful, two-way conversations, where they engage directly with colleagues, customers and other stakeholders.

Taking actions without getting input just doesn’t work anymore, something Netflix learned the hard way in 2012 when it split its subscription services and increased membership fees. The move drove away 800,000 subscribers, who felt betrayed because they hadn’t been consulted. As a result, Netflix and its CEO Reed Hastings had a true “stop and think” moment, apologized for the mistake and embarked on a genuine journey of sincere change.

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.

" Dov Seidman : 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."