Effective leaders recognize that defining and maintaining ethical standards also requires modeling desired behaviors. This poses challenges in daily operations. Sometimes, moral dilemmas present unique and complicated implications. Combating fraud and bribery requires commitment from leaders and their employees on an ongoing basis. Running companies in an ethically responsible manner typically ensures long-term success by protecting the company’s reputation, avoiding litigation and instilling high standards.


Ethical leadership creates an environment in which people respect each other. Fostering this behavior requires recognizing and rewarding appropriate behavior, not just punishing bad behavior. The challenge lies in reluctance by many leaders to reward people for things they should be doing anyway. These rewards don’t have to be extravagant, though. Personal praise or a note of appreciation goes a long way in reinforcing a company’s core values of honesty and integrity.


Measuring success can be elusive. Ideally, you don't want incidents to occur. It's hard to measure what doesn't happen. Instead, effective ethical leaders encourage the spread of best practices and mandate adherence to making informed choices when the right answer is not necessarily crystal clear. These leaders can measure employee attitudes as one indication of the success of their efforts. For example, by conducting annual employee satisfaction surveys, you can gauge your employees' ability to make the right choice when challenged. Maintaining profitability with honesty and integrity should matter to everyone.


Your employees may think that only executive leaders have responsibility for upholding ethical standards. In fact, though, everyone in your company bears some responsibility for maintaining an ethical workplace. Some employees may be faced with more opportunities to make an impact, but everyone makes a contribution. Publishing a brochure of your commitment to ethical behavior communicates your dedication to customers, stakeholders and the rest of the local community.


Talented employees want to work at institutions with high standards. Leaders with poor reputations and questionable business practices diminish morale and cultivate an environment of distrust. To prevent bad choices, effective leaders create training courses that explain the company’s mission and values and state the standards for business conduct. By mandating that employees complete this training on an annual basis, they ensure that the challenge of upholding these standards remains first and foremost in everyone’s minds. This training should pose dilemmas, such as sharing sensitive company information, giving a competitor a colleague’s email address or accepting gifts and entertainment from suppliers. Require participants to think about the options and choose the ethical action.