Leadership and Unethical Behavior: How Does It Impact the Organization?

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Nov 27, 2012

So by now we’ve all heard about the scandal with retired general and former head of the CIA, Gen. David Petraeus. Some of my European colleagues have noted that we can be a bit uptight in the U.S. when it comes to mixing business and personal, and that may be the case.

However, as that is the culture in which we live (and lead), those in positions of power need to conduct themselves within certain boundaries. Obviously someone failed to have this conversation with David Petraeus, or with (now) former Lockheed Martin CEO Christopher Kubasik.

As an organizational development and leadership practitioner, I often work with C-level executives as well as with military and civilian leaders. Sometimes the work is focused on them – leadership development and coaching – though often it is focused on the organizations they lead and helping them to improve in one way or another.

Actions have a direct impact on attitudes

Regardless, I often stress to leaders in positions of power that their actions, ethics, values, and behaviors have a direct impact on the attitudes and behaviors of those they lead, and thus, on the organizational culture. That impact can be positive or negative.

As Ken Hultman and Bill Gellerman say in their book, Balancing Individual and Organizational Values, ethics are standards of good/bad or right/wrong behavior, and morals are standards for avoiding or minimizing harmful or bad behavior/wrong behavior.

Thus, a moral is also an ethic, but not all ethics are morals. They are internal to a person.

Organizations as such don’t have values and ethics, but since they are comprised of human beings, their cultures are shaped by the values and ethics of those human beings. If those human beings at the top – leadership – commit unethical behaviors, what kind of message does that send to those they lead?

In the recent cases of David Petraeus and Christopher Kubasik, did their unethical actions have a negative impact on their respective organizations?

Seeing the wisdom of changing your behavior

Kubasik’s actions “did not affect the company’s operational or financial performance,” Lockheed stated. Though damage control has already begun, I think time will tell.

I do give Lockheed credit – they have a written code of ethics for employees, when they found out their leadership violated this code, they forced his resignation. The CIA and the government, on the other hand, have been a bit slower in taking corrective actions.

“Power tends to corrupt, and absolute power corrupts absolutely” – Lord Acton

As an OD practitioner I was once told something by a mentor that still sticks with me today: you may not be able to make people change their values, however, you can help them see the wisdom of changing their behaviors.

As Cameron and Quinn state “An organization’s culture is reflected by what it values, the dominant leadership styles, the language and symbols…” Interviewing 1709 CEOs from 64 countries and 18 industries, (from September 2011 to January 2012). IBM identified that the top organizational attribute to draw out the best from their workforces was ethics and values (65 percent). So what does it say about the culture of an organization when those selected to lead it have somewhat sketchy values and ethics?

Values and ethics are important, and apparently power does corrupt.

“Values (and ethics) are the fuel which drive the engine of desire to make vision a reality…” – Broholm

What kind of reality do you want for your organization?

This was originally published on the Tolero Think Tank blog.

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