Ethical Leadership

For twenty years the Ethics Resource Center has been publishing the National Business Ethics Survey (NBES) and related studies that provide information about trends in workplace ethics and identify strategies to improve ethical workforce behavior. Not surprisingly, there is a strong link between management behaviors and employee conduct.

The latest study, based on an analysis of NBES data over time, makes that point clear. As the study’s title indicates, every leader sets a tone for ethical leadership. It is up to the leader and the leadership team to decide what tone they choose to set.

A notable finding is that the most significant factor in ethical leadership is employees’ perception of their leaders’ personal character. Leaders who demonstrate they are ethical people with strong character have a much greater impact on worker behavior than deliberate and visible efforts to promote ethics. In addition, workplaces in which leaders display ethical leadership tend to have lower rates of misconduct, less pressure to break rules, and greater employee engagement (ERC, 2014).

According to the ERC, the data shows that workers judge leaders on three factors:

1) The overall character of their leaders as experienced through personal interactions

For example, do leaders treat all employees with respect?  Do they share credit when good things happen?  Do they uphold standards even if it reduces revenues and profits?

2) How senior managers handle crises

For example, are leaders steady in a crisis?  Do they hold themselves accountable or do they shift blame to others?

3) The policies and procedures adopted by senior leaders to manage the company

For example, in day-to-day management, is ethical behavior recognized and rewarded or does praise and promotion go to those who bend the rules?

The study also found that first-line managers and supervisors are equally influential; they are judged by the same factors and employees are influenced by their personal character as well.

The assessment of personal character goes beyond the workplace; how leaders behave outside the office has a similar influence. As the study concludes, “ethical leadership is a 24-7 job.”

Ethical Advocate provides 24-7 support for confidential, secure, and anonymous ethics hotlines and also provides related ethics and compliance training. Contact us to learn more.


Ethics Resource Center.  Ethical Leadership:  Every Leader Sets a Tone.  December 2014.