Page 96 - Fundamentals of Management Myths Debunked (2017)_Flat

Exhibit 3–3 Being an Ethical leader CHAPTER 3 • Integrative Managerial Issues 95

• Be a good role model by being ethical and honest.
• Tell the truth always.
• Don’t hide or manipulate information.
• Be willing to admit your failures.
• Share your personal values by regularly communicating them to employees.
• Stress the organization’s or team’s important shared values.
• Use the reward system to hold everyone accountable to the values.

The effectiveness of such codes depends heavily on whether management supports them
and ingrains them into the corporate culture, and how individuals who break the codes are
41
treated. If management considers them to be important, regularly reaffirms their content,
follows the rules itself, and publicly reprimands rule breakers, ethics codes can be a strong
foundation for an effective corporate ethics program. 42

etHICAL LeADersHIP. In 2011, Tim Cook was named CEO of Apple Inc. Although it’s an
extremely successful company, Apple is viewed by some as the epitome of greedy capitalism
with no concern for how its products are manufactured. Cook, who was named one of the 100
Most Influential People in Business Ethics by Ethisphere, has increased the company’s focus
on supply chain ethics and compliance issues. It was the first technology company to join the
Fair Labor Association, which means that organization can now review the company’s labor
practices within the supply chain. In addition, at a recent annual stockholders’ meeting with
investors and journalists, Cook, who was challenged by a spokesperson from a conservative
think tank to explain how the company’s sustainability efforts were in the best interests of
shareholders, bluntly and clearly said that Apple wasn’t just about making a profit and that
“We want to leave the world better than we found it.” 43
Doing business ethically requires a commitment from managers. Why? Because they’re
the ones who uphold the shared values and set the cultural tone. Managers must be good
ethical role models both in words and, more importantly, in actions. For example, if managers
take company resources for their personal use, inflate their expense accounts, or give favored Through his words and actions, L’Oreal’s
treatment to friends, they imply that such behavior is acceptable for all employees. CEO and chairman Jean-Paul Agon is
committed to doing business ethically.
Leading by example, he expects all managers
What you DO is far more important than what you and employees to model ethical behavior
and integrates ethical principles into all
SAY in getting employees to act ethically! of L’Oreal’s business practices that build
relationships of trust with the company’s
customers.
Managers also set the tone through their reward
and punishment practices. The choices of when to
reward with pay increases and promotions send a
strong signal to employees. As we said earlier, when
an employee is rewarded for achieving impressive
results in an ethically questionable manner, it indi-
cates to others that those ways are acceptable. When
an employee does something unethical, managers
must punish the offender and publicize the fact by
making the outcome visible to everyone in the orga-
nization. This practice sends a message that doing
wrong has a price and it’s not in employees’ best
interests to act unethically! (See Exhibit 3–3 for
suggestions on being an ethical leader.)

etHICs trAINING. Yahoo! used an off-the-shelf
online ethics training package, but employees said
Charles Platiau/Reuters