Why Companies Must Declare Their Ethical Beliefs Today
By: Rob Peters
Tags: Trust, Ethics, Performance, Workplace Culture, Leadership

Why Companies Must Declare Their Ethical Beliefs Today

In a recent article on Linkedin by Accenture’s Amy Fuller, she shared a 2018 trend that confirms our work at the Standard of Trust. Olof Schybergson, Fjord’s co-founder, CEO, and prominent thought leader revealed that trend to be “The Ethics Economy”. Rob Peters Feb 6, 2019·7 min read

In The Ethics Economy, organizations and companies will essentially be compelled to actively define their ideologies and publicly state their ethical beliefs — whether they want to or not. — Amy Fuller, Accenture

Ethical Leadership Lessons

It’s common knowledge that Benjamin Franklin provided great support and counsel in the drafting of the Declaration of Independence and was sent as a diplomat to France to ask for assistance during the Revolutionary War. He was a skilled man across a wide variety of disciplines such as scientist, inventor, printer, newspaper writer, as well as politician. He is credited with starting America’s first fire department and public library. Ben Franklin’s face is still on the $100 bill. Less commonly known, perhaps, is that Franklin tried to live by the maxims that seem so simplistic in today’s complex digital and social world.

In “The True Story of Benjamin Franklin,” author Lee Lothrop shares a story from Franklin’s childhood. When Franklin was a boy, he and his friends decided one day that in order to catch minnows they needed to build a wharf. They found a convenient pile of stones and lugged them to the marsh where the boys usually fished, and soon, with a good deal of effort, they put together a fishing wharf.

Unfortunately, the stones had been intended for the cellar of a new house, and since building the wharf was Ben’s idea, he was punished. Ben argued with his father that since the stones were there and a wharf was needed, he had done no wrong. He did not persuade his father: “The stones were not yours to take, Ben,” said his father. “What is not honest cannot be truly useful.” This incident helped frame his famous saying, “Honest is the best policy” as one of Franklin’s guiding principles for his life.

At the age of 20, Ben Franklin committed to 13 virtues, which he followed devotedly:

“Temperance. Eat not to dullness. Drink not to elevation.”

“Silence. Speak not but what may benefit others or yourself. Avoid trifling conversation.”

“Order. Let all your Things have their Places. Let each part of your Business have its Time.”

“Resolution. Resolve to perform what you ought. Perform without fail what you resolve.”

“Frugality. Make no Expense but to do good to others or yourself: i.e., Waste nothing.”

“Industry. Lose no time. Be always employed in something useful. Cut off all unnecessary Actions.”

“Sincerity. Use no hurtful deceit. Think innocently and justly, and, if you speak; speak accordingly.”

“Justice. Wrong none, by doing injuries or omitting the Benefits that are your Duty.”

“Moderation. Avoid Extremes. Forbear resenting Injuries so much as you think they deserve.”

“Cleanliness. Tolerate no Uncleanness in Body, Clothes, or Habitation.”

“Tranquility. Be not disturbed at Trifles, or at Accidents common or unavoidable.”

“Chastity. Rarely use Venery but for Health or Offspring, never to Dullness, Weakness, or the Injury of your own or another’s Peace or Reputation.”

“Humility. Imitate Jesus and Socrates.”

Ben Franklin conveyed his practical philosophy into all his ventures, including politics, where he was deeply concerned about fraud and integrity. He understood that our republic could only continue if people did away with dishonesty and held on to good principled ethics and participated in community duty. Nonetheless, he understood that few were able to meet this high standard, as he witnessed: “Men largely considered that their own and their Country’s Interests were united and did not act from a Principle of Benevolence.”

How would Ben Franklin lead in today’s hyperconnected and transparent digital world? I believe Mr. Franklin would have embraced this communication media to influence his customers (he would have put the Farmer’s Almanac on the internet). He would have also have communicated with his fellow Americans on the injustices of the day from the British Commonwealth.

Ethical Leadership is the foundation for Earning Relationship Capital Today

Ethical Leadership on digital and off is leading by intentionally doing what is right. The challenge with practicing ethical leadership is that it is difficult to define “right”. Ethical leadership is composed of two sections:

The leader must act and make judgments ethically,

Second, the leader must also lead ethically in their actions, perceptions, and interactions.

Traditionally, the view of leadership has been that the main goal is to increase production and profits. This traditional view of leadership is fading, as more thought leaders in the 21st century are asserting that leaders also have the responsibility for adhering to open standards of moral and ethical behavior. Good leadership refers not only to competence but also to ethics and changing people. [i]

“Ethics is knowing the difference between what you have a right to do and what is right to do.” –Potter Stewart

All leadership is responsible for influencing supporters to achieve an action, complete a task, or fulfill a commitment in a specific way. Effective leaders influence method, encourage change in employee’s attitudes and values, bolster followers’ principles, and nurture the adoption of the leaders’ vision by leveraging strategies of empowerment.

It is understood that the encouraging aspect of leaders can elevate organizational cultures and employee values to high levels of ethical consideration. Ethical leadership requires ethical leaders. If leaders are principled, they can ensure that principled practices are carried out throughout the organization.

Leaders who are ethical demonstrate a level of integrity that is important for stimulating a sense of leader trustworthiness or relationship capital, which is important for followers to accept the vision of the leader. These are critical and direct components to leading ethically. The character and integrity of the leader provide the basis for personal characteristics that direct a leader’s ethical beliefs, values, and decisions. Individual values and beliefs impact the ethical decisions of leaders.

Leaders who are ethical are people-oriented, aware of how their decisions impact others and use their social power to serve the greater good instead of self-serving interests. In ethical leadership, it is important for the leader to consider how his or her decisions impact others.

Motivating followers to put the needs or interests of the group ahead of their own is another quality of ethical leaders. Motivating involves engaging others in an intellectual and emotional level. A Relationship Capital (RC) commitment between leaders and followers makes both parties equally responsible in the pursuit of a common goal.

The Ethical Economy and Relationship Capital

The following on open ethics or sustainable relationship principles that the social and digitally-connected people agree are required in order to consistently earn relationship capital or “RC” for a declared and kept-commitment on the Peer SaaS platform:

Honesty

Accountability

Responsibility

Support

Respect

Proactive Trustworthiness

The RC game of relationship capital rewards fulfilled commitments by crediting your RC account. If you do not fulfill an RC Promise then your account is debited. There can be no “Heaven without Hell.” We have always made promises to others especially in business interactions, but now we get them out of our heads and into the “cloud” whereby we can capture, measure, and utilize relationship capital for authentic credibility and reputation.

Introducing Peer SaaS “Performing Excellence-Engaging Recognition

Conclusion

These characteristics of ethical leaders are similar to inspirational motivation, which is a style component of transformational leadership. Inspirational motivation “involves inspiring others to work towards the leader’s vision for the group and to be committed to the group”. Likewise, ethical leadership “falls within the relationship of inspiring, stimulating, and visionary leader behaviors that make up transformational and charismatic leadership”. Sustaining business today requires ethical leaders who can act and nurture an organizational culture that will publicly declare its purpose, ethics, and commitments.

Ethical leaders and their organizations embrace the digital and social platforms for greater risk-taking, transparency, and results. The best examples are the relationship capital leaders I have met over the past 10 years. They already are high integrity individuals who understand their true north values. These relationship capital leaders are the first in line to sign up for a Peer SaaS account to have their commitments declared to their stakeholders. Practicing ethics brings many benefits to the organizational leader and the business. It is now an imperative.

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