Ethics and professionalism

MGT 5023
Developing the ethical mind
Syed abd Hamid Aljunid
Nov 2020
The need for ethical leadership and the
ethical mind
• Leaders envision the future, set direction and determine standards of
behaviour in order to attain the future goals and objectives.
• In the process, leaders must be responsible for strategy, risk management
system and internal control system to provide value to society and generate
returns to investors and owners.
• Most importantly, the board must determine the ethical values that define
how things ought to be done in the company. In other words the core values
define what the company and its people (within or outside)
uncompromisingly stands for.
• To achieve the above leaders must earn and gain the trust of those who
follow and those who deal with the company.
Core purpose and the issue of profit and non-
profit goals
• The core purpose of the company given licence to exist and operate must be for the
direct or indirect benefit of society.
• It is believed by the founders and other leaders of the company.
• So profit cannot be the core purpose of the company. Profit maximization in this case
is selfishness in action and it has no regards for the interest of others. In the case of
scams, the intention is to cheat others
• Profit is the reward to the company for having done the right thing from the
perspective of customers ( like providing use value and satisfaction) and other
stakeholders ( creating skills, compliance with the laws and regulations, and
developing sustainable activities).
• Not for profit or non profit corporations also have socially beneficial goals but the
ethical issues center on governance and professionalism.
Core values and the role of culture in promoting ethics

• Values are what we are comfortable identifying with, what we want to

have, what we are willing to sacrifice for and what gives us a sense of self
worth. Social values are essential when we live in groups or communities.
• Disvalues are those we frown upon and we ought to avoid as they tend
to undermine social cohesion or survival of the group.
• Values include ethical and other social values. Honesty is an ethical value
while uniformity such as dress code is a social value.
• All values have their significance but ethical values are required in the
competitive environment in order to prevent self interest turning into
selfish interest when leveraging on opportunities.
Values, norms and virtues- How are they
related?
• Values are understanding of what are important and what gives meaning to
ourselves as we live in the context of roles and relationships in a community
• Social or organizational values may not be consciously known but its effect on
behavior and actions are guided by norms that are observable by others
• Norms are customary and expected of members in terms of how one ought to
behave in a particular situation eg social norms in moderating competing goals
• Values and norms may or may be different in different societies or in different
time periods.
• However there values which are similar and these known as natural human
values though they may be differently expressed or articulated. Eg core values
of responsibility, transparency, honesty and keeping promise etc
 Values and virtues at individual and
corporate levels
• Virtues are character traits that have been developed in man and is a
reflection of the values that are important to his role as a human
being as well as his role as a citizen.
• Virtues are qualities between two extremes (disvalues) and are
qualities that disposes human being into action without having to
think and reflect. For example generous person is a person who is
disposed to act generously.
• Virtues are therefore values in action and it can be at the level of the
human person or the corporate person. Core values shared and lived
by in a company become corporate virtues.
Virtue ethics – how it is related to ethics and
professionalism
• Virtues are cultivated disposition that require no deliberation or thinking especially
when a situation warrants an immediate response. There is also no ulterior motive in
that action. A person of integrity will act courageously notwithstanding the potential
consequences of his action.
• Professionalism is the embodiment of character traits and mindset of a professional
where the expertise are translated into services critical to society whether for a fee
( contract for service) or as part of employment( contract of service)
• There are moral as well as non moral virtues
• Examples of virtues include integrity, honesty, loyalty, accountability, responsibility,
fairness, justice, temperance, etc
• Examples of non moral virtues include discipline, efficiency, competitive, ambitious,
charisma, creativity, cooperativeness, honour etc
Ethics and leadership
• Leaders must have both the competency in ethical thinking as well as
character traits or virtues to help them manages followers and others
• The virtue of integrity is critical for leadership as it is manifested in
behavior that promotes honesty, trustworthy and reliability regardless
of the consequences. Righteous people are known for their integrity.
• Courage enables one to follow through a decision even though it may
not be popular because it does not satisfy short term thinking, it does
not promote narrow view of business and because it allocates
resources to do what is not required by law.
• Leaders consciously develop ethical conscience and ethical culture.
Ethical leadership in managing or governing
an organization
• Ethical leaders are conscious of their roles as examples for others.
• Being a role model, leaders not only does the right thing, but he also
encourage others to do the right thing. In other words leadership
involves creating and developing the right framework or environment
for behaving in the right way.
• How is ethical leadership manifested in the governance of an
organization when there are many dimensions of leadership?
• Boards, individual directors, executives, investors, shareholders,
shareholders and stakeholders exercise leadership when they play
their roles well.
 Leadership within and among persons
• Process of influencing and transforming –Ikhtiar
• Engaging and collaborating dimensions
• Awareness of role modelling and impact on others
• Therefore the following are necessary:
1) Respect for people as human beings
2) value differences in worth and viewpoints
• The intellect (Aqal) when activated, leads the irascible souls ( nafs
amarah) to prevent greed for power and wealth, promote balanced
pursuit of goals
Ethical Leadership in action
• Awareness of how ethics define one’s leadership
• Being in touch with one’s values, especially ethical values
• Using ethical principles as benchmark for hisab
• Sensitivity to leader follower synergy or dissynergy
• How are followers positioned in one’s leadership plans
• Significance of team dynamics to the relationship strategy
• Mentoring and empowerment
Familiarizing with ethics in personal
leadership map
• Confronting dilemmas and conflicts
• Dilemmas and the role of ethical competency and reasoning
• How ethics get to be part of leadership and culture
• What are conflicts and how are they recognised
• Conflict of interests vs conflict of duties
• Challenges of leadership
Challenges of ethical leadership
• Challenge of power and duties to exercise power
• Challenge of roles and responsibility
• Challenge of managing and distributing information and data
• Challenge of loyalty –perceptions and expectations
• Challenge of remaining consistent-istiqamah
• What happens when above challenges are not properly met?
Factors leading to unethical leadership
• Incompetence in managing and problem solving
• Character flaws and lack of control
• Impervious to new and different ideas
• Unbalanced pursuit of goals – insensitive to the needs of followers
• Corrupt and overly self interested-Amarah
• Corporate nationalism or insularism
Ethical leadership require the following
• Don’t stay in one position too long
• Share power- power is intoxicating
• Humility and refuse to believe hype about oneself
• Do not block out negative feedback or ignore small misdeeds
• Recognise weaknesses and limitations and be in the company of those
who can compensate those weaknesses.
• Maintain positive support system with families and friends
• Reflect for enhanced self awareness
• Limit path dependency to world view but not to solutions
Leadership and followership are part of a
continuum
• We are leaders of some and followers of others in any organizational
system
• We were followers in the organization but now we lead the
organization or its department
• So we have a followership role as part of the integrity system
• We have to be aware of ethical followership and the challenges faced
by ethical followers
Ethical challenges of followership
• Challenges of loyalty and obligation
• Challenges of obedience and integrity
• Challenge of gaining trust and respect
• Challenge of disagreement and dissent
• Challenge of advising
• Challenge of being cynical
• Challenging of being the bearer of bad news
Ethical danger signs when accepting
responsibility
• Group think
• Overconfidence
• Close-mindedness
• Peer or group pressure
• Polythink
• Hypocracy- between private and public space
• Moral exclusion- Insiders vs outsiders-double standards
How to avoid toxic leaders
• Avoiding motivational traps when seeking leaders:
• Need for authority
• Need to be part of group or team
• Fear of powerlessness
• Feeling of uncertainty and helplessness
• Excessive admiration of the gifted
• Need for self esteem

Avoid being conformers and/or colluders- remember group think?

Purpose and values as source of strength to avoid motivational traps
Attributes of responsible team member
• Adopt an attitude of cooperative orientation
• Perform fair share of work- look out for free riders
• Match members to respective tasks and recognize their unique
importance to group achievements
• Create positive group norms
• Supportive communication for building ethical climate- Johari window
Developing an ethical climate
• Making ethics matter- The formal dimensions-
• The seven S
• Core purpose and core values
• Codes of ethics
• Structures and processes
• Reward and performance systems
• Reporting and communicating effectiveness
The informal dimensions
• Informal norms
• Language
• Rituals
• Stories and story telling – leading minds
• Heroes
Drivers of ethical cultures
• Ethical climate survey
• Integrity system
• Climates and ethical behaviour
• Role of leadership in developing and maintaining ethical climate
• Recruitment and socialization
• Ethics training and development
Moving forward
• No short cuts
• Growth takes time and nutrients
• Support system critical
• Self reflection and audit
• Commit to direction but patient with magnitude
• Commitment with sincerity
Ethics for boards and their roles
• Board set ethical tone at the top through vision, mission, core purpose
and core values
• Boards are responsible for codes of ethics, codes of conduct ,whistle
blowing and developing corporate ethical culture.
• These are reinforced with appropriate structures and systems.
• Boards set example or become role models in conducting business by
being accountable to share holders and being responsible to
stakeholders.
• Board controls managerial opportunism or agency problem by being
responsible for internal controls and risk management.
Ethics for directors as part of leadership team
• Duties of directors as prescribed by laws and regulations to be
understood and applied.
• Fiduciary duties and duties of care skills and diligence
• Duty to exercise powers for a proper purpose
• Details are found in company laws and governance codes
• Directors are able to think independently and have good track records
• Directors interact with each other based on respect, fairness,
transparency and trusting relationship among others.
Ethics for managers as leaders
• Character strength to resist managerial opportunism vis agency theory eg
integrity
• Culture of openness, transparency, engagement, delegation and
empowerment
• God fearing and ethically aware
• Good working relationship with the board and comfortable with the
practice of being challenged through informed knowledge
• Develop subordinates ethical competencies
• Alignment of systems, skills, structure, staffing, strategies and leadership
styles with core values.
Q& A