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4. Leading with Integrity
INTEGRITY QUOTE #1
“The strength of a nation
derives from the integrity
of the home.” – Confucius
INTEGRITY QUOTE #2
“To be persuasive we must
be believable; to be
believable we must be
credible; credible we must
be truthful.”— Edward R.
Murrow
INTEGRITY QUOTE #3
“Though negotiations are a rough game, you
should never allow them to become a dirty
game. Once you've agreed to a deal, don't
back out of it unless the other party fails to
deliver as promised. Your handshake is your
bond. As far as I'm concerned, a handshake
is worth more than a signed contract. As an
entrepreneur, a reputation for integrity is
your most valuable commodity. If you try to
put something over on someone, it will
come back to haunt you.”
– Victor Kiam
INTEGRITY QUOTE #4
“In looking for people to
hire, you look for three
qualities: integrity,
intelligence, and energy. And
if they don’t have the first, the
other two will kill you.” –
Warren Buffet
INTEGRITY QUOTE #5
“What is left when honour
is lost?” – Publilius Syrus
INTEGRITY QUOTE #6
“Trust starts with
trustworthy leadership. It
must be built into the
corporate culture.” –
Barbara Brooks Kimmel
INTEGRITY QUOTE #7
“I wouldn’t ask anyone to
do anything I wouldn’t do
myself.” – Indra Nooyi
INTEGRITY QUOTE #8
“To be trusted is a greater
compliment than being
loved.” – George
MacDonald
INTEGRITY
▪ “… the state of being complete, unified.”
▪ “When I have integrity, my words and my deeds match up. I am
who I am, no matter where I am or who I am with” – John C.
Maxwell, Developing the Leader Within You
▪ Is integrity merely about “not being caught” doing wrong? Does
“not being caught” qualify as being a person of integrity?
SAMPLE CASES: WHEN INTEGRITY IS MISSING IN LEADERSHIP
SENATOR ELIZABETH WARREN GRILLS CEO OF
WELLS FARGO OVER SCANDAL
(PLEASE CLICK ON THE TITLE OR THE IMAGE)
WHY INTEGRITY MATTERS
1) INTEGRITY BUILDS TRUST
2) INTEGRITY HAS HIGH INFLUENCE VALUE
3) INTEGRITY FACILITATES HIGH STANDARDS
4) INTEGRITY RESULTS IN A SOLID REPUTATION, NOT
JUST AN IMAGE
5) INTEGRITY MEANS LIVING IT MYSELF BEFORE
LEADING OTHERS
6) INTEGRITY HELPS A LEADER BE CREDIBLE, NOT JUST
CLEVER
7) INTEGRITY IS A HARD-WON ACHIEVEMENT
Source:
Developing the Leader Within You by John C. Maxwell (1993)
ETHICAL DILEMMAS
▪ Natural tendency to react quickly to resolve
dilemma or pretend we did not notice.
▪ Key is to slow down the process and reflect
on the ethical and moral aspects of actions
and decisions.
▪ Allow yourself and others time to work
through complex problems and engage in a
process that includes reflection before
action.
▪ Including others in the resolution leads to
feelings of empowerment.
CREATING AND SUSTAINING AN ETHICAL
ORGANIZATIONAL ENVIRONMENT
Nash proposes four qualities that are necessary
for participants to advance ethical standards in an
organizational
▪ Critical thinking skills to analyze and convey the
ethical components of a problem or dilemma
▪ Possession of a high degree of integrity to stand
up for your personal and professional ethics
▪ The ability to see situations from others’
perspectives
▪ Personal motivation to do the right thing
ETHICAL DECISION MAKING
▪ Important that a leader is prepared to receive
criticism, see members revolt, and perhaps
experience a decline in membership.
▪ Not everyone in an organization is prepared
or willing to do the right thing or has a moral
orientation.
▪ Part of the leadership process is to fully
explain to others the problem at hand and
the basis for the action or decision.
CORE VALUES
▪ All participants―positional leadership and
members alike―should be empowered to
set the tone.
▪ The organization’s mission or the group’s
common purpose should be the driving force
for identifying its values.
▪ Appointing one person to be the group’s
ethicist or when a leader acts in isolation to
handle ethical dilemmas can be
counterproductive.
LEARNING FROM GOOD AND BAD
LEADERSHIP
▪ Two categories of bad leadership
(Kellerman)
▪ Bad as in ineffective
▪ Ineffective leadership includes the failure
of achieving a desired change.
▪ Bad as in unethical
▪ Fails to distinguish between right and
wrong.
TOXIC LEADERS
Toxic leaders are those
▪ “who engage in numerous destructive
behaviors and who exhibit certain
dysfunctional personal characteristics. To
count as toxic, these behaviors and qualities
of character must inflict some reasonably
serious and enduring harm on their followers
and their organizations.”
EXAMPLES OF BEHAVIORS AND TRAITS ASSOCIATED
WITH TOXIC LEADERS
▪ Leaving followers worse off than when they found them.
▪ Violating basic standards of human rights of their own
supporters.
▪ Consciously feeding their followers illusions that enhance the
leader’s power and impair the followers’ capacity to act
independently.
▪ Misleading through deliberate untruths and misdiagnoses of
issues and problems.
▪ Insatiable ambition putting leader’s above followers’ well-
being.
▪ Enormous egos that blind leaders to the shortcomings of their
own character.
▪ Reckless disregard for the costs of their actions to others.
▪ Cowardice that leads them to shrink from difficult choices.
ETHICAL LAPSES
Individuals committed to leading with
integrity are faced with their own dilemma of
what to do when values clash with the
organization’s standards. This offers three
choices:
▪ Ignore or put up with the situation.
▪ Address the situation and work to change the
organizational climate into one that is ethical
in nature.
▪ Leave the organization.
MORAL PURPOSE AS AN ACT OF COURAGE
▪ Moral courage: the quality of mind and spirit
that enables one to face up to ethical
challenges firmly and confidently, without
flinching or retreating.
▪ Courage is not the absence of fear but the
ability to step through it.
▪ Moral courage can be viewed as the
intersection of three conceptual fields:
principles, danger, and endurance.
▪ Example: It took moral courage for Nelson
Mandela to be imprisoned for eighteen
years in his opposition to apartheid in
South Africa.
Developing Moral Courage
• Mental and moral strength to engage in,
persevere through, and withstand danger,
difficulty, or fear
• Courage means accepting and learning from
failure
• Courage means being prepared
• Accepting responsibility
• Nonconformity
• Pushing beyond the comfort zone
• Courage means speaking up: asking for what you
want and saying what you think
• Courage means fighting for a higher purpose
27
Courage
• Asking for what you want and saying what
you think is not always taught so well to
us since childhood. We have been trained
very well (perhaps too well) to comply and
obey. But to stand up and voice out
requires different kinds of skills.
– Abilene paradox: Tendency to resist voicing
their true thoughts or feelings in order to
please others and avoid conflict
• Fighting for what you believe
28
How Does Courage Apply to
Moral Leadership
• Applying courage to:
– Be unconventional and do what is right
– Step up and take responsibility
– Balance:
• Profit with people and self-interest with service
• Control with stewardship
– Act like a moral leader
– Whistleblowing: Employee disclosure of
illegal, immoral, or unethical practices in
the organization
29
Finding Personal Courage
Believe in a higher purpose
Draw strength from others
Harness frustration and anger
Take small steps
30
Creating an Ethical Climate
in Business
• Leaders face pressures that challenge their
ability to do the right thing
• Obstacles for leaders
– Personal weakness and self-interest
– Pressures to:
• Cut costs and increase profits
• Meet the demands of vendors or business
partners and look successful
• Please shareholders
Leaders Set the Ethical Tone
• Credibility is the foundation of leadership –
leading by example, pays huge dividends and
establishes deep trust and respect. Do the work
right, be hands-on, and be visible about it before
you become vocal
• Act as positive role models
• Signal what matters by their behavior
• Focus on employees, customers, and the greater
good
• Not paying attention to gaining benefits
themselves
• Honest with employees, partners, customers,
vendors, and shareholders
Leaders Set the Ethical Tone
• Strive for fairness and honour agreements
• Share the credit for successes and accept
the blame when things go wrong
• Speak up against acts they believe are
wrong
Comparing Ethical versus Unethical
Leadership
The Ethical Leader The Unethical Leader
• Possesses humility • Is arrogant and self-serving
• Maintains concern for the greater good • Excessively promotes self-interest
• Is honest and straightforward • Practices deception
• Fulfills commitments • Breaches agreements
• Strives for fairness • Deals unfairly
• Takes responsibility • Shifts blame to others
• Shows respect for each individual • Diminishes others’ dignity
• Encourages and develops others • Neglects follower development
• Serves others • Withholds help and support
• Shows courage to stand up for what is • Lacks courage to confront unjust
right acts
Source: Based on Donald G. Zauderer, “Integrity: An Essential Executive Quality,” Business Forum (Fall 1992), pp. 12–
16.
Richard L. Daft, The Leadership Experience, 8th Edition. © 2023 Cengage. All Rights Reserved. May not be scanned,
copied or duplicated, or posted to a publicly accessible website, in whole or in part.
34
Acting Like a Moral Leader
• Recognize and adhere to ethical values.
Business is about values and not merely
economic performance.
• Acknowledge the importance of human
meaning, quality, and higher purpose
• Encourage others to develop and use moral
values and adhere to ethical standards of
conduct
• Leaders need to demonstrate a commitment
to ethics in their words and especially their
behavior.
How to Act Like a Moral Leader
Sources: Based on Linda Klebe Treviño, Laura Pincus Hartman, and Michael Brown, “Moral Person and Moral Manager: How Executives Develop a
Reputation for Ethical Leadership,” California Management Review 42, no. 4 (Summer 2000), pp. 128–142; Christopher Hoenig, “Brave Hearts,” CIO
(November 1, 2000), pp. 72–74; and Patricia Wallington, “Honestly?!” CIO (March 15, 2003), pp. 41–42
Becoming a Moral Leader
• Moral leadership: Distinguishing right
from wrong and doing right
– Seeking the just, honest, and good in the
practice of leadership
• Internal characteristic that influences a
leader’s capacity to make moral choices is
the individual’s level of moral development
Three Levels of Personal Moral
Development
Sources: Based on Lawrence Kohlberg, “Moral Stages and Moralization: The Cognitive-Developmental Approach,” in Moral Development and Behavior Theory,
Research, and Social Issues, ed. Thomas Likona (Austin, TX: Holt, Rinehart and Winston, 1976), 31–53; and Jill W. Graham, “Leadership, Moral Development, and
Citizenship Behavior,” Business Ethics Quarterly 5, no. 1 (January 1995), 43–54
Servant Leadership: A Model for
Leadership Integrity & Moral Courage
• Leader transcends self-interest to:
– Serve the needs of others
– Help others grow
– Provide opportunities for others to gain
materially and emotionally
• Comparing servant leadership with other
types of leadership practices:
– Authoritarian management
– Participative management
– Stewardship
Changing Leader Focus from
Self to Others
40
Authoritarian Management: Do “top-down”,
“command and control” structures create
conditions that lead to moral compromise?
• Leaders set the strategy and goals, as well
as the methods and rewards for attaining
them; traditional leadership.
• Organizational stability and efficiency are
paramount; leaders direct and control
their people/subordinates.
• Subordinates are given:
– No/little voice in creating meaning and
purpose for their work
– No/little discretion as to how they perform
their jobs
41
Authoritarian Management
• Emphasis on:
– Tight top-down control
– Employee standardization and
specialization
– Management by impersonal measurement
and analysis
42
Participative Management
• Paternalistic mindset
• Actively involves employees
– Employee suggestion programs
– Participation groups
– Quality circles
• Leaders determine purpose and goals,
make final decisions, and decide rewards
– Employees are not allowed to be true
partners in the enterprise
43
Participative Management
• Employees are expected to:
– Make suggestions for quality improvements
– Act as team players
– Take greater responsibility for their own
jobs
44
Stewardship
• Belief that leaders are deeply accountable
to others as well as to the organization
– Without trying to control others, define
meaning and purpose for others, or take
care of others
45
Principles for Stewardship
Adopt a partnership mindset
Give decision-making power and the authority to act to
those closest to the work and the customer
Tie rewards to contributions rather than formal
positions
Expect core work teams to build the organization
46
Revisiting:
Servant Leadership
• Leadership in which the leader transcends
self-interest to serve the needs of others,
help others grow, and provide
opportunities for others to gain materially
and emotionally:
- Puts service before self-interest
- Listens first to affirm others
- Inspires trust by being trustworthy
- Nourishes others and helps them become
whole
47
ASSUMPTIONS ABOUT ETHICAL LEADERSHIP
1. Ethics is the heart of leadership.
2. All leadership is values-driven.
3. Personal values intersect with organizational
values.
4. Ethical leadership can be learned.
5. Ethical leadership involves a connection
between ethical thought and action.
6. Character development is an essential
ingredient of ethical leadership.
7. Ethical leadership is a shared process.
8. Everything we do teaches.
CULTURAL ASSUMPTIONS
▪ Ethics exist in a cultural context; they are culturally
bound or culture-specific.
▪ There is no universal agreement on what
behaviors or practices are considered
appropriate, legal, ethical, or moral across
cultures.
▪ Example: The treatment of women in Saudi
Arabia compared to the United States. What is
unethical or ethical in one is seen differently in
the other.
▪ To what extent is ethics temporal in nature,
especially in light of changing laws and legal
norms?
▪ To what extent is corruption a culturally
constructed behavior?
CULTURAL ASSUMPTIONS
Personal competencies for establishing cross-
cultural relationships.
1. Be nonjudgmental.
2. Be flexible.
3. Listen attentively/observe carefully.
4. Assume complexity.
5. Manage personal biases.
6. Show respect.
7. Show empathy.
TRANSFORMING LEADERSHIP THEORY
▪ Transforming leadership is a process in
which “leaders and followers raise one
another to higher levels of morality and
motivation” - James McGregor Burns
▪ Transforming leadership involves
persuasion, a desire to change something
and multidirectional influence relationships
between leaders and participants.
▪ Values or ideal such as peace, justice,
fairness, liberty, equal opportunity, and
people’s general welfare are expressed by
transformational leaders.
TRANSFORMATIONAL LEADERSHIP THEORY
▪ About the relationship and influence
between leaders and followers.
▪ This symbiotic relationship is an interaction
or power and shared values.
▪ Transforming leaders have the courage to
confront reality even if it is painful and have
healthy egos to withstand peer pressure.
▪ Possessing positive self-esteem (not needing
to please others to win their favor) is a
necessary element of leading with moral
purpose.
ETHICAL DECISION-MAKING MODELS
Several approaches to resolve ethical dilemmas
▪ Utilizing professional codes of conduct, rituals,
standards, constitutions, and bylaws
▪ Like leadership, ethics is not a neat and tidy
concept. It requires human judgment and
analysis to determine whether a situation
represents an ethical dilemma or something else,
such as a personality conflict.
PRACTICAL APPLICATIONS
▪ Rush Kidder’s Four Dilemma Paradigm Model
1. Justice vs. mercy: fairness and equity conflict
with compassion, empathy and love
2. Short term vs. long term: immediate needs
run counter to future goals
3. Individual vs. community: self vs. others or
small group vs. larger group
4. Truth vs. loyalty: honesty competes with
commitment, responsibility, or promise-
keeping
▪ These dilemma paradigms represent values that
collide with each other. Right vs. wrong is
usually clear. Right vs. right is far more difficult
to resolve.
KIDDER’S ETHICAL DECISION MAKING
MODEL
▪ Ends-based thinking: “Do whatever
produces the greatest good for the greatest
number.”
▪ Rule-based thinking: Follow only the
principle that you want everyone else to
follow.
▪ Care-based thinking: “Do to others what
you would like them to do to you.” (The
Golden Rule)
FIVE ETHICAL PRINCIPLES IN DECISION
MAKING
▪ Respecting autonomy
▪ Doing no harm of no maleficence
▪ Benefiting others or beneficence
▪ Being just or justice
▪ Being faithful or fidelity
