The Ethical Manager Ideal – How Do You Measure Up?

If You See Yourself as an Ethical Person, Act Like It at Work

An ethical manager is a fair-minded person with principles they live by and share with their team and others, which they use to decide which actions are appropriate or otherwise.

In many industry sectors, increasing numbers of people are seeking to run their businesses ethically. Two major drivers are, having to manage diverse workforces, and navigating requirements for sustainability. However, there are still quite a few businesses out there which aren’t quite so ethical, where the ethics reflect the prevailing norms of the leadership and the workgroup, and its culture. But in those companies as much as anywhere else, someone who is determined to be an ethical manager still has the opportunity to set an example and be transformative. Thankfully, this article is dedicated to them.

What Are the Characteristics of an Ethical Manager?

It’s not rocket science. Being an ethical manager comes down to such fundamentals as showing respect for others and treating them with dignity and consideration. Furthermore, you should be approachable, good-natured, empathetic, understanding, and helpful in protecting and developing your team. Set an example by having a genuine concern for the people you come across.

Here’s another list of personal characteristics, that the experts say an ethical manager needs to have:

• Fair
• Honest
• Respectful
• Value-driven
• Encourage initiative
• Lead by example (this is essential)
• Focus on the team
• Show kindness

So we’ve established that an ethical manager needs to start their journey by being ethical. Now, let’s look at the challenges they’re likely to face in their working life.

What Are the 4 Functions of an Ethical Manager?

Southeastern Oklahoma State University (SOSU) identify four areas of ‘ethical reasoning’ and resulting activity, that ethical managers are likely to be involved with in their work:

1 – Rights and Duties:

Employees have certain rights under the law. These include the right to safe working conditions or a minimum wage, and in the UK, protection from discrimination under the Equality Act 2010. Moreover, employers have duties to ensure these conditions are met.

2 – Utilitarianism:

This means making decisions for the greatest good of the greatest number of people.

3 – Justice:

Making decisions with fairness, equity, and impartiality.

4 – the Ethics of Care:

Reaching decisions based on valuing people as human beings, and showing care and kindness.

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Ethical Managers’ Roles and Responsibilities

Managers who seek to be ethical must be committed to making decisions in accordance with core values such as honesty, integrity, respect for others, taking responsibility for their actions and being accountable for them.

Focusing on these areas helps leaders and managers lead businesses consistently and compassionately – and of course, ethically. Additionally, Southeastern Oklahoma State University (SOSU) spell all this out in a downloadable pdf. It’s written with US law in mind, primarily, and the PDF says as much. But SOSU’s words are worth reading wherever you are in the world.

Ethical leadership is a combination of being an ethical person and an ethical manager. Specifically, being an ethical person rests on a combination of key traits such as integrity and trustworthiness. The classic example is Equity, Diversity, and Inclusivity (EDI.) Saying your company operates an EDI policy is one thing. But it’s another thing altogether to make sure everybody feels safe and welcome working there, whoever they are. And that calls for ethical managers to take the lead.

Why Should Managers Be Ethical?

Here’s why. Quite often, especially in smaller companies, managers think of ethics as a question of personal scruples, a confidential matter between individuals and their consciences. This brings us back to such things as supporting EDI. By demonstrating ethically sound behaviour as a manager, and supporting it in others, you will strengthen the relationships and reputation your company depend on, and your business will grow.

So now let’s look at what people mean by ethically sound behaviour, as it applies to managerial roles.

What is an Ethical Manager?

Building on what we’ve said so far, an ethical manager is someone who demonstrates appropriate and thoughtful conduct inside and outside the business. They respect ethical beliefs and values and are motivated to safeguard the dignity and rights of others.

Here are some of the things ethical managers are recognised as doing:

• Ensure ethical values are consistent across the business.
• Promote open communication.
• Avoid bias.
• Lead by example.
• Accept responsibility, and admit mistakes.

Ethical Management Looks Like This

In progressive companies, ethical management is a management approach, in the broadest sense of the term, in which such ideals as morality, justice, virtue and respect are integrated into the way the company does business.

Why is Ethical Management Important to Business?

Whatever size your company is, ethical management will make it a better business to work for. IPA Business School identify these objectives of ethical management in the workplace:

• Build co-operation.
• Encourage team cohesion.
• Foster recognition between employees and their superiors.

Ethical leadership, based on these objectives, helps create a positive work culture. Furthermore, it fosters employees’ and customers’ loyalty and increases people’s productivity. IPA Business School say ethical leadership also improves brands’ image and reputation.

Increasing numbers of brands take ethical stances, particularly on social media, but a lapse into unethical behaviour can undo all the good work very quickly. For instance. if people read about a company’s leadership mistreating their employees, chances are they’ll stop supporting them as consumers. And after that, the company will have to win them back, by getting the message out there that things have changed for the better.

What is Unethical Management Behaviour?

A manager’s top priority is obviously to answer to their bosses, manage their team’s productivity, and play their part in increasing the company’s wealth. But they also need to act ethically. Here are some unethical behaviours to avoid:

• Misleading communications
• Fraudulent behaviour
• Anti-competitive activity
• Giving short measure: not supplying goods or services properly, honestly, and fairly.
• Not supporting team members with personal problems.
• Concealing knowledge: allowing unfairness: hiding information.
• Favouritism: gossip: badmouthing.
• Being unreasonable to your team: blaming others for your failings.
• Aggression
• Bullying
• Abusive leadership
• Unsafe behaviour: anything that puts people at risk.

It’s easy to be judgemental about companies or individual managers whose ethical standards we think fall short. We also need to remember these people’s ethics may reflect the industry they operate in, and the regulatory bodies and government.

20 More Unethical Management Behaviours

Leading on from the first list, here are some more examples of behaviour to avoid to become an ethical manager:

1. False claims in sales.
2. Wilful incomplete supply of agreed services
3. Financial irregularities.
4. Late payment of suppliers
5. Disregard of safety measures
6. Neglecting staff development and training
7. Lack of support for mental health and wellbeing
8. Micromanaging
9. Unfair employment terms
10. Unfair dismissal
11. Expecting people to regularly work long hours, or take work home
12. Poor communication
13. Bullying
14. Lack of proper performance reviews
15. ‘Blame culture’
16. Sexism and racism
17. Intolerance of marginalised groups
18. Unsafe premises
19. Substandard company vehicles
20. No commitment to sustainability

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Enough Doom and Gloom! Ethical Management Can Be Transformational

Let’s turn now to the more uplifting aspects of all this on ethical manager. The Seattle-based Center for Ethical Leadership says ethical leadership is knowing your core values, and having the courage to live them in all parts of your life in service of the common good. That sounds very virtuous, for sure! But the following behaviours can also be seen as simply good business sense:

12 Ways Ethical Management Can Make a Positive Impact on a Business

1. Evoke confidence in potential investors:

Set clear standards for ethical business practices, and you’re more likely to inspire people to put money into your company.

2. Build customer loyalty:

A company’s ethics can make or break its brand identity. We mentioned this before. Show ethical leadership in everything you do, and word will get around that you’re well-intentioned. But ensure you’re fully honest about your environmental, social and governance (ESG) performance. We’ll come back to this important point later.

3. More freedom, less micromanaging:

Set an example, and lay the foundation for a self-motivated team.

4. Good “press”:

Act ethically, and you stand less chance of negative and damaging coverage. That’s whether it’s in the national or local media, the trade press, or social media.

5. Establish trust in partners and vendors:

Build a network of trusted partners and reliable suppliers. Practise ethical leadership, and you’ll attract people you can rely on.

6. Keep morale high and boost individual performance:

Inspire and motivate people to a certain standard of integrity and accountability, and they’ll work better because their morale’s high.

7. Safe legal practices:

This doesn’t need much explaining. Set high standards for yourself and how you run your business, and you’ll avoid legal problems.

8. Self-satisfaction:

Everything we’ve talked about so far has involved putting others first, but this one brings YOU a benefit. Manage your team the right way, and you’ll feel good doing it.

9. A healthier work environment:

Use these tips about being an ethical manager to create a work environment where your team feel valued, comfortable, and inspired to be the best version of themselves. For more on this, you can read our article on work environment.

10. Attract better employees:

We’re not talking here about finding talented staff. Ethical managers are more likely to attract people who are trustworthy. But once they’re working for you, don’t let standards slip in things like expense claims, fraudulent sick days and timekeeping.

11. Improve other aspects of your life:

This is the realm of lifestyle coaches and therapists. But work on being an ethical manager, and it’ll rub off on your personal relationships and your life outside work too.

12. Build good habits that last:

Practice makes perfect, and the habits you develop will stay with you. But stay self-aware, and don’t let things slide…

Principles of Ethical Management

We’ve been talking in so many words about these throughout this article. Here’s a quick refresh. The 5 principles of ethical leaders and managers:

1. Respect:

Show empathy and tolerance of others’ opinions, and help them work out their individual purpose and values.

2. Service:

Prioritise the interests of others around you. In the case of your team, this means supporting them with mentorship, performance plans and team building.

3. Honesty:

Be open and honest, and don’t promise things you can’t deliver. Take accountability when things go pear-shaped.

4. Justice:

This is a slightly different take on ‘justice’ from the one we looked at earlier, but it’s the same principle. Apply the same rules to everyone, be fair, and act ethically.

5. Community:

All leaders and managers have goals, but as an ethical manager, you have SHARED goals which consider both your and your team members’ needs. Be open with the team about the goals, engage with them and try to understand their attitudes. And remember, you’re only human. So, if you get frustrated with particular people, be careful not to flip into Unethical Management Behaviour #13 on the earlier list, and start bullying them.

And Finally: Where Does Gender Come Into Being an Ethical Manager?

As we said at the start, being an ethical manager starts with being an ethical person. Gender shouldn’t come into it. However, a recent international study, published in March 2023 by a team from three English universities, indicates that male corporate leaders are more likely to go in for greenwashing than female leaders. So, we have a gender gap in business ethics. This revelation got relatively little media coverage when it came out, so let’s look at it again.

Greenwashing Involves Being Unethical on an Industrial Scale

In the story on the University of Portsmouth’s website, a team from the University of Portsmouth, Brunel University and Loughborough University observed 3,902 firms from 29 countries over 14 years. They looked at their ESG ‘decoupling data,’ the term used to describe the gap between what firms disclose about their environmental, social and governance practices, and their actual performance.

As we mentioned, the study found that companies with more female corporate leaders were less likely to exaggerate how positive their environmental impact is, hence the term greenwashing. Dr Ahmed Aboud is from the University of Portsmouth’s School of Accounting, Economics and Finance. He says in the article on the University of Portsmouth website, “Our study supports existing theories that women directors are crucial players in preventing this, as they are more likely to speak out against unethical behaviour, and support environmentally conscious decisions.”

Dr Aboud also says in the piece that this relationship is also more noticeable in firms operating in “controversial industry sectors.” He holds the report up as a clear justification that women should play a more significant role in business management, as they are “crucial players” in improving environmental practices. Dr Aboud concludes that these findings have important implications for policymakers, investors, and other stakeholders interested in promoting responsible and sustainable corporate behaviour.

Want to Know More About All This? Your Starter for 10, Download the PDF

Finally, whether you’re an ethical manager, or looking to become one, there are plenty of books to read and courses to help. We’ve mentioned Southeastern Oklahoma State University’s excellent free PDF, designed to help managers lead businesses consistently and compassionately – and ethically. Start by downloading it and getting to grips with the ideas. At just 6 pages, it’s worth spending time reading it. In our uncertain times, the message is clear – not just ethical managers, but ALL managers, must be committed to making decisions in accordance with core values such as honesty, integrity, respect for others, taking responsibility for their actions and being accountable for them. The future starts now.