Leadership, effective communication foster ethical outcomes

Some lessons are gained over the long haul – others are hard and fast.  This one is in the latter category.  What seems like a lifetime ago, when my professional time was expended as co-owner of a marketing research company, we were targeted by scammers.  Our company name and logo was used without our knowledge or consent to dupe unsuspecting consumers in North America.  The phone calls started pouring in.  Most heeded our pleas to contact their local police department and avoid these criminals altogether.  Others were frantic.  I learned a lesson in human nature as I was trying to convince a woman from Chicago not to deposit a forged cheque and wire money to a third party.  The woman, like many, was clinging to some hope that the deception could be true.  Although we didn't talk in great length, it was apparent she desperately needed the cash.  Unfortunately, these scams continue and often target the most vulnerable in society – elderly, young, ill, financially strapped people who are searching for a life line.  The story captures the reason behind my commitment to business ethics.

How does one pursue a right or ethical course of action?  I believe it is not enough to know what’s right – most folks know what they should do but often take the opposite road.  Just talk to the average smoker: they understand that cigarettes cause negative medical issues but continue regardless.  Doing the right thing is often hard, especially when it is unpopular.  For this reason, ethical outcomes require ethical leadership.  This type of leadership isn’t just concerned about profit or personal gain but carefully considers stakeholders such as employees, suppliers, shareholders, government, competition and the community.  Massive flooding forced Idomo owner Gerrit De Boer to close his Toronto store for months in 2002.  He continued paying employees during this challenging stretch even though the furniture retailer wasn't open to the buying public.  Without the ethical leadership exercised, more than just wages would have been lost by workers. 

The second part of the equation for the pursuit of ethical action is effective communication.  Doing the right thing is seldom an affair conducted in a sterile laboratory-type environment.  It involves jobs, people, emotions, red tape, money and competing interests.  Open and honest communication is imperative for realizing successful ethical results.  The goal is not to convince everyone – disagreement and divergent opinions are facts of business (and life) – but to create an environment of transparency and respect.  Before De Beers began mining on new land in northern Ontario, they communicated with local communities through dozens of town hall meetings.  The effective communication was credited with moving the process forward and creating a foundation for success benefiting multiple stakeholders.  An absence of effective communication can foster distrust and misunderstanding.  A truly ethical company engages and understands important stakeholder matters – not because of the positive PR, but because it’s the right thing. 

Producing ethical outcomes involves leadership since it’s often challenging to go against the flow.  Effective communication includes listening and understanding views from the other side of the table, not just dictating from a rehearsed script.  Business has an obligation to behave ethically because there’s more on the line than the bottom line.