Unless you have a very particular interest in canals, Panama has probably occupied more of your thinking in the last month than at any time previously. The release of the “Panama Papers” and the continuing fallout from the revelations they contain has granted the Central American country a level of attention it has not enjoyed in a very long time.
For the sake of clarity, and to avoid drifting into the mire of accusations the Papers have produced, let’s stay resolutely away from the revelations themselves and instead pick on just one broad aspect.
A common theme that has emerged in the response has been a widely-held perception of unethical behaviour demonstrated by an elite group of leaders from world politics, from big business, and elsewhere. Some of what has been revealed is not necessarily illegal; indeed, some of the discussed activity has been meticulously and resolutely arranged so as not to be against the law. Rather, it is the behaviour that is said to run counter to the spirit of leadership that some of the actors involved should be aspiring to. It appears unethical, untoward and underhanded.
Ethics in leadership was a major talking point in a recent Harvard Business Review article by Sunnie Giles: “The Most Important Leadership Competencies, According to Leaders Around the World”. As the title suggests, Mr Giles conducted an in-depth study of 195 organisational leaders around the globe, asking them to select the leadership competencies they personally believed were the most important priorities from a sizeable list of options.
What emerged from this research was a strongly stated belief in the central importance of ethics in leadership. Indeed, at the very top of the list, selected by 67 per cent of leaders, was the statement: “[a leader] has high ethical and moral standards”.
This seems a resounding statement that ethical behaviour is highly rated by those who are leaders. And this is hardly surprising. In leadership, ethical and moral standards will be realised as decisions that are undertaken honestly, fairly, and with a keen appreciation of equality. It will see actions taken that are in line with a leader’s own core values, as well as the values of their organisation and those of a population at large. Ethics in leadership are always likely to be highly-rated and desirable because to be an ethical leader is to be essentially good.
However, the awareness of a need to act ethically and the actual practice of it are not necessarily linked. One interesting aspect of this discussion is the concept of power and position having a negative effect on the individuals that hold them.
One explanation for such a suggestion is that those at the top end of an organisation uniquely possess the capacity to act as they please. Such an assertion might assume that we are all similarly capable of unilateral unethical behaviour if only we also had the capacity to undertake it. Another view is that leadership positions remove individuals from much of a society – whether that’s a single workforce or an entire populace – and thereby throws off their perception of what actually constitutes reasonable, ethical behaviour.
At the same time, the vast majority of leaders will, with work, maintain an essentially ethical stance through the many decisions they make, and with very good reason. If business leaders can take a lesson from the public response to events in Panama, it might be this: ethics in leadership are as strongly valued by the people being led, as by the leader themselves.
This isn’t because people want to believe in a kind and cuddly individual at the top. It is because ethical conduct that a leader continually seeks to develop will demonstrate consistency and reinforce belief in the direction a company is taking.
Of course, it has the practical benefit of helping keep a company on the right side of legal behaviour, but it also serves to show employees that a leader is acting honestly and fairly, with standards and values they apply equally to themselves and to others.
Ahmad Badr is chief executive of Abu Dhabi University Knowledge Group.
Follow The National’s Business section on Twitter