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Importance of Ethical Leadership in Business

Just as moral principles tend to guide an individual’s decision-making, those same values and directives can help a business set a code of behavior for its leaders and employees.i

Ethics represent the standards that determine business decisions every day. These affect the way a company operates and how it treats employers, customers, shareholders and the community in which it’s located. These ethics have ramifications when it comes to corporate governance, social entrepreneurship and even hiring practices. Learn more about ethical behavior in business with Manhattan's Master of Business Administration.

In a global arena, staying true to ethical considerations can be a valuable way for a business to stay true to its primary mission. For example, a company that’s focused on customer service above all else — even shareholder happiness — can see any deviation from that course as leading to murky ethical waters.

Role of Leadership

Although organizations are expected to adhere to a certain set of ethics, examples of ethical behavior need to start with leaders within the organization.

The importance of leadership as the driving force for ethical practices can’t be underestimated. Often, these top executives set the tone for every decision made within a company, no matter how small.

Those who lead ethically are considered role models who can hold themselves and their employees accountable. They make ethical culture a part of every function in an organization, from hiring and training through performance management and mentoring programs.ii

The results can be profound, and researchers have noted that employees who rate their leaders as more ethical have much higher job satisfaction and engagement levels. Employees are less likely to leave an organization because they’re attracted to ethical role models who treat them fairly, express support for their efforts and set consistently high ethical standards.iii

It’s no wonder then that ethical leaders are in such demand. Workplaces are evolving to become more transparent, collaborative and employee-centered, which fuels the need for leaders who can apply ethics in meaningful ways.iv

The Importance of Leadership in Education

While some people tend to be inherent leaders, others may learn leadership skills through formal education and training.

At Manhattan College, the role of ethics plays a significant part of Master’s Degree in Business Administration Program. Manhattan College recognizes the importance of ethical leadership in business and the need for more business leaders who are well versed in the nuances of ethical practice.

Gaining a practical understanding of ethical theories, students can use these insights to solve real-life business problems as well as personal and professional challenges.

Emerge a Transformational Leader.

To learn more about Manhattan College’s Online Master’s Degree in Business Administration, request information or call (855) 841-2843 to speak with Admissions.


i“What are business ethics?” Business Case Studies. http://businesscasestudies.co.uk/anglo-american/business-ethics-and-corporate-social-responsibility/what-are-business-ethics.html#axzz4NY8AYehg (accessed 10/19/16).
ii“Leadership.” EthicalSystems.org. http://www.ethicalsystems.org/content/leadership (accessed 10/19/16).
iii“Leadership.” EthicalSystems.org. http://www.ethicalsystems.org/content/leadership (accessed 10/19/16).
ivLlopis, G. “5 Ways leaders earn respect from their employees.” Forbes. http://www.forbes.com/sites/glennllopis/2013/07/22/5-ways-leaders-earn-respect-from-their-employees/#612cd1c42f40 (accessed 10/19/16).