Ethical leadership is needed as pandemic threatens bottom line
Governing bodies should consider effect of organisations’ decisions on community and natural environment
Crisis has the potential of bringing out the best and the worst in human beings. We have already seen much of both in the coronavirus crisis.
We have seen gestures of goodwill from people and organisations making substantial sacrifices to serve the wellbeing of those who are detrimentally affected by the pandemic. We have also seen gross unethical conduct by other organisations; charging excessive profit margins on essential items, submitting fraudulent applications to relief funds, or blatantly ignoring the measures announced to curb the spread of the virus.
How should organisations think about their organisational ethics in the time of corona? Is this a time to suspend moral responsibility? For claiming that we are now in a state of survival, where it is a case of “bread first, morals later”? No, it is a time for walking the extra moral mile, and for exercising moral imagination. So what are the ethical responsibilities of leaders of organisations in this time of crisis?
Ethical leadership has become more important in steering organisations through this crisis, as well for recovering from the crisis. There is widespread anxiety and uncertainty worldwide. Leaders of organisations are worrying about the repercussions of the pandemic and neglect their moral obligation to look after employees’ health and sanity.
We should be well aware that organisations will not be able to recover from, or flourish, amid a declining economic, social and natural environment
Timely and accurate communication by leaders is required to calm fears and anxiety, to create realistic expectations, and to ensure that commitment and collaboration of all stakeholders are maintained.
Governing bodies of organisations have special moral duties to support the executive leadership of the organisations they govern. They should be hard at work, digesting not only the strategic implications that the pandemic might have on the performance and sustainability of the organisations that they govern, but also considering the impact of the organisations’ decisions and actions on the community and the natural environment.
Social and ethics committees of boards should put in extra time and effort to provide strategic advice to the executive leadership on balancing the short-time survival of the organisations with the longer-time health of the social and economic environment. We should be well aware that organisations will not be able to recover from, or flourish, amid a declining economic, social and natural environment.
In times of crisis leaders are faced with tough choices, such as: should I put the health of my employees or their economic survival first? If I face a cash-flow crisis, who should be given priority in terms of payments? Should we have salary cuts across our organisation, or should we first trim at the top?
Health-care professionals face even tougher choices: I only have three ventilators available, but five or 15 patients that depend on these three ventilators to save their lives — who should be given priority? What are the most relevant criteria: age, wealth, education and influence, or should we treat them merely on a first come, first served basis?
All such questions are genuine moral dilemmas, which could only have a less than optimal outcome. It is seldom a case of choosing between what is morally right and wrong in such circumstances. It is rather a case of doing as little evil as possible. In situations like these, leaders in organisations cannot rely on ready-made answers that can be downloaded from a platform, or on algorithms that can solve the tough choices on their behalf.
It requires leaders to go through the process of consulting with others, but also consulting their own conscience and values. It demands moral reasoning to come up with the best possible solution while still carrying the weight of the knowledge that there will be collateral damage.
It is times and dilemmas like these that call on organisational leaders to ignite their moral imagination, and to start thinking above and beyond business as usual. We need moral imagination not only to deal with ethical dilemmas as mentioned above, but to also try to prevent such moral dilemmas from occurring in the first place. What can we do now to prevent us from facing such tough choices in future?
The way in which leaders steer their organisations through this crisis will not only determine whether organisations are able to weather this storm. It will also determine how organisations emerge beyond the pandemic.
The quality of ethical leadership practised in the storm will determine the trust staff, suppliers, clients and society will have in organisations when they emerge on the other side of this crisis.
Trust hinges on ethics and competence, but the greater of the two is ethics.
• Prof Rossouw is CEO of The Ethics Institute