Today business is subject to new and greater pressures and external factors, including regulatory changes. One of the biggest challenges comes from globalisation. As such, companies are confronted with different standards of values and practices.
In view of a growing string of failures of dubious business ethics, world's business leaders have woken to the necessity of ethical leadership. Nevertheless, ethical leadership is not merely a necessity, it is now an opportunity - a source of competitive advantage for companies and a tool with which to add business value.
Once an organization is regarded as corrupt, its level of legitimacy declines. With declining legitimacy, the call for more regulation will grow louder, stifling the organization concerned and the whole economy. More laws will come into effect, making business even more difficult. The corollary is that, in a system when one organization subverts the law, it becomes much harder for other companies to operate cleanly.
This is where Ethical Leadership is a necessity. Only if management sets clear, unequivocal policies and controls stipulating zero tolerance, can management ensure good practice.
But by seizing on Ethical Leadership as an opportunity, a manager could actually enhance his or her reputation inside the firm. By exercising Ethical Leadership, managers inspire and generate confidence in individuals at all levels of the company.
There has always been a necessity for the industry in gaining consumer trust and confidence. With ever growing competition in the market place, Ethics has been the key driver in creating and defending and enhancing 'Reputation' and 'Confidence of a brand', through transparency, free flow of information, and good governance.
Ethical Governance presents us with a great opportunity to differentiate from the competition in the market - to add value. A company which is known to be secure and run on ethical principles will be more trusted by customers, shareholders and investors, and it will be more successful than those less ethical companies.
In summary, by operating with a social conscience, the ethical leader does not just build confidence and loyalty with staff, but builds goodwill in the market, community and society at large.
Ethical Leadership is not without its challenges. For instance, ethics are often highly personal. Nor can Ethical Leadership be instilled in an organization or corporation overnight.
Ethical Leadership requires habit, and it requires proper regulations. Education and communication must be further enhanced, Ethical issues must find and gain support in the work place and also in the society, and finally there must be proper motivation and recognitions given for those wishing to pursue Ethics.
Monday, November 2, 2009
Building Ethical Governance
"Let us dismiss hypocrisy and enhance democracy
By changing the process
to measure our progress"
Exercising power and decision-making for a group of people is called "Governance". It happens everywhere – from urban centres to rural villages – and the well-being of a community depends on the choices made by people granted this authority. Because of the diversity of organizational structures around the world, people such as land lords, heads of associations, cooperatives, NGOs, religious leaders, political parties and of course, government are all actors granted the power to govern.
“Ethical Governance” is a relatively new term that is used to describe the performance issues in management and policy making in business, government, politics, International relations, health care, etc. The principles of Ethical Governance, however, are not new. Ethical Governance is, in short, anti-corruption whereas authority and its institutions are accountable, effective and efficient, participatory, transparent, responsive, consensus-oriented, and equitable. These are the major characteristics of good governance as outlined by the United Nations.
Ethical Governance is integral to sustainable growth, stopping financial meltdowns and economic degradation, eradication of poverty and income inequalities and also to acheive high standards of ethical conduct, in the areas of human rights, labour, environment and anti-corruption.
For Ethical Governance to succeed in both theory and practice, there must be transperancy, openess, information flow, degree of congruence in communication. Although widespread information flow and accessibility could remain a barrier for many, one of the ways to overcome, is through effective use of Information and Communication Technology (ICT) and the implementation of e-governance.
By changing the process
to measure our progress"
Exercising power and decision-making for a group of people is called "Governance". It happens everywhere – from urban centres to rural villages – and the well-being of a community depends on the choices made by people granted this authority. Because of the diversity of organizational structures around the world, people such as land lords, heads of associations, cooperatives, NGOs, religious leaders, political parties and of course, government are all actors granted the power to govern.
“Ethical Governance” is a relatively new term that is used to describe the performance issues in management and policy making in business, government, politics, International relations, health care, etc. The principles of Ethical Governance, however, are not new. Ethical Governance is, in short, anti-corruption whereas authority and its institutions are accountable, effective and efficient, participatory, transparent, responsive, consensus-oriented, and equitable. These are the major characteristics of good governance as outlined by the United Nations.
Ethical Governance is integral to sustainable growth, stopping financial meltdowns and economic degradation, eradication of poverty and income inequalities and also to acheive high standards of ethical conduct, in the areas of human rights, labour, environment and anti-corruption.
For Ethical Governance to succeed in both theory and practice, there must be transperancy, openess, information flow, degree of congruence in communication. Although widespread information flow and accessibility could remain a barrier for many, one of the ways to overcome, is through effective use of Information and Communication Technology (ICT) and the implementation of e-governance.
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