Are You a Good Leader?

(page 2 of 2)

What such predators don't realize is that in the long run, their practices will come back to haunt them in the form of bankruptcy filings, bad PR, and perhaps even prison time for the worst offenders. The good leader recognizes that preventing harm to clients and company alike is both an ethical responsibility and a wise business policy.

6. DON'T EXPLOIT.

It is easy to take advantage of a situation for financial gain, but doing so isn't consistent with good leadership. After Hurricane Ike hit last year, the wholesale price of gasoline shot up, which was nothing more than price gouging.

In the short run, companies that exploited a natural tragedy may have profited financially, but the long-term negative consequences are real and significant: In New York State, for example, more than a dozen companies were fined more than $60,000 for unfair business practices following Hurricane Katrina. Of course, the reason to do the right thing is simply because it is the right thing to do. But it is also true that taking the low road can be harmful professionally and personally.

7. DON'T MAKE PROMISES YOU CAN'T KEEP.…..

…and keep the promises you make. There are rare circumstances in which we not only have a right but an ethical obligation to break a promise, but generally speaking, we have a strong duty to be true to our word. This is, after all, one of the primary ways that we show our respect to people. Recall that last March, Dr Pepper said it would give out free cans of soda to "everyone in America" if Chinese Democracy, the long-overdue album from Guns 'n' Roses, came out by the end of the year. When Axl Rose surprised the music world by releasing the album in November, the beverage company was unable to deliver a soft drinksto everyone who wanted one (Whether it's ethical for a band that has only one of its original members to call itself "Guns 'n' Roses" is another matter.) Good leaders are careful to make only those promises they are likely to keep and keep the promises they do make. When they are unable to keep those promises, they own up to it, which brings us to the next rule of good leadership:

8. TAKE RESPONSIBILITY FOR YOUR MISTAKES.

Transparency and accountability should be the new buzzwords. This means, in part, that business leaders who make mistakes should apologize to those they have let down and do whatever is necessary to make amends. In the wake of the toy industry's lead-paint scare in 2007, Mattel CEO Robert Eckert took the high road and told a Senate subcommittee that the company failed "by not closely overseeing subcontractors in China whose toys didn't meet U.S. safety standards," and that Mattel was working with the Consumer Product Safety Commission to ensure that these products would be safer. It must have been extraordinarily difficult for Eckert to apologize publicly, but by finding the courage to do so, he demonstrated ethical leadership.

9. PEOPLE, NOT PROFITS.

We often recite—incorrectly—President Calvin Coolidge's statement, "The business of America is business." (What he actually said was, "The chief business of the American people is business.") But far more important is what followed that statement: "Of course the accumulation of wealth cannot be justified as the chief end of existence." Coolidge's policies are often blamed for bringing about the Great Depression, but if enough people had heeded the latter statement, perhaps our history would have been different. Money has no intrinsic value; it is good only for what it can get us. For the good leader, this means that the ultimate goal in business—and life—is not hoarding riches but making things better for all, especially the neediest.

10. BE KIND, NOT KING.

The relentless quest to be No.1 can blind us to what's really valuable in life: being a decent human being. Yes, good leaders are enthusiastically devoted to accomplishing their mission, but this pursuit cannot be at the expense of the well being of others. For example, leaders with the unenviable task of letting people go will avoid taking the easy way out . No one likes being the bearer of bad news, but the good leader does so with the dignity that leadership of the highest order demands.

BONUS RULE: YOU ARE NOT YOUR CAREER.

It's admirable to be passionate about your job, but passion can easily become obsession, and that's where the danger starts. When your life's work becomes your life, it is time to take a step back and reevaluate your priorities. I've already shown why you ought to take vacations and stay home when you're sick. More critical than either of these is recognizing what's really important in life—and it's not your career, no matter how satisfying that may be. Good leaders not only make room for family, friends, and spirituality; they know these are the things that truly make life worth living.

It should be obvious by now that the above rules apply not just to those in the financial sector but to everyone else, too. They are, after all, based on the five fundamental principles of ethics: Do No Harm, Make Things Better, Respect Others, Be Fair , and Be Loving. As Peter Drucker pointed out, it is not enough to do things right; we must also do the right things. The good leader today is concerned not only with getting from A to B, but with deciding whether B is worth getting to in the first place.

Dr. Bruce Weinstein is the public speaker and corporate consultant known as The Ethics Guy. His new book, Is It Still Cheating If I Don't Get Caught?, (Macmillan/Roaring Brook Press) shows teens how to solve the ethical dilemmas they face. For more information, visit TheEthicsGuy.com.