Date posted: 6/02/2019 3 min read

Ethical leadership drives organisational success

CA ANZ President Stephen Walker talks to Professor Karin Lasthuizen about the benefits of ethical leadership.

In Brief

  • Research shows most NZ organisations aim for ethical leadership
  • Ethics in business is more than “being honest”
  • Ethical leadership involves transparency, accountability and creating a safe workplace that fosters employee growth.

Chartered Accountants Australia and New Zealand President Stephen Walker strongly values ethical leadership, which is a key focus area of his presidency. He will be encouraging the organisation to look at how ethical issues affect members and what can be done to support a focus on ethical leadership.

Walker recently talked with Professor Karin Lasthuizen, the Brian Picot Chair of Ethical Leadership at Victoria University in Wellington, New Zealand, about the outcomes of her research, the meaning of ethical leadership, and key ethical issues in New Zealand's organisations across sectors and cultures.

Challenges of implementing ethics across the organisation

Professor Lasthuizen says there's a common misconception regarding ethical leadership that can hamper its effectiveness. Being ethical, she says, is about more than just being honest. While everyone in leadership ranks may be well intentioned, Professor Lasthuizen says no-one should rest on their laurels, or assume everything is "fine" when it comes to rising to the challenge of ethics in business.

"This whole idea of ethical leadership is not just about being an ethical person yourself, but about cultivating that behaviour among employees and within the organisation...achieving this is no easy feat."
Professor Karin Lasthuizen, Brian Picot Chair of Ethical Leadership, Victoria University of Wellington.

Creating a safe environment for employees to approach their roles from an ethical standpoint requires leaders to have a significant level of awareness. It may sometimes involve uncomfortable experiences, such as admitting when you haven't upheld the code of ethics yourself, but this is the kind of accountability and transparency that ethical leadership is built on.

Positive gains to be made from ethical leadership

Part of Professor Lasthuizen's 2017 research into the meaning of ethical leadership in New Zealand involved studying interview responses from 40 key professionals from the public and private sectors as well as the general populace.

The majority of findings suggest that effective ethical leadership can result in increased job satisfaction, productivity and economic expansion.

"Ethical leadership is a really good overall leadership strategy because if people feel better… they are more committed, loyal and basically, they work harder… and then you get a better economic performance," Professor Lasthuizen said.

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Leading for integrity - Professor Karin Lasthuizen’s inaugural research lecture

Learn more about the effective implementation of ethical leadership and its benefits.

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