Doing What’s Right: Why Ethical Leadership & Corporate Responsibility Isn’t Just A Big Business Issue

David Pich (pictured below) is the chief executive of IML ANZ and co-author of Leading Well. Pich advocates passionately for sound management and leadership practice and strongly believes that good leaders have an impact well beyond the workplace. In this guest post,

These days it appears that things must be bigger than before – the most-read, the most-shared or the most-talked-about. It’s all about impact; being bigger than big. The problem with this is that smaller actions can appear to lack impact. Anything that isn’t big, bigger or the biggest can seem to be futile and not worth doing.

In terms of ethical leadership and corporate social responsibility, this thinking is dangerous. The idea that ethical behaviour and ‘doing the right thing’ is a large corporate issue and applies only to the big end of town might seem appealing, but in my view it’s a dangerous one. The answer to the question, “Does the size of your business determine whether or not we behave ethically?” is a resounding no.

In my experience leading an organisation that represents managers and leaders who wish to raise the standard of our profession across our region, nothing could be further from the truth. Small actions by managers and leaders absolutely contribute to – and are fundamental to – the ethical fabric of the workplace and of society more generally. It is not enough for managers and leaders to look to the banks and to huge mining companies – or to large overseas multinationals – and to say that ethical leadership is ‘their issue’. Ethical behaviour and corporate social responsibility begins at home. It starts with each individual manager and leader in every business – large or small. Or indeed, very small.

Amongst our membership of close to 10,000, around 25 per cent work for themselves or for small partnership type businesses. In a recent survey of our Members, we found that ethical leadership and corporate social responsibility (doing the right thing!) were amongst the top issues for today’s managers and leaders. Members said that it is the cumulative actions of all leaders across all businesses – large and small – that will have an impact. It’s the managers and leaders in SMEs that are critical in the fight to increase ethical behaviour.

Here are three reasons why:

Leaders need integrity

Today’s leadership climate is marked by an erosion of trust and cries of a global leadership crisis. It’s not surprising then that the integrity of leaders is under scrutiny. Leaders therefore need to increase their credibility through their actions. But doing the right thing mustn’t be limited to benefiting yourself, your team and your business. That’s because the right thing often encompasses more than the four walls of your office. Ethical behaviour involves our community and society. So doing the right thing is the responsibility of every manager and leader – whether you lead a small or large team.

Attitudes have changed

I once had the privilege of interviewing Nobel Laureate Kailash Satyarthi. His work in eradicating child labour earned him the Nobel Peace Prize in 2014. Satyarthi told me that the attitude of the business community towards corporate social responsibility is changing. There was a time when businesses were happy to simply donate to charity. Then many companies started to volunteer and become more involved. Now there is a new stage, where supply chains are scrutinised, and due diligence is done. Leaders of small businesses cannot afford to fall behind in their attitude towards corporate social responsibility. They need to remain relevant in a world where consumers demand that companies do the right thing.

Opportunities abound

Among our members, some have decided to go out of their way to set-up consultancies that provide business development services to help small businesses. One such consultancy is focussed on assisting small business with their climate change efforts. The need to do the right thing by the community is now becoming the norm rather than the exception. We can all expect to see an increase in opportunities for leaders to step-up and contribute – regardless of the size of their company.

It seems clear to me that when it comes to ethical leadership, we are all citizens of the same global, interconnected society. Business is not done in a vacuum and even very small businesses operate as part of a global whole. All of our actions, no matter how small, are interconnected. My challenge to all leaders is to do the right thing consistently. What that looks like for your business may very well be different from what others are doing. But, when it comes to ethical leadership and corporate social responsibility, the worst thing that we can do is nothing.