As an MBA student focusing on Human
Resource and with an interest in
working with organisational leaders,
when discussing ethics I am curious
about the practical application of ethics
in business in the context of leadership
and how this works in a company like
To begin discussing ethical leadership,
ethics, leadership, and business ethics need to first be examined
Ethics: Two major schools of
a) Deontological: One should
be moral or
ethical for themselves, in that
regardless of the result the
action should be moral or
ethical (Still 2017).
b) Teleological: The ends
justify the means, in that the
results of the action that matter (Still 2017).
Let’s put them to the test to examine them. Should ethics be sold as a positive
result for the bottom line as so many ethical leadership books claim (Becker
2007), or should there be a deeper understanding of people, as Dan Ariely
(2008) suggest that we all like to see ourselves as ‘good’.
Dan Ariely: The (Honest) Truth About Dishonesty
Dan Ariely: Why we think it’s OK to cheat and steal (sometimes)
Ariely’s (2008) research describes as a person’s ability to use internal
arguments to convince ourselves that we are still a good person and cheat at
the same time as rationalisation (Mazar et al 2008). This supports a
deontological ethical theory, in that we see ourselves as good, however we are
able to bend this to teleological by justifying our current actions for end gains.
Thomas Aquinas argues that there
are three requires to examin an
1) The observable act
2) The motive of the person
3) The circumstances affecting the
act (Mendonca 2007: 13)
Leadership: The most important
aspect of leadership is having someone follow you (Kiger 2010), without
followers, a leader is nothing (Sivers 2010) empowering a leader as a role
model (Kiger 2007). In terms of ethics, this requires leaders to ‘walk the talk’,
and demonstrate ethical behaviour, which according to May and Pardey’s
research (2013) found that most organsations made decisions in-line with
their values and codes of ethics.
Businesses: In order for the business
world to function trust based on
ethical behaviour is required, and
businesses decisions are not fully based
on economical requirements (Becker
2007). Today, corporate social
responsibility (CSR) is becoming
increasingly important (Mullins 2014:
513), as we can see in the example of
with Starbucks is CEO
Howard Schultz, his regular
emphasis of ethics can be
found in the company’s
operations, such as sourcing
fair-trade coffee, treating
employees fairly, and
promoting diversity (Fellner
2008; Starbucks 2017). With
over 9000 licensed stores
worldwide (Lemus et al 2015)
their ethical claims raise
greater issues with critics. A quick Google search for ‘Starbucks’ and
‘unethical’ turns up a plethora of websites and videos criticising Starbucks’
1. Is Starbucks coffee ethically sourced? Do farmers get a fair wage based
on unethically sourced coffee or based on the marked-up price
2. Is Starbucks ethical to their employees, or does it stop their employees
3. Is Starbucks simply capitalising off of selling an “ethical” dream to
those willing to pay to feel good.
(Unknown no date)
Though Shultz can demonstrate ethical leadership and claim ethical business
practices, however any decision made against this will be highly
criticised (Fellner 2008). Leaving it to question, is Starbucks ethical because
it’s good to be ethical or is it ethical because people like to think they are and
through well-planned marketing, Starbucks is just capitalising on people’s
deontological ethics and viewing themselves as ‘good’.
From this discussion, we can conclude that ethics is a part of
everyday business and ‘should’ be part of an organisation’s overall
strategy. The question still remains, should decisions be based on what is
ethical for shareholders or should they be based on what is ethical for all
stakeholders? This is further complicated with the growing importance of
corporate social responsibly, which includes being ethical to all stakeholders –
including communities, the environment, and even future generations
(Mullins 2014: 518 – 524).
1)People see themselves as good,
so a leader can use this to their
advantage improving ethical
behaviour in an organisation and
to promote an ethical image to
2) Senior management is
responsible for the decision
3) Ethics should align with business strategy and ‘should’ be included in
economic decisions, leaving the organsation to determine if it should be
ethical to shareholders or stakeholders.
Check out my vlog #1 where I get into the information above at a deeper level:
Adobe, (2016). Fotolia. Online
Accessed 15 December 2016.
Becker, G.K. (2007), “The Competitive Edge of Moral
Leadership”, International Management Review, vol. 3, no. 1, pp. 50-71,138-
Fellner, K. (2008). Wrestling with Starbucks, edited by Kim Fellner, Rutgers
University Press. ProQuest Ebook Central.
Kiger, PJ (2010). The leadership formula, Workforce Management, 89, 5, pp.
25-31, Academic Search Complete, EBSCOhost.
Lemus, E, von Feigenblatt, O, Orta, M, ; Rivero, O (2015). ‘Starbucks
Corporation: Leading Innovation in the 21st Century’, Journal Of Asia
Pacific Studies, 4, 1, pp. 23-38, Academic Search Complete, EBSCOhost.
May, T. ;. P. D., (2013). ILM Research Paper 2: Values ; ethics in
management, London: ILM ; BITC.
Mazar, N., Amir, O. ; Ariely, D., (2008). The Dishonesty of Honest People: A
Theory of Self-Concept Maintenance. Journal of Marketing
Research, XLV(December 2008), pp. 633 – 644.
Mendonca, M., and Kanugo, N. R. (2007). Ethical Leadership, edited by
Manuel Mendonca, and Rabindra N. Kanungo, McGraw-Hill Education.
ProQuest Ebook Central.
Mullins, L., 2013. Management and Organisational Behaviour. 10th ed.
Harlow: Peasrson Education.
Starbucks, (2017). Starbucks: Our Responsilbity. Online
Accessed 24 February 2017.
Sivers, D., (2010). YouTube: How to start a movement – TEDTalks. Online
Accessed 25 January 2017.
Still, C., (2017). Leadership ; Ethics – Instructions Unit One. Online
Accessed 28 January 2017.
Unknown, no date. Scribd: The Truth Behind Starbucks. Online
Accessed 21 February 2017.