Last time, we examined how a leader can turn around an organization with his plans, policies and actions. The critical role of leadership virtues and its impact was also highlighted. In this post, we will be reviewing some other examples of leaders whose actions and inactions had consequences on the organization they led. An example worth studying is Travis Kalanick who led Uber as CEO from 2010 to 2017. His leadership style prioritized aggressive growth over collaborative input or consideration of the company’s internal culture. His leadership approach also sparked widespread controversy, raising questions about corporate ethics, workplace culture and the broader implications for the tech industry. This led to ethical lapses at the top and the culture of the organization became increasingly cutthroat, deceitful, and oblivious to rules and ethics.
Employees were immersed in a scorched-earth ethos where beating the competition justified virtually any means necessary – including stealing trade secrets, using software to evade regulators, and marginalizing those who raised concerns. During Travis Kalanick’s tenure, Waymo, a self-driving car firm owned by Google’s parent firm Alphabet, accused Uber of stealing trade secrets. Waymo alleged that Anthony Levandowski, a former employee, downloaded 14,000 confidential files before leaving the company in 2016 and later joining Uber to head up its self-driving car project. Eventually, a court filing indicated that Travis Kalanick may have known that the star engineer, Levandowski, possessed stolen trade secrets. At the end, Kalanick resigned to allow the company to move forward.
In any family, organization, state or nation, the culture is shaped from the top down. The virtues and values embodied by the leadership ultimately permeate through the ranks, setting the standards for what behaviors are acceptable or unacceptable. A leader who allows toxic conduct to fester is giving it permission to proliferate. Conversely, a leader who demonstrates and demands virtuous behavior creates a positive environment where ethical practices can thrive. Sometimes even a saintly leader must make tough calls to restore virtuous conduct. Whether in crisis or boom times, leaders must model the virtues they wish to instill throughout their organization with consistency and authenticity. By leading with humility, integrity, and care for people over narrow self-interest, leaders can shape organizational cultures of ownership, cooperation, and ethical conduct.
Ethical leadership also fortifies relationships and trust with stakeholders outside the company. After all, why would customers, partners, and society place their faith in an organization whose leaders enable or ignore corruption? However, should leaders fail to embody virtuous conduct themselves, it gives everyone else license to indulge their worst impulses too. A leader’s hypocrisy in preaching integrity while simultaneously engaging in nepotism, deception, or other misdeeds undermines their authority and spreads a corrosive cynicism across the organization. Before long, employee motivation, candor, and productivity begin to plummet – all while unethical conduct balloons out of control.
Just as the fish rots from the head down, so too do organizations. Leaders carry an outsized responsibility to model and enforce the ethical standards they wish to permeate their workforce and organizational culture. To drive success over the long-term, they must walk the walk rather than just talking the talk when it comes to embodying virtues like integrity, humility, self-discipline, and care for stakeholders. Leaders who fail to uphold these virtues through their own actions ultimately undermine their entire organization and open the door for dysfunction, demoralization, and catastrophe.
In closing, two companies whose leadership have used their position as a beacon of organizational virtue and success are Costco retail stores and Lincoln Electric. The CEO of Costco, Craig Jelinek who was in office from January 2012 to January 2024 cultivated humility, thrift, and respect for employees through measures like capping executive pay, providing generous wages, benefits, and prioritizing employee development. This virtuous leadership helped attract top talent and galvanized a motivated, high-trust workforce. Also, the CEO of Lincoln Electric from 2012 to 2023, Christopher L. Mapes, prized ethical conduct, teamwork, and accountability, and introduced the incentive-based compensation system. Under his leadership, Lincoln Electric was recognized as one of the world’s most ethical companies