Why Ethics is Essential to Success

Three important shifts are reshaping the business environment where ethics is fast becoming a new competitive advantage:

  • Widespread and growing customer distrust of business post-GFC.
  • Instant access to data and social connectivity is making corporate spin redundant and transparency essential.
  • The collective judgement on ethics in business is intensifying, following the News International phone hacking scandal.


Companies that ignore ethical leadership will begin to suffer. Here are four recent examples:

  • Goldman Sachs brand value dropped -16% in the 2012 Interbrand Best Brand Report, showing it is still suffering after company executive Greg Smith resigned in an open letter to the New York Times in March citing the firm bet against its own clients and operated at odds with its customer values. Goldman Sachs then lost US$2.15 billion in market valuation in a single day.
  • Ikea was lambasted worldwide for airbrushing photos of women out of their catalogues for the Saudi Arabian market.
  • JPMorgan was sued by the NY Attorney General for fraud over mortgage securities.
  • The public demonstrations against the cruel treatment of animals in the Australian live export trade show consumers rallying for ethics.


But what are corporate ethics? There are three levels.

  • The Individual – Employee engagement, individual respect and a culture of transparency, open communication, objectivity, fairness and diversity of opinions.
  • The Organisation – Operating true to core values, shared objectives and purpose; collaboration, camaraderie, trust and a passion to achieve success together. An inclusion of the long term view as well as short term needs in decision-making.
  • The Community – Broadening objectives beyond just profit to a consideration over how that profit is made and making a relevant contribution to the communities your organisation impacts or to the sustainability of our planet.

A lack of ethics is holding organisations back from a lucrative growth opportunity. There is a gap within most companies between actual performance and potential performance, estimated in the U.S to be worth US$100 billion. People, passion and purpose are the three biggest variables in performance, and each one can be ignited with ethical leadership:


Ethics is Home Ground Advantage

Take a look at any great sporting rivalry. Say, FC Barcelona versus Real Madrid which is the most followed club football match in the world after the UEFA Champion’s League final. Both sides have the very best players and coaches money can buy, both have complex strategies covering every inch of the field, both have exhaustive data on every player’s strengths and weaknesses, both have peak team fitness and professional sports psychologists.

But what’s the biggest single variable in performance on the day? It’s home ground advantage.

It’s incredible that a bunch of screaming fans can make the difference between an everyday performance and an exceptional one, by inspiring a team to greatness.

But this huge internal boost in performance would not be possible without organisational ethics. It needs the team to have an unbreakable bond of camaraderie, collaboration, trust and a commitment to shared values. It needs every member of the team operating at his own peak performance and encouraging his team-mates to do the same. It needs a commitment from everyone to become part of something greater, something inspirational, something worth winning for.

Ethical leadership enables your organisation to create and leverage this huge new, untapped growth accelerator.


Five Rules for Ethical Success:

  • Engagement: Companies must engage their people, their values and their future as well as their customers; not drift away from them.
  • Critical Thinking: Objective decision-making trumps subjectivity every time, and corrects management on auto pilot. Encourage healthy conflict and diversity in thinking.
  • Collaboration: Collaboration is the key to unlocking productivity, innovation, responsibility, sustainability and growth; as well as happiness and learning.
  • Ethics: Companies must begin a deliberate debate on ethics to purposely evaluate what’s right for them; and the communities they serve.
  • Simple Solutions for Complex Problems: If you’re trying to win, you’ll lose. Just play your best possible game and enjoy the process.

Lionel Messi, Barcelona’s front man and one of the greatest footballers of all time was quoted in Time Magazine’s Most Influential People in the World issue on 30 April 2012 on valuing team success over personal glory.

Messi said “Goals are only important if they win you games.”

How can you re-think ethics in your organisation to position yourself for growth and create a commanding leadership position? How much of a competitive advantage can your business gain if your people, passion and purpose are ignited?

And that’s why I launched The Ethics of Success – to help organisations gain this advantage.