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Ethical leadership requires courage

I suggest that the ‘chimera’ of shareholder dividends ravages society, and sometimes topples businesses.

The Enron scandal is a perfect example to use for this.  Skilling, the greedy individual that not only destroyed a company, losing its employees and shareholders millions, also destroyed a CPA firm along the way. Sharon Watkins, the whistle blower, had to start her own company to survive.

The concept ethics has been studied and discussed throughout recorded time, such as the leadership and writings of Buddha and Confucius, and in western cultures Plato and Cicero.  These leaders/writers, and their successors, attempted to define ethics. This shows that the idea of ethics is a universal truth, but its definition is elusive, depending on culture and time.

Hobbes’s Leviathan, an unabashed look a humanity, says, we are born with appetite (hunger, drive, determination, need).  Appetite must be satisfied, but how it is satisfied is the question – is it for personal pleasure, grabbing everything for ones’ own family, or can it be something else?  Modern parents are expected to re-purpose appetite/satisfaction into something acceptable by society, which is suborned by television, internet, print, and radio hawking consumerism through sexism by objectifying women and wealth in advertising.

Kohlberg’s Stages of Moral Development:

The Kohlberg process of appetite to ethics includes:

Level 1 would consist of the inconsiderate demands of a hungry newborn baby

Level 2 is elementary and secondary education, where the individual can accept or deny the demands of appetite, through accepting re-purposing

Level 3 is attained with age and/or experience, where re-purposing is brought to its zenith.

The re-purposing of appetite achieved by family or societal pressures determines how a child is directly influenced – these forces include parents, church, peers, teachers, mentors, the media and more.

In a company, shareholder dividends take on the status of Level 1, or demand the most possible money now, and damn the consequences.  Level 2 includes people who are compromised by appetite, and do not think they have the power to moderate that appetite.  The level 1 demand by shareholders is two-fold – their participation in the activities that create the money is widely separated, and also because of how little shareholders receive from their investment. Level 2 individuals are either compromised by the promise of wealth or cowed through fear of losing their job.  Level 1 and Level 2 individuals are further pressured by how expensive it is to finance a middle-class life of consumerism.

An example of level 3 is when a worker perceives injustice, and gathers the courage to effect change.  For example, a whistle-blower (who is usually severely punished for it) when he/she finds the injustice intolerable, transforms into a force for change.  The individual in the end exposes those transgressions, which creates change.  Watkins is the Enron whistleblower.  Effecting social justice seems to require significant sacrifice, which Socrates established.

I write this to show how people can be level 1, Skilling, or Level 3, Watkins, and that the development of an individual into a stage 3 person is a tortuous path, which includes education, resisting social ‘programming,’ early re-purposing of appetite, and lessons in consequences, fairness, and duty.

References

Hobbes, T. (2011). Leviathan. CreateSpace Independent Publishing Platform.

Northouse, P. G. (2016). Leadership: Theory and Practice (7th ed.). Thousand Oaks, CA: Sage Publications, Inc.

Partington, R. (2011, December 1). The Enron cast: Where are they now? Retrieved from Financial News: http://www.efinancialnews.com/story/2011-12-01/enron-ten-years-on-where-they-are-now

SherronWatkins.com. (n.d.). What’s her story? Retrieved from SherronWatkins.com: http://www.sherronwatkins.com/sherronwatkins/Welcome_to_SherronWatkins.com.html

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