Why is Integrity Important in Leadership?

Leadership

May 5

Some of the common leadership qualities that a leader must have include good communication, strong decision-making and interpersonal skills, adaptability, self-awareness, accountability, and so on.

However, within this list, integrity often gets less attention from the rest. Integrity drives value-based leadership and helps set apart honest leaders at the top of their leadership game.

According to an article, only 21% of leaders are capable of making improvements and becoming honest and truthful. That is because they fail to understand what integrity may help them achieve. Read this discourse to find more details on this so you can work on becoming a truthful guide for your team.

Why Does Integrity in Leadership Matter?

Simply put, integrity in leadership is a strong commitment to transparency and ethical principles. It drives effective leadership through various benefits.

For instance, trust is considered a foundation of successful leadership. So, when a leader practices honesty with their subordinates, they foster an environment of mutual respect and safety. According to a Harvard Business Review Report, organizations with executives rated highly for their integrity, experience a 40% increase in their employee retention and a 25% increase in profitability.

Integrity also fosters a strong culture of accountability. When integrity-driven leaders hold themselves accountable, they create a culture where taking responsibility becomes a norm. This helps in generating better decisions that are based not just on short-term gains but long-term fairness.

In addition, a leader’s integrity helps motivate and inspire teams. Since employees mirror the behavior of their leaders, an honest attitude of the latter helps set a tone that encourages ethical behavior and pride in the workplace.

Google’s motto, Don't be Evil, is not official now. However, it helped shape a strong culture of ethical innovation. It also played a role in empowering employees in the early days of the company.

However, integrity in leadership is not only defined as being honest about decisions. It is a demonstration of ethical behavior in daily actions. It also means to communicate certain non-negotiable principles, such as sustainability and inclusivity.

Integrity in leadership is also a practice that recognizes and celebrates employees who have organizational values. It involves providing regular training to workers so they understand the importance of integrity and ethical decision-making and can take action as required.

Challenges in Incorporating Integrity in Leadership

As per the EY Global Integrity Report 2024, US corporate fraud destroys roughly 1.6% of a company’s equity value annually. This implies that integrity in leadership can lead to significant financial and reputational risks. This is why it is more than important to practice this ethical value in your leadership style.

However, it isn’t as easy as it may sound. Leaders often face pressure from political bodies and stakeholders that may push them to compromise their integrity. Leaders might have to act dishonestly to meet short-term goals or satisfy external/unnecessary demands of people working in the upper levels of their company’s hierarchy.

Besides, at times, there is sheer ambiguity in ethical standards. Some leaders are unaware of policies due to a lack of understanding, which makes it difficult for them to uphold integrity. Similarly, certain organizations do not value honesty. The lack of a company’s ethical culture also becomes a huge challenge between a leader’s honest approach and the organization’s goals.

Not everyone can stand up for integrity. For some leaders, this task leads to backlash, support loss, and even job insecurity. Leaders who may be the only breadwinners of their household may fear losing their jobs for not conforming to the unethical norms of their organization.

How to Become an Honest Leader?

It is not easy becoming a leader, let alone an honest one. Integrity in leadership is more than just telling the truth. It is about being consistent in your actions, being accountable, and considering ethical values when making decisions.

Here is how you can become an honest leader.

Lead By Example

To practice integrity, do what you preach. You will have to be ethical even if no one watches you. One of the popular leaders, Satya Nadella’s leadership style is defined as transparent, honest, and open-minded. This leadership approach helped the CEO of Microsoft transform the company’s culture, increase its value, and prove that ethical leaders can generate profits as well.

Practice Transparent Communication

A leader that practices honest communication builds trust. It is the duty of good leaders to avoid withholding data or making false statements. According to a Harvard Business Review study, organizations led by transparent communication have 30% more employee engagement than companies that are not. This clearly emphasizes the importance of encouraging a culture of integrity in a company.

Admit Your Mistakes and Be Accountable

To become a fair and honest leader, make sure to be open about your mistakes. You must be able to take steps to mitigate them and hold yourself responsible wherever it is possible.

Here is an example. Howard Schultz, who once led Starbucks, shut down 8,000 stores for a day in response to racial bias training for employees. He made this decision after receiving public criticism and calls for boycotts after two Black men in a Philadelphia store were arrested. Schultz apologized to the public and also outlined the plans to prevent this issue from happening again.

Create a Strong Culture Promoting Honesty

Do you know that organizations with a culture of safety experience a 12% improvement in their employee performance compared to those who don’t? To build a company with employees who have every right to speak their hearts out, a leader needs to be honest and promote a culture of integrity. A strong, honest culture also reinforces fairness at all levels of the organization.

Final Takeaway

It is safe to say that integrity as the foundation of true leadership can change the way you run an organization. It helps enhance employee engagement, build trust among various team members, and eventually drive profitability for the company.

However, becoming an honest leader is a long process. It involves a continuous process of self-awareness, ethical decision-making, and lots of courage. An honest leader often faces multiple challenges in their path. However, if they stay committed to their values, building an ethical culture always works out in the end.

Sources:

Sheri Jacobs https://sherijacobs.com