Just What Are the Priorities?

In March 2024, Boeing’s CEO David Calhoun announced his resignation amid a deepening crisis following a near-catastrophic mid-air incident involving a door panel blowing off a 737 Max jet. The scandal reignited questions about safety culture, board oversight and the ethical backbone of corporate decision-making. What would have happened if ethical leadership—not cost- or corner-cutting—had been the priority?

This article argues that ethical leadership is no longer a corporate virtue signal—it’s the cornerstone of sustainable, effective governance. We’ll explore why ethics matter more than ever in a world driven by transparency, what happens when leaders abandon their moral compass, and spotlight emerging, innovative models of ethical leadership that are reshaping boardrooms from London to Silicon Valley. Ethics, as you’ll see, are big business.

Ethics Are the New Business Strategy

Ethical leadership is no longer a matter of corporate conscience—it’s a business imperative. In today’s hyper-transparent world, trust is currency, and companies that fail to demonstrate values-driven leadership are fast losing favour with investors, employees and customers alike. According to the 2024 Edelman Trust Barometer, 63% of global respondents say they buy or advocate for brands based on their beliefs and values, while 69% expect CEOs to be the face of change on societal issues—not just profits.

Gen Z, now a growing force in the workforce, are vocal in demanding ethical workplaces, calling out “greenwashing” and performative Corporate Social Responsibility (CSR). At the same time, activist investors and AI ethics watchdogs are holding companies to higher standards, particularly around data use, sustainability and social impact.

In this environment, ethics are emerging as predictive indicators in governance and ESG scoring systems such as those from MSCI and Sustainalytics. Companies with higher ethical governance scores enjoy stronger reputations, fewer regulatory clashes and higher long-term returns. Simply put, ethical leadership isn’t just the right thing to do—it’s a smarter way to do business. The firms that integrate ethics at the strategic level aren’t just surviving; they’re setting the pace for the future.

The Cost of Getting It Wrong

When ethical leadership is absent, the consequences are not just moral—they’re financial, legal and reputational. Consider the collapse of FTX, once hailed as the future of cryptocurrency. Its founder, Sam Bankman-Fried, was convicted of fraud in 2023, after it was revealed that billions in customer funds had been misused. The scandal wiped out an estimated $8 billion in investor value and shattered trust in the broader crypto industry.

Volkswagen’s 2015 emissions scandal—where software was used to cheat emissions tests—has cost the company over €30 billion in fines, buybacks and legal fees, not to mention years of reputational damage that continue to affect brand loyalty.  Then there’s McKinsey & Company’s involvement in the US opioid crisis, where the consultancy advised pharmaceutical firms on how to “turbocharge” opioid sales—ultimately agreeing to a $573 million settlement in 2021

In each case, weak ethical oversight wasn’t an unfortunate lapse—it was a failure of governance at the highest levels. Boards can no longer afford to turn a blind eye. In the eyes of regulators, investors and the public, ethical blind spots are governance failures—and costly ones at that.

Case Studies in Ethical Leadership

Ethical leadership profoundly influences corporate culture and public perception. The following cases underscore the tangible impact of ethical leadership on corporate integrity and societal trust.

Satya Nadella, CEO of Microsoft, has championed an empathy-driven approach, fostering inclusive design and prioritising ethical AI development. Under his guidance, Microsoft has integrated accessibility features into its products, ensuring technology serves all users equitably. Nadella asserts, “Empathy must be embedded in artificial intelligence from the moment it is created to ensure it becomes a positive force in people’s lives.” ​

Rose Marcario, former CEO of Patagonia, intertwined environmental activism with business strategy. She led initiatives such as donating $10 million from tax cuts to environmental causes, stating, “Our home planet needs it more than we do.” Marcario also emphasised the importance of businesses taking a stand, remarking, “This idea that business can only serve one interest—the shareholder interest—is so wrong-headed. It’s outdated.” ​

Yvon Chouinard, Patagonia’s founder, further exemplified ethical capitalism by transferring ownership of the company to a trust dedicated to combating climate change. This bold move ensures that all future profits, approximately $100 million annually, support environmental initiatives. ​

In contrast, Sam Bankman-Fried, former CEO of FTX, promoted “effective altruism” while engaging in unethical practices leading to one of the largest financial frauds in history. His actions serve as a cautionary tale of virtue signalling masking unethical conduct. ​

New Thinking in Ethical Leadership

In response to evolving societal expectations and complex challenges, businesses are redefining ethical leadership through innovative frameworks. The appointment of Chief Ethics Officers and the formation of cross-functional ethics committees exemplify this shift, ensuring that ethical considerations are integral to strategic decision-making. For instance, IBM established an AI Ethics Board in 2018 to oversee the responsible development and deployment of AI technologies.

In the realm of technology, companies like Google and Salesforce are embedding ethical reviews into product development to address concerns such as bias and transparency. Salesforce’s Ethical AI team has released guidelines to promote responsible AI practices.​

Emerging models further illustrate this commitment to ethics. Ethics-as-a-Service startups offer platforms to help businesses navigate ethical dilemmas in AI implementation. The B Corporation movement champions stakeholder governance over traditional shareholder primacy, embedding social and environmental objectives into corporate charters. Additionally, some boards are adopting “red teaming” strategies, wherein independent groups critically assess decisions to unearth potential ethical pitfalls.​

These developments underscore a move towards agile ethical leadership, characterised by adaptability, active listening and continuous learning to navigate the complexities of modern business responsibly.

The Future Is Ethical—or It Isn’t Future-Proof

The case for ethical leadership has never been clearer—or more urgent. What was once dismissed as a soft skill is now a hard requirement in boardrooms across the globe. In a volatile business landscape shaped by AI disruption, climate accountability and social activism, the leaders who will thrive aren’t just sharp strategists—they’re principled visionaries.

Ethics, far from being a corporate tick-box exercise, have become a strategic edge. Companies that prioritise transparency, inclusivity, and long-term thinking consistently outperform their peers in brand loyalty, investor confidence and talent retention. Ethical leadership isn’t just about avoiding scandal—it’s about unlocking innovation and resilience in a world that demands both.

So, as we look ahead, the challenge for business leaders and investors is this: in a world driven by transparency and trust, who would you rather bet on—a clever strategist, or a principled visionary? It’s time to move beyond charismatic CEOs and flashy quarterly wins. The future of governance lies in ethical agility, stakeholder stewardship and leadership with integrity. The companies that embrace this will not only survive—they’ll lead. And those that don’t? They may find the future far less forgiving.