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Ethics and morality of leadership have
been important for organizations due to the positive impact it is creating an environment in making the right decisions and developing a strong management team. An ethical leader needs to have the characteristics of honesty, respect, integrity, empathy, responsibility, accountability and can distinguish right from wrong in decision making. "Business leaders want to establish a practice of positive workplace ethics within their organizations and this is adding a new moral dimension to leadership" (Raghupathy, 2011).
It is no surprise that organizations have conducted unethical acts, faced scandals and other forms of misconduct which drew the government's attention. In these cases, the government held the organization's liability for their wrongdoing. Over time companies have watched as other companies deal with unethical decisions by facing lawsuits, a decrease in sales, financial loss and losing the trust of their customers. This type of behavior led to changes within organizations by developing an ethical policy, creating a culture that focused on personal and organizational values, as well as encouraging leaders to be role models.
"Obeying the law and adhering to regulations are the easy part of the leader's job in assuring good behavior on the part of employees, managers and executives" (Guest Editorial, 2009). Organizations are now more selected when hiring employees that share similar values, provide on the job training and encourage employees to make the right choices. Leaders that provide open communication, assign goals, provide feedback to employees will develop an ethical environment where employees will be respectful, productive, increase their performance levels and will take accountability for their actions. The main point for a leader is to understand ethical and moral behavior which will set an example for their employees. Leaders need to act professionally with integrity which will influence their employees to inspire attitudes, behaviors, values, and activities. When leaders act in a personal and professional manner this will influence their employees to do the same that will benefit them as well as the organization