This white paper defines ethical leadership with a specific focus on the nonprofit community and discusses why it is so critical for nonprofit organizations to embrace the concept.

It takes into account the fact that nonprofits occupy a special role in our communities and are respected as the stewards of society. Unlike their corporate counterparts, it is most often assumed that nonprofits (by virtue of their designation!) are ‘above’ greed. This reputation for being sincerely committed to doing good speaks volumes about the ability of nonprofits to tell their story and achieve their mission based on having gained universal trust in their intent.

This paper explores the concept that an ethical culture is fundamental and, in fact, essential to the sustainability of the nonprofit community. 

1. Define Ethical Behavior

According to Wikipedia, ethical leadership is, “the type of leadership that is directed by respect for ethical beliefs and values, and for the dignity and rights of others.”

Dr. Walter Earl Fluker, the Martin L. King, Jr. professor of Ethical Leadership at the Boston University of Theology and the Graduate Division of Religious Studies, defines this by saying, “Ethical leadership is the critical appropriation and embodiment of traditions that have shaped the character and meanings of a people. Ethical leaders, therefore, are those leaders whose characters have been shaped by the wisdom, habits and practices of particular traditions, often more than one, yet they tend to be identified with a particular cultural ethos and narrative. Finally, ethical leadership asks the question of values in reference to ultimate concern.”

Based on these definitions, nonprofit leaders who demonstrate an ethical approach are recognized as trustworthy, honest and fair. They are seen as the leaders who support a code of conduct. That is, they enforce the civility, morals and values that are the basic building blocks of our society. 

Leaders who exhibit ideals and principles, who hold fast to a strong code of behavior, help the nonprofit community through their actions and through their dedication to maintaining high standards for their organizations.

Historical perceptions of ethics in the nonprofit community

It has always been essential for nonprofit leaders to do the right thing.  With the world watching, nonprofits have been elevated to high stature, proud to stand for decency, for the protection of the world’s most vulnerable citizens, and for putting the needs of others ahead of the need for personal gain. In short, nonprofit leaders have always been expected to promote and represent the ethical behavior that is so integral to the sector.

That is why any breach of trust is so alarming.

Thomas H. Jeavons writes for Safari Books Online, “Since the mid-1980s, scandals in the nonprofit sector and the corporate world have given rise to heightened concerns about ethics, accountability, and public trust for all types of organizations. Charitable organizations and those who run them have behaved badly on occasion before, but they have probably never received such intense public scrutiny as over the last quarter-century.”

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