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What Does It Mean to Be a Responsible Business Leader?

April 27, 2018
ethical leadership traits

At times, it can be easy to think of profits as the only thing that matter in business. But any leader worth his or her salt knows that profits only get you so far unless you integrate ethics and integrity into your practices. You may sell a lot of widgets, but at the end of the day, you must do right by your customers, your industry and your community, or else the profits you enjoy today could be gone tomorrow.

Here are some of the ways that leaders keep responsible business at the forefront of their practice:

  • Using honest dealings with partner and clients
  • Empathetic treatment of employees
  • Promoting a culture of diversity and respect throughout a workplace
  • Giving back to communities through charitable efforts
  • Making business decisions that take into account the environment and future generations
  • Integrating responsibility throughout a mission statement

Ethical leadership not only fosters a workplace culture that benefits employees, it’s also important for the bottom line. Responsible business can lead to increased brand loyalty, more customer satisfaction and improved employee engagement, and numerous studies have confirmed a link between profits and responsible business.1

At California State University, Monterey Bay, the Online MBA program focuses on shaping future responsible business leaders by teaching ethical leadership traits. Here's a look at five notable arenas in which ethical business practices are changing the game.


One of the greatest challenges facing businesses in the 21st century is sustainability, and this challenge is even more acute for the auto industry. Some automakers, especially producers of electric cars, have begun to envision a more sustainable future. The electric car company Tesla, propelled by the vision of its forward-thinking founder Elon Musk, has even ceased legal defense of their intellectual property, so that other automotive companies can harness the renewable power of sustainable transportation.2

By helping make electric vehicles more plentiful and thus more affordable, the environmental impact of the auto industry can be lessened. This business model serves to help sustain the planet, decrease health problems caused by vehicular pollution and make the world brighter for future generations.

Artificial Intelligence—With Heart

The growth of artificial intelligence (AI) in the tech industry has produced a host of ethical leadership concerns that will need to be addressed in the coming years. Will robots take over the workforce? How will AI affect people's privacy? And how will the wealth generated by machines be distributed?

Leaders in the tech industry are embracing responsible business with AI by creating foundational ethical principles for AI technologies. Some of the core ethical values that have been discussed by these leaders include:3

  • Purpose: AI systems should revolve around augmenting, not replacing, human intelligence
  • Transparency: Companies should disclose the AI developments they make, the ways in which AI technologies gather data and how that data is used
  • Skills: AI platforms must be built by engineers in conjunction with the skilled humans for whom their use is designed

What is most important as tech companies develop AI is that skilled humans remain at the center of the process. Major tech companies have even formed an organization called the Partnership on AI to establish an open discussion about new AI developments and practices.4

Righting Past Wrongs

ethical leaders

Sometimes, corporations will stumble and make choices that fail their customers, stakeholders or the public. When this happens, they have a choice: try to cover up or minimize their failings, or be transparent and accept accountability. In recent years, several major auto companies have experienced massive public relations crises related to deceptive emissions testing software and faulty ignition switches linked to fatalities.6

Instead of trying to “move past” such scandals, leaders should strive to make them a constant reminder of what can happen when things go wrong and to improve their own company’s culture. At least one of the automakers embroiled in these scandals hired a compensation expert to determine how much compensation victims of their faulty vehicles were entitled to, and wisely did not contest any recommendations.

In the wake of such scandals, ethical leaders must work to strengthen their companies’ adherence to core values and foster greater accountability.7 By facilitating better ways for team members to work together, ethical leaders can ensure that their companies continue to innovate and protect customers.

Inclusive Tech

Empathy is a major driver of innovation.8 Without a deep understanding of customers’ needs, fears and desires, a company will not be able to create products that truly serve the public. Increasingly, companies are developing services and products that enable people with disabilities to participate fully in the advancements of modern society.

Compliance with the Americans With Disabilities Act (ADA) has been a must in American workplaces since 1990, but only in the last decade has it also become a significant part of the development of consumer products or services.

We can see a focus on empathy and accommodating people with disabilities in a rage of new tech products. Some new computer operating systems have an eye-gaze capability that enables people with compromised manual mobility such as those with Lou Gehrig’s disease to type with their eyes.9 There are also a variety of apps that use a phone's camera to recognize objects and describe them for visually impaired users.10 These are just a few developments for individuals with disabilities.

Learn How to Be a Responsible Business Leader at CSUMB

If you aspire to be a responsible business leader yourself, the Online MBA program at California State University, Monterey Bay can teach you the skills you need to bring ethical leadership to any organization.