Ethical Insights: The need for ethical leadership often comes to the fore in the boardroom

In this series of conversations about ethical leadership, we speak with high profile ICAS members who have reflected on what it means to do the right, or ethical thing throughout their careers. It is hoped that the conversations provide practical guidance to help anyone in a challenging professional situation where they are required to seek the truth and then act.

As well as interviewing these ICAS members individually, under Chatham House rules, we also surveyed our members in a quantitative survey during 2024, conducted by Dodds & Law Research Associates. We received 710 responses from a survey of 10,000 members and we have taken some of the results and findings and used them in this report to highlight the wider views of members.

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Insight seven

In this instalment, we highlight the need for ethical leadership in the boardroom, to have the courage of your convictions, to challenge, and to ask the questions that no one else is prepared to ask to ensure you fully understand the issue.

Boards can often present a particular type of ethical challenge as well as a space in which resolution can be achieved provided you have the courage and tenacity to ask the right questions and know when to push back: 

“One of the great things about our profession is you get into the boardrooms of the biggest companies in the country and see them in action. I remember taking a young apprentice to a meeting when I was technical partner at one of the larger accountancy firms. It was one of our major clients and we'd had a terrible audit, absolutely awful. There had been a number of heated debates around what the company could declare as profit that year, which eventually got within an acceptable envelope.  

“Anyway, we went into the meeting and the Chairman asked me where I felt the company's accounting policies stood between highly acceptable and totally unacceptable to which I responded, ‘just about acceptable’. I was asked to explain my reasoning and we were then asked to leave. Before the door was shut behind us the shouting began and a senior non-exec said to the CEO either the CFO gets fired or we go, and if we go, you'll have to go, and so the CFO was fired. The next year's audit was a lot easier.” 

Complacency in a boardroom may not be the same thing as duplicity, but it can be equally damaging and needs to be challenged: 

“I've always liked to be the one in the corner who asks, ‘what is this?’ So often around a board table there is splendid alignment – someone will say ‘right, we are all agreed’ and then the conversation will go onto what is happening at the weekend. Sometimes you just need someone around the table who is going to be a pain in the neck - who is going to constantly challenge things on the basis that ‘I didn't actually understand that, can you just run it past me again’ even if others around the table quietly despair.”

Being prepared to ask the deceptively simple questions that no one else is prepared to ask – even if these can risk making you look stupid is key:

“I remember being appointed to Chair the board of a large museum where I was told they had just brought a Benin Bronze. I asked whether this was the name of the sculptor only to be told by a learned Board member that it was in fact a Kingdom, now a province in Nigeria. However, in fact the majority of the board members who had welcomed the purchase confessed that they were also unaware that Benin was a Kingdom. My point is that I don’t mind looking daft at times if that enables me to ask the kinds of questions that will get clarity around an issue.”

Finally, as one NED put it, have the courage of your convictions: 

“When giving challenge it is important to be strong, be yourself. I mean, how would you feel if someone was fiddling you? This might be someone else’s business, but you would not want your pocket pinched - so you have a responsibility to say, ‘I don't actually understand that number’.” 

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