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Leading with Integrity: The CEO's Blueprint for Sustainable Success

Leading with Integrity

Leading with Integrity: The CEO’s Blueprint for Sustainable Success

We often measure a CEO’s leadership performance in dollars and cents. But once upon a time, firms like Enron and WorldCom were very profitable until they were felled by leaders who lacked integrity. Unless CEOs carry out their duties with integrity, a dazzling earnings report or IPO will be a short-term accomplishment. Even if a CEO doesn’t break any laws, bad behavior will eventually poison culture and turn employees and customers against a company.

CEOs who lead with integrity consistently check these nine boxes to keep Making BIG Happen the right way and for the right reasons.

1. Exhibiting Ethical Leadership

The CEO should set the moral compass that guides decisions, behaviors, and culture for the company. Both public and in-house communications should be clear, and those words should be backed up with ethical actions. Establishing that congruence between what you say as a CEO and what you do sets high standards that every other level of the organization will aspire to reach. It also informs a powerful brand identity that makes customers feel good about supporting you.

2. Cultivating Trust

Talking the talk and walking the walk also builds trust between the CEO and employees, customers, investors, and prospective talent. Consistently demonstrating honesty, fairness, and transparency makes people feel supported and cared for. That’s a foundation that creates long-term relationships, as well as reduced turnover and churn.

It could take just one minute of wayward trust to destroy what took years to build. Value, protect, and cultivate the goodwill you and your key stakeholders share. If you lose it, you might not get it back.

3. Driving Company Culture

A CEO who demonstrates integrity inspires a culture of accountability, openness, and ethical behavior throughout the organization. Employees who feel both motivated and supported will be more willing to take chances on outside-the-box ideas that might lead to significant innovations. They’ll also look to the CEO’s example when making on-the-ground decisions with co-workers and customers, doing what’s right rather than what’s easiest or convenient.

4. Managing Risk Responsibly

The CEO’s integrity helps maintain best practices that keep the company operational. Compliance, safety standards, accounting, and reporting of the highest caliber will put the company in the best possible position to respond to crises, take advantage of opportunities, and fulfill its commitments to key stakeholders. Without integrity, corners might get cut and the company could expose itself to legal and financial risks that it could have easily avoided. When those kinds of problems start to stack up, CEOs are risking more than fines: they’re risking the company’s very reputation and its ability to keep doing business.

5. Being Mindful of Long-Term Success and Legacy

In the heat of a boardroom battle or a high-stakes negotiation with an acquisition target, CEOs often feel like they ARE their companies. That can lead to short-sighted decisions that sacrifice long-term success for today’s personal glory.

Acting with integrity has a way of drawing us outside of ourselves so that we can take in a picture that’s much BIGGER than any one CEO. As tempting as it might be to slap together a profitable exit when the company’s valuation is at an all-time high, an ethical CEO might start exploring ways to shore up succession planning so that the company will outlive her and continue to generate value for employees, shareholders, and customers. A business that’s infused with that kind of legacy could keep growing and succeeding for generations.

6. Accepting Accountability for Tough Decisions

Business is not always fair, and CEOs have to make countless decisions that have both positive and negative consequences. Terminating a new product that hasn’t appealed to customers might help the company refocus its sales around more profitable offerings, delighting shareholders. And, at the same time, that decision might trigger layoffs.

Integrity can help CEOs ground tough choices in the greater good, rather than what’s going to make them look good. When the news is positive, the CEO should celebrate contributions from every level of the organization. And when the news is hard, the CEO should exercise transparency and high-EQ leadership to explain their thinking, accept responsibility for the company’s missteps, and help employees cope with the fallout.

7. Inspiring Confidence

CEOs need to convince a variety of stakeholders that their interests are being looked after — even when those interests are in conflict with each other. Investors, shareholders, and financial institutions want to see strong profits and plans for more growth. Boards and family ownership groups want to see progress towards key objectives. Employees want job security, fulfillment, and room for advancement. C-suite colleagues want to feel like they have a role in the company’s strategic direction. And customers want to feel like the money they spend makes them part of a community that’s BIGGER than pure profit.

Rarely will all of these stakeholders agree with every decision you make as CEO. But if you operate with integrity, stakeholders will always respect your decisions and keep trusting your leadership going forward.

8. Adapting to and Managing Crises

It’s easy to lead with integrity when the going is good. The true test of a CEO’s mettle comes when profits are down, customers are angry, and employees are heading for the exits.

One of a CEO’s most valuable resources during a crisis are the reserves of trust they’ve built up over the years. When people are scared or frustrated, they need to believe in both the person holding the megaphone and the message they’re broadcasting. If you’ve made ethically sound decisions in the past, people are going to buy into your crisis management quicker and pivot to problem-solving. And if you’re clear about the reality of a tough situation and what needs to happen next, you’ll also top off those trust reserves for next time.

9. Learning from Other CEOs’ Mistakes

CEOs often draw learnings and inspiration from giants in business, sports, and politics who lead their teams to BIG “the right way.” But CEOs should also learn from leaders whose lack of integrity had disastrous consequences for themselves and their companies.

For example, Elizabeth Holmes appeared to be a picture-perfect 21st-century CEO. She smashed the glass ceiling and dazzled investors by building her own Silicon Valley startup. She had a bold vision for a revolutionary new nexus of tech and health care. She dressed like Steve Jobs and was going to “move fast and break things” like Mark Zuckerberg.

But as she tried to live up to the picture on all those magazine covers, Holmes made numerous false claims about her company’s blood testing tech. Exposure of these falsehoods evaporated Theranos’ $9 billion valuation and landed Holmes in jail.

Martin Shkreli tried to embody another tired CEO archetype: the ruthless leader who drives up profits, no matter what. As CEO of Turning Pharmaceuticals, Shkreli gained notoriety for buying Daraprim, a standard, life-saving treatment for parasitic infections, and jacking up the price overnight from $13.50 to $750 per pill.

Legal? Yes. Ethical? Hardly.

Public outrage, media scrutiny, and interest from the government snowballed. Eventually, Shkreli was convicted of securities fraud, which, ironically, was unrelated to the bad decisions that raised his profile in the first place.

And that might be the ultimate lesson from unethical leadership: one poor choice usually leads to another, and another. Cultivating and demonstrating integrity won’t insulate CEOs from every misstep. But, in the long run, you’ll make more good moves than bad and stay true to the vision and values that will lead your company to BIG.

About CEO Coaching International

CEO Coaching International works with CEOs and their leadership teams to achieve extraordinary results quarter after quarter, year after year. Known globally for its success in coaching growth-focused entrepreneurs to meaningful exits, CEO Coaching International has coached more than 1,000 CEOs and entrepreneurs in more than 60 countries and 45 industries. The coaches at CEO Coaching International are former CEOs, presidents, or executives who have made BIG happen. The firm’s coaches have led double-digit sales and profit growth in businesses ranging in size from startups to over $10 billion, and many are founders that have led their companies through successful eight, nine, and ten-figure exits. Companies working with CEO Coaching International for two years or more have experienced an average EBITDA CAGR of 53.5% during their time as a client, more than three times the U.S. average, and a revenue CAGR of 26.2%, nearly twice the U.S. average.

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