Navigating Ethical Waters: The Dilemma of EXECUTIVE Power and Workplace Relationships

If there is one issue that dominates discussion in the world of corporate governance and ethical leadership, it’s the question of how executive duty and personal relationships interact. Power, ethics and temptation, front and centre, it’s a rich topic where professionalism and personal desire clash – and where, as the recent reports on the conduct of the US executive Elon Musk remind us, the challenges are considerable.

The EXECUTIVE's Dual Role: Steward and Individual

On one level, the executive in a corporate context could be said to be purely ‘transactional’, concerned with all matters that impact on a company’s profit, growth, and shareholder value. Yet, despite this seemingly clear dichotomy, a closer examination reveals that the executive also holds power over the careers of his/her subordinates. For this reason, the notion that executives can both promote the wellbeing of a corporation and effectively fend off the ordinary temptations of human frailty, all at the same time, reveals the inevitable cauldron of conflict at the heart of this debate.

Ethical Leadership in the Spotlight

So it never seems productive to talk about executive ethics without also talking about what EXECUTIVE behaviour risks doing to their company’s culture and to the people who work there. When Elon Musk and others have pursued romantic relationships with those who work for them, questions of consent, power imbalance, favouritism and other issues can follow. Workplace relationships can have many fans. These can be American Idol-style crushes that make people very happy and productive. They can also be whirlwind romances that lead to marriage or divorce. Or, of course, they can be vastly more problematic. They can, as in the case involving Musk, put the boss on the defensive in allegations of misconduct that are both highly visible and potentially very damaging to the company.

The Impact on Company Culture

The way an executive like Musk conducts themselves can create a culture where there is room for the organisation’s culture to be dissonant with acceptable behaviour: when senior leaders are rumoured to have affairs with employees, or are said to show favouritism towards certain people, it can also lead to feelings of distrust, erode morale and create a culture where employees may feel that their success is tied in some way to their relationships with leadership, rather than their merit or ability to get their job done well.

Safeguarding Against Power Imbalances

The core problem has always been the power differential between the executive and the employee lower down the organisation, which can colour judgment, influence the outcome of decisions, and be exploited in a situation in which someone feels coerced into a relationship or may do something that they otherwise wouldn’t have done. Having clear policies, a culture that encourages transparency and reporting, and having safe, confidential reporting channels are critical.

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