Donald Trump’s business ethics could be contagious

Donald Trump’s impact on business could extend into ethics, writes Donald Sheppard.
Donald Trump’s impact on business could extend into ethics, writes Donald Sheppard.
Image: AP Photo/Susan Walsh
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Until 1960, nearly every adult male in America wore a hat. To men of almost every rank, a proper hat was as important to a wardrobe as shoes. Men wouldn’t think of leaving home without a hat. Laborers and blue-collar workers wore cloth caps. Businessmen chose a fedora when sporting a suit and tie. For formal occasions, such as the inauguration of a new American president, top hats were the style (stovepipe-looking accessories whose only practical function appeared to be to serve as targets for schoolchildren armed with snowballs).

But after 1961, hats became as rare on the heads of American men as lampshades. The reason? John F. Kennedy was elected president the previous year. Kennedy disliked wearing hats and dispensed with them. Soon, so did most American men.

I think about this story sometimes when I wonder what the impact of Donald Trump’s presidency will have on American business ethics.

Research over several years has revealed that companies rated highly for their ethical standards outperform the average for the U.S. Large Cap Index by as much as 6.6 percent. But Donald Trump appears to reject any notion of “doing the right thing” if it fails to enhance either his earnings or his ego.

From declaring multiple bankruptcies while ignoring their impact on partners, employees, suppliers and shareholders; to concealing his income tax returns and walking away from failed and apparently fraudulent business ventures such as Trump University, Trump Airlines, Trump Mortgage and Trump Steaks, the man’s actions have been weighed only according to whatever benefit they afforded him personally. Let’s be clear: On their own, business failures do not indicate an absence of ethics. But the circumstances surrounding so many of Trump’s failed companies—such as his overhyped Trump University, for which he paid $25 million to settle claims from disgruntled fraud victims—suggest that the only thing guiding Trump in the venture was another way to maximize his profits with minimal concern for others.

Business ethics are not hats, I agree. (And, if I need point out, Donald Trump is no JFK.) But the effect holds true. As I write this, America has a leader whose values are almost entirely at odds with those of the majority of U.S. citizens. Yet he occupies a position that represents a model of behavior for all of us. The high profile of his presidency serves as a paradigm, a guideline we feel obligated to accept and perhaps follow.

Few men in the early 1960s thought to themselves, “Gee, Kennedy doesn’t wear a hat, so I guess I won’t either.” Their minds began shifting away from tradition toward an unaware mimicking of the much-admired young president’s behavior. They were influenced by Kennedy’s fashion sense even when it conflicted with their customary behavior, because “what is good enough for the president…” We don’t, in other words, always consciously choose to follow an influential person’s behavior. We are naturally and sometimes unwittingly drawn into the orbit of a charismatic leader, and we fall into step while following along. It’s not heel-clicking blind obedience. It’s a matter of assuming that, in this case, the leader of a country that has signified freedom to much of the rest of the world for more than two centuries represents a standard of behavior for citizens everywhere—especially those who call themselves Americans.

We choose our leaders partly because we believe their goals and values are aligned with our own. Or at least we used to. Today, even if no one or only few are choosing to act like Trump, America’s standard of ethical behavior risks slipping because of his influence.

This opinion article has been adapted from the book The Dividends of Decency: How Values-Based Leadership Will Help Business Flourish in Trump’s America.