Why doing the right thing still requires ethical foresight
Some topics are not easy to write about. Not because we do not know what our views are about them, but because we know how easily the views may be misunderstood—especially by those who prefer a version of pristine ethics and compliance that does not allow for shadows.
I know. Ethics and compliance shadows? That is where you land when you take the liberty—perhaps a little audaciously—of borrowing a concept from one discipline and applying it to another. I have borrowed from psychology and found the result illuminating enough to risk a few furrowed brows.
Carl Jung, the Swiss psychiatrist and founder of analytical psychology, used the term shadow to describe aspects of ourselves that the conscious personality does not recognise, accept or permit. For example, our own anger or fears. The shadow is not simply a storehouse for anger, envy, greed or fear. It may also contain qualities and possibilities that do not fit the story we prefer to tell about who we are.
The concept becomes useful in ethics and compliance because moral certainty can create its own blind spot. When we are convinced that an objective is right, we can become reluctant to examine the harm that its pursuit may set in motion. Acknowledging that harm may feel dangerously close to opposing the ethical objective itself. So we avert our eyes from the casualties, dismiss the cost as unavoidable, or treat anyone who raises it as morally suspect.
But doing the right thing does not relieve us of the responsibility to think systemically about what the right thing may produce. The ethical principle may be sound. The intervention may be necessary, but its design, application, incentives and safeguards may still be inadequate.
Sometimes we become so certain of the rightness of the objective that we fail to examine whether the way we pursue it may create consequences that overwhelm the good we intended to achieve. That is the ethics and compliance shadow: not a bad part of ethics, but the consequence that falls outside our field of attention because it does not fit our conscious story—We are doing the right thing; therefore, what we are doing can only produce good.
Ethics shadows can enter the scene in two ways: through interventions whose unintended consequences have not been anticipated, and through leaders whose unexamined fears become disguised as moral certainty.
The shadow of accountability
One such shadow is visible in the accountability environment shaped by South Africa’s reckoning with state capture.
The Judicial Commission of Inquiry into Allegations of State Capture, commonly known as the Zondo Commission, performed work of profound public importance. It exposed how institutions had been compromised, how governance mechanisms had been bypassed and how public power had been used for private benefit. South Africa needed that truth. It still needs the accountability that should follow from it.
Yet the wider environment that followed has also produced a fear that I encounter with troubling frequency: the fear among public servants and leaders of appearing before a future ‘Zondo 2.0’. I’m not talking about a fear of wrongdoing, but rather a fear that inhibits necessary actions and related risk-taking. The Commission did not create this fear on its own. It emerges from a larger accountability ecosystem: retrospective scrutiny, punitive public discourse, inconsistent consequence management, weak differentiation between misconduct and defensible error, and the personal vulnerability of those whose names become attached to contested decisions.
Add to this a collective mindset that interprets consequence management almost exclusively as punitive. Heads must roll. There must be blood in the streets. Little room remains for corrective action that is constructive, rehabilitative or preservative.
Punitive consequences are necessary when there has been corruption, dishonesty, recklessness or serious misconduct. Ethical foresight does not require us to become soft on wrongdoing. But when punishment becomes the default response even where learning, correction or rehabilitation would be more appropriate, people do not necessarily become more accountable. They often become more afraid. And fear can make doing nothing the safest option on the table.
That is the shadow.
When inaction becomes rational
The fear of negative consequences is especially pronounced in environments under intense scrutiny—regulated industries, politically exposed institutions, and the public sector. These institutions deal with public money and public consequences. Scrutiny is therefore appropriate. Strong accountability is not optional. But accountability systems can produce the opposite of what they intend when they fail to distinguish among negligence, misconduct, poor judgement and a reasonable decision that simply did not turn out well. So, the Auditor-General zeroes in and looks for consequence management, and the automatic default, without application of mind, is punitive.
A leader can act honestly, weigh the available evidence, apply real care and still make a decision that later proves wrong. That is not necessarily an ethical failure. It is part of deciding under uncertainty. Therefore, if every imperfect outcome may be treated retrospectively as proof of wrongdoing, the lesson is unmistakable: avoid decisions that cannot be guaranteed. Those who have earned their leadership stripes know that almost no decision that matters comes with a guarantee.
Under these conditions, the safer move becomes one more round of consultation. Another legal opinion. One more workshop. A referral upward. Bureaucracy. Each step, taken alone, looks like diligence. Stacked together, they can quietly stop the organisation from acting at all.
Here is the asymmetry: the person who makes a defensible call that produces an imperfect result can pay a real, personal price. The person who delays the same decision for two years may pay nothing at all.
Given that arrangement, paralysis is not a mystery. The system has made inaction the rational choice. The cost of that inaction remains real even when nobody’s name is attached to it. Opportunities pass, problems compound, and services inevitably falter. And the same public who is happy to participate in creating a punitive environment cries foul. A related cost is that good people become frustrated and leave, while senior attention is consumed by matters that should have been resolved long ago. Because the cost is dispersed and appears slowly, it rarely lands on one person’s desk. The organisation punishes visible failure while quietly absorbing the much higher cost of invisible delay.
To illustrate further, here is a scenario that is unfortunately familiar in many institutions -collective inertia. The meeting went well. At least, that is how it will be remembered. The discussion was robust. Several people spoke, and a resolution was recorded. Responsibilities were allocated, and everyone agreed that another workshop would help to iron out what remained. Diaries filled up and action items multiplied. And yet, walking out of the room, nothing had actually been decided.
The matter will resurface at another forum. Someone will ask for more input. It may be referred to a committee or sent through one more round of consultation. Months from now, the organisation will still be discussing what it appeared to have resolved today. From the outside, this can look like bureaucracy, poor discipline or weak leadership. Sometimes it is exactly that. But I have sat in enough of these rooms to know that persistent paralysis often has a deeper root: people have learned that making a decision is more dangerous than delaying one. That is not always a competence problem. It may be a perfectly rational response to how the organisation has taught people that risk is allocated.
Leaders can call for agility, initiative and accountability. But if the people in front of them have watched colleagues punished for an imperfect outcome, blamed for a recommendation made in good faith, or exposed the moment a decision attracted scrutiny, the organisation is teaching something else entirely: Do not let your name be the one attached to the decision.
That lesson settles deep. It keeps shaping behaviour long after the leader—or the incident—that planted it has gone. Fear outlives the leader who created it. Leaders often underestimate how long an organisation remembers. A new executive team can arrive with a different philosophy. They tell people they are trusted, that reasonable risk-taking is welcomed and that mistakes are opportunities to learn rather than reasons for careers to end. Those words matter. But words alone do not undo what people have lived through.
If someone was punished for speaking plainly, they will not trust that candor is safe merely because a new value statement celebrates courage. If a manager watched a difficult call end a colleague’s career, an invitation to ‘take ownership’ may sound less like empowerment and more like a warning. Fear does not care whether the current leader is the one who created it. People carry what the organisation taught them, and they watch for evidence that anything has changed.
What happens when an executive admits a mistake? What happens when a well-reasoned decision turns out badly? What happens when a powerful stakeholder is unhappy? The answers reveal more about the health of an organisation than any value statement ever will.
Here is another example that illustrates the same pattern appears in a very different context.
Anti-money-laundering and counter-terrorist-financing controls exist for compelling reasons. Banks should not become conduits for corruption, organised crime or terrorism. Strong scrutiny is ethically justified and socially necessary. But the compliance risk can become asymmetrical. A bank that continues serving a higher-risk customer may face substantial regulatory, financial and reputational consequences if something goes wrong. A bank that terminates the relationship may face far less exposure.
The rational institutional response can therefore become what is known as de-risking: avoiding the customer rather than understanding and managing the risk. The result is that entire categories of customers may be treated as too costly or complicated to monitor. Money-transfer businesses, charities, humanitarian organisations, smaller financial institutions and people in higher-risk countries may lose access to formal banking services. I came too close to tasting the sour experience when I was classified as a PEP (politically exposed person) when I joined the Eskom board. Overnight, I found myself considered by my banks as high risk.
The consequences can be severe. Legitimate aid becomes harder to deliver. Remittances become more expensive or inaccessible. People already at the margins of the financial system are pushed further out.
The shadow becomes darker still when transactions move into cash or informal channels. Financial activity that would have been visible inside a regulated system becomes harder to trace and monitor. The objective was to protect the integrity of the financial system. The shadow may be the exclusion of legitimate actors and the migration of financial activity beyond the system’s line of sight.
This is not merely theoretical. The Financial Action Task Force has formally examined whether the implementation of anti-money-laundering and counter-terrorist-financing standards contributes to de-risking, financial exclusion and the suppression of legitimate non-profit activity. It has since emphasised targeted, proportionate and risk-based implementation. The World Bank has likewise warned that de-risking can obstruct humanitarian assistance and frustrate the original regulatory objective by driving transactions into more opaque channels.
None of this means that controls should be weakened. It means that the rightness of an objective does not guarantee the wisdom of every mechanism used to pursue it. Proportionality, differentiation and foresight are part of ethical implementation—not compromises of it.
When a leader’s shadow is dressed as ethics
The first two examples show the shadow that can be cast by the design of an ethical or compliance intervention. A different—and potentially more dangerous—shadow arises when a leader’s unexamined fears shape what they come to regard as an ethical problem.
Let’s take a scenario of a leader who does not recognise his own shadow and creates an ‘ethical’ scenario that is flawed because of that shadow.
The leader comes to regard a particular person as an organisational liability—not because the individual is unethical or incompetent, but because they persistently surface truths the leader would rather not confront. Instead of confronting the fears that the inconvenient truths create, the leader projects on that individual that they are a liability to the organisation and should be removed. The leader strongly believes that he is taking an ethical stance in protecting the organisation against what he has come to see as destructive.
The leader does not necessarily experience this as persecution. Once the individual has been classified as a threat, confirmation bias begins to organise what the leader notices and how it is interpreted. Ordinary mistakes acquire moral significance. Disagreement becomes disloyalty. Procedural deviations that might have been corrected in someone else become evidence of unfitness. Governance processes then lend institutional legitimacy to a conclusion the leader had already reached emotionally.
The leader feels that they have done the right thing in the interests of the greater good.
However, in addition to the harm that the leader has caused the individual, the leader has not calculated the consequent harm to the organisation. The ripples created by that action include collateral damage to colleagues or subordinates of the individual who have watched what they see as injustice. Relationships are torn apart as the poison spreads. The organisation suffers, as a core competence has just been ripped out, while it is battling to find a replacement. Strategic plans that were in the process of being implemented drift. The negative impact is not only on the individual who left, but is an injury to a corporate citizen whose impact on society may be affected. The combined harm could therefore look like this:
- Individual harm: reputation, career, livelihood and psychological injury.
- Organisational harm: loss of capability, disrupted strategy, fractured relationships and ethical silence.
- Societal harm: weakened delivery by an organisation whose purpose extends beyond itself.
What started as a moral stance born out of unacknowledged shadow becomes the implementation of what is offered as an ethical intervention, which in turn creates harm that ripples through the organisation – and perhaps beyond.
None of this means that people who describe themselves as truth-tellers are always right, or that dissent excuses misconduct. A dissenting voice may be poorly expressed, factually mistaken or used destructively. The ethical test is whether the organisation examines the substance fairly, applies consistent standards and preserves procedural safeguards—not whether the person has made those in power uncomfortable.
Like with the accountability example above, the ripples into the future can be significant. As people watch what happens to someone who is willing to voice inconvenient truths, a silence starts to descend on an organization that may once have embraced openness and treasured dissenting voices that encouraged growth. Once an organisation is cloaked in silence, it becomes very difficult to unmute its people, even long after the leader who allowed his shadow to direct the moral compass has left the organisation.
The probability of this scenario playing out in any organisation increases when the organisation does not have enough counterbalances in place that will question the actions of leaders who target individuals in the name of ethics. If leaders are not held accountable for their actions just because the actions are clothed in ethics, it becomes a collective leadership failure of the organisation.
Why good intentions narrow the field of vision
The three examples look very different. One concerns accountability after state capture; the other, the integrity of the global financial system; and the last one, the shadow of a leader projected as ethical action. But their underlying structure is similar. In all three, the good being protected is real. In all three, the consequences of visible failure are severe. In all three, actors learn that avoiding exposure may be safer than exercising judgement. And in all three, the protective mechanism can begin to undermine the good it was created to serve.
This is why intention is an inadequate measure of ethical leadership. Good intentions tell us what we hoped to achieve. They do not tell us what our intervention actually caused, whom it burdened, which incentives it created, or how people adapted to it.
Moral conviction can also make dissent harder. Once an intervention is associated with fighting corruption, protecting vulnerable people or defending institutional integrity, anyone who questions its design risks being heard as opposing the cause. The more morally important the objective, the more deliberately leaders must protect the space in which its possible shadow can be named. Otherwise, the organisation becomes ethically certain and operationally blind.
Governing the shadow
Ethical maturity requires more than the courage to pursue what is right. It requires the humility to ask what our pursuit may set in motion.
Before introducing an ethics or compliance intervention, leaders and governing bodies should ask:
- What good are we trying to protect?
- What behaviour will this intervention reward, discourage or drive underground?
- Where does it make risk asymmetrical—and what will a rational person do in response?
- Who may carry costs that are invisible to the decision-makers?
- How will we distinguish deliberate misconduct, negligence, poor judgement and a defensible decision that produced an adverse outcome?
- What early evidence would tell us that the shadow is beginning to overwhelm the intended good?
- What safeguards, feedback loops and review points will allow us to correct course without abandoning the ethical objective?
These questions are not an invitation to moral relativism. They do not suggest that every ethical standard should be weakened whenever it becomes inconvenient.
They are an invitation to ethical foresight.
A system that fights corruption but makes responsible decision-making personally irrational needs better design. A compliance regime that protects financial integrity but excludes legitimate actors and pushes activity into opacity needs more proportionate implementation. Leaders who take moral stances without examining their own shadow in the process need appropriate counterbalances.
Doing the right thing can carry a cost. Sometimes that cost is unavoidable and must be borne. But when foreseeable harm can be reduced without betraying the principle, failing to anticipate and mitigate it is not ethical resolve. It is moral tunnel vision. We should therefore be as willing to examine the shadow cast by our ethical interventions as we are to proclaim the light they were intended to bring. Ethical maturity is not demonstrated only by our willingness to do what is right. It is also demonstrated by our willingness to look honestly at what doing it may set in motion—and to take responsibility for governing those consequences.
If you are exploring these questions in your own leadership journey, you are welcome to connect or learn more about my work here: Board Services and Executive Support
