If the CEO and other top leaders of the organization behaves ethically, then so does the entire organization (and if they behave unethically so too).
Every human is unique in terms of a wide range of variables right from skill set, capabilities etc. In the same way human responses and actions to situations may differ from one to the other which can be attributed to differences in norms, values, past experiences, cultural background or religious beliefs. Ferraro (2011) also argues the fact ethics is relative to culture, history, society, organization, individual experiences etc. Thus what might be ethically right for one may be unethical for the other. Certainly behavior is not solely influenced by personal values but being a member of an organization as well. Every organization has its own unique way of going about its business, which eventually tends to be the “culture hallmark” of that particular organization. An organization’s cultural standard is strongly influenced by top management or ethical leadership perceived as the statutory role models of an organizations set culture. They are also responsible in enforcing what is considered acceptable behavior and contrary to what is not through their ethical leadership and the organization’s code of conduct. As much as this might set the tone for ethical behavior, it is not guaranteed.
Mayer et al (2010) and Stouten et al.(2010) research has established ethical leadership to be effective in reducing employee misconduct, deviant behaviors, etc in the workplace (Mayer et al. 2009; Mayer et al. 2010; Stouten et al. 2010). On the other hand, an interesting study conducted by the Human Resource Institute (HRI) employing 1121 managers and human resource experts as participants uncovered the leading cause of unethical behavior is the overwhelming pressure mounted by management to meet certain unrealistic business objectives