The Importance of Leadership Qualities in Small Business Owners: The Strength to Do What is Right

I have had several discussions with Chief Executive Officers and Owners of Businesses over the last few weeks, challenged with various compliance requirements for their business or the organisation they run.

I have reminded a few, particularly those with boards of directors like Clubs and Not-for-Profits, that they are responsible for leading and guiding the board or organisation.

Just because someone else is doing or not doing business in a particular way doesn’t mean they are right or you should follow them.

Just because you don’t agree with a rule or a law doesn’t mean that you can decide not to follow it or avoid it without consequences.

Times have changed, and some organisations are operating in old mindsets that are no longer valid. As a leader, you must open your mind to new ways of thinking, challenge the existing and embrace the new.

Operating a small to medium business, whether it be a Club, not-for-profit or small business, is complex. The CEO or owners wear many hats: entrepreneur, problem solver, marketer, etc.

However, one role that must never be compromised is that of a leader. Good leadership navigates a business to success and establishes a solid ethical foundation, especially when managing compliance.

 This post will delve into the necessity of leadership qualities in small business owners and why doing what is right, rather than what is easy or popular, is crucial.

Leading by Example   

A small business owner sets the tone for the entire organisation. When an owner demonstrates high standards, work ethic, and integrity, these qualities often trickle down to the employees. Being a role model in the company provides an example for staff to emulate, fostering a culture of accountability and trust.

Doing What is Right, Not What is Popular   

In today’s competitive business environment, cutting corners or following the herd to keep up is tempting. Whether it’s questionable marketing tactics, dubious accounting, skipping Fairwork laws or money laundering and terrorism financing requirements, the allure of quick gains can be tempting. However, these shortcuts often come at a cost, not just legally but also to the business’s reputation.

The Long-Term Benefits of Ethical Leadership   

When a small business owner opts for the path of integrity, especially in matters of compliance, the benefits are multi-fold:

Legal Protection  

Being on the right side of the law is beneficial. Penalties, fines, and legal issues can break a small business.

Public Perception  

Customers are more discerning than ever about the businesses they support. Ethical lapses can lead to boycotts, bad reviews, and, ultimately, a loss of business.

Employee Satisfaction  

Staff members are more likely to stay long-term in a company where they feel the leadership is transparent, honest, and fair.

Competitive Advantage  

Believe it or not, integrity is a competitive advantage. Your business’s ethical standing can be the differentiator in a marketplace where everyone offers similar products or services.

The True Mark of a Leader   

Leadership is not just about guiding your team to hit quarterly targets; it’s also about creating a legacy of ethical conduct and fairness. Leadership calls for the courage to make tough choices, often in the face of adversity or popular opinion.


In summary, the importance of leadership qualities in a small business owner cannot be overstated.

Leaders prioritising doing what is right over doing what is convenient are more likely to build sustainable, respected, and successful businesses.

When it comes to managing compliance and ethical standards, the strength to stand firm on principles is the true mark of a leader.

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