Why Managers Matter: The Critical Link Between Culture, Ethics, and Trust in the Workplace
In conversations about company culture, ethical behavior, and leadership, it’s tempting to focus exclusively on senior executives—the visible faces of corporate decision-making. However, the real day-to-day culture of a workplace is shaped just as much, if not more, by direct managers. They are the interpreters, enforcers, and influencers of workplace values. They’re also the frontline for employee concerns, a critical channel for misconduct reporting, and the most visible representation of leadership for most employees.
In short: managers matter—a lot.
Ethisphere and the Culture Team measures workplace culture across eight core pillars, one of which focuses specifically on employees’ perception of their managers. Ethisphere’s data has totaled over 4 million employee responses from more than 300 organizations around the world. This allows us as culture analysts to continuously dig for insights, trends, and changes over time. Our data paints a clear and compelling picture: when managers are active, engaged, and ethical leaders, employees are more likely to observe and report misconduct, trust in the fairness of their organization, and believe in the integrity of senior leadership.
Let’s take a closer look at why managers are pivotal in shaping ethical, transparent, and values-driven workplaces—and what organizations can do to better support them.
Conversations Matter: Manager Engagement and Employee Perceptions
One of the most telling questions in our survey measures how frequently employees feel their managers initiate conversations on key topics related to culture and ethics. The answers to this one question correlate strongly with employees’ broader perceptions of integrity and accountability within their organization.
Consider this:
- Among respondents who said their manager frequently holds these conversations:
- 67% reported misconduct they observed.
- 88% believe the company enforces its non-retaliation policy.
- 95% believe senior leadership promotes doing business with integrity.
- 90% believe senior leadership acts with integrity.
Now compare that to respondents who said their manager never holds these conversations:
- Only 37% reported misconduct they observed.
- Just 48% believe the non-retaliation policy is enforced.
- A mere 52% believe leadership promotes integrity.
- Only 44% believe senior leadership acts with integrity.
**This data is comprised of surveys administered between January 2022 and November 2024**
This contrast is stark. It suggests that when managers are engaged and vocal about values and ethics, they help employees develop greater trust in their organization. These conversations don’t just reinforce expectations—they act as a signal that integrity is truly valued, from the bottom to the top of the organization.
The Trust Factor: Managers Are Seen as More Ethical Than Senior Leaders
Another insight from our data: 91.2% of respondents believe their manager is committed to ethical conduct, compared to 78.4% who say the same of senior leadership.
This trust gap is not necessarily a reflection of poor executive leadership—rather, it’s a natural outcome of proximity and visibility. Most employees work closely with their direct managers on a daily basis. In contrast, they rarely see senior executives in action. This distance can breed skepticism or create an “us vs. them” mentality, especially during challenging periods like restructuring or downsizing, where the reasoning behind decisions is often opaque.
In this context, managers are the bridge between employees and the C-suite. They translate vision into action, deliver key messages, and provide context and reassurance when difficult decisions are made. Their role in echoing leadership messages—and bringing employee concerns back up the chain—is crucial for building a consistent, trustworthy culture.
The Most Trusted Channel for Reporting Misconduct
Perhaps one of the clearest indicators of the manager’s central role in workplace integrity is their role in misconduct reporting.
When we asked employees about the channels they used to report misconduct, the data was unequivocal:
- 59% reported through their manager.
- Face-to-face reporting was significantly more common than using hotlines 11% or web portals 8%.
Why? Because reporting is not easy and people want to report issues to someone they trust. And that trust most often resides in the relationship with their direct manager.
However, while managers are the most-used channel, there is clear room for improvement in the satisfaction of that reporting experience.
Where Managers Fall Short—and Why It Matters
Only 64% of respondents were satisfied with how their report was handled when they reported misconduct to their manager.
When asked why they were dissatisfied, the top reasons included:
- 30%: Concerns about how the process was handled by the manager.
- 30%: Lack of information throughout the process.
- 32%: Belief that the outcome of the investigation was unfair.
- 37%: Belief that the outcome was unclear.
These responses reveal a common theme: communication and process transparency. While it’s not always possible (or advisable) to share every detail of an investigation, employees need to feel that their concern was heard, taken seriously, and resolved fairly.
This is where organizations must focus on manager enablement. Simply put, managers need better training, resources, and support systems to handle reports of misconduct effectively and ethically. Equipping them with investigation toolkits, communication templates, and guidance on what they can (and can’t) share will go a long way in closing this gap.
The Case for Investing in Managers
The data paints a clear picture: managers are critical influencers of workplace culture and employee perception.
They are:
- The primary touchpoint between employees and leadership.
- The most trusted channel for raising concerns.
- The daily embodiment of company values and ethical expectations.
Yet they’re often asked to play these roles without the right preparation or support.
Organizations that want to build a culture of integrity, transparency, and accountability must prioritize manager development—not just in terms of performance management or team productivity, but in their ability to:
- Foster open conversations around ethics and culture.
- Navigate employee concerns with empathy and fairness.
- Deliver sensitive messages from leadership with clarity and consistency.
- Build trust through transparent communication.
Action Steps: How to Support Managers as Culture Leaders
To truly empower managers as culture carriers and ethical leaders, organizations should consider the following steps:
- Provide Targeted Training
Go beyond basic compliance training. Offer interactive sessions that help managers understand their role in shaping culture, responding to reports, and facilitating difficult conversations.
- Develop Manager Toolkits
Equip managers with ready-made resources—such as sample scripts, reporting process guides, and FAQs—to help them navigate complex situations with confidence.
- Create Feedback Loops
Encourage two-way communication between managers and senior leadership. This helps ensure that employee concerns are heard at the top—and that messaging from leadership is grounded in real workplace dynamics.
- Recognize Ethical Leadership
Celebrate managers who demonstrate integrity, transparency, and a commitment to culture. Recognition reinforces the behaviors you want to scale across the organization.
- Monitor and Measure
Use tools like engagement surveys or culture assessments to measure perceptions of manager effectiveness and identify areas for support or intervention.
Conclusion: Managers Are the Culture Carriers
Culture isn’t something written in a handbook—it’s shaped by everyday actions and interactions. Managers hold the keys to trust, accountability, and integrity within the workplace. And when they are engaged, equipped, and empowered, the ripple effect can be seen throughout the organization—from how employees perceive leadership to how likely they are to speak up when something feels wrong.
If companies want to create strong, ethical, and resilient cultures, the path forward is clear: invest in your managers. Because when managers succeed, the entire organization stands on stronger ground.
Malthe Helt is a Culture Analyst at Ethisphere.
Editor’s Note: Unless otherwise stated this data referenced in this article comes from surveys administered in 2024.
