Leadership Lessons from Confucius: unintended consequences

Beijing Confucius Temple: unintended consequences

Confucius said: “If you lead through laws and regulations and maintain order through punishments, people will avoid them but won’t develop a sense of shame. If you lead through virtue and keep them in line with ritual, they will develop a sense of shame and unite behind you.”

Whenever government or business leaders are faced with an ethical crisis, their instinctive response is to pass a raft of new legislation, regulations, rules, and codes of conduct to “solve” it. While in the short term this approach may give the illusion that they are “doing something” (not to mention generating some handy headlines), in the long term it has the highly corrosive effect of widening the gap between the elite and the people and increasing the level of state interference into individuals’ lives.

The approach advocated by Confucius is almost diametrically opposite to the conventional command and control model. He saw the constant introduction of more legislation and regulations as highly counter-productive because the law of unintended consequences kicks in and people will experience no sense of shame in developing ever more creative ways of evading them. You only have to look at how the global “tax planning” industry works today to appreciate the validity of his analysis.

Confucius advocated an alternative model in which the leader establishes the right moral tone for people to follow through the act of being virtuous rather than attempting to persuade or compel them to behave in the appropriate way. By setting the right example, the leader creates a positive self-reinforcing culture that ripples through all levels of a society or organization. Laws and regulations ultimately become unnecessary because the people instinctively know how to behave appropriately and have ritual, the unwritten code of social conduct, to guide them if they are unsure of what to do.

The idea of leadership through virtue was no by means new even during the lifetime Confucius. It has its roots in the legends about the mythical reigns of the early sage kings who laid the groundwork for building the Chinese nation. Laozi also drew his inspiration from the same source for the principle of effortless action (無為/wúwéi) that he promoted in the Daodejing (道德經).

Given the growing mistrust that is emerging between the one percent and the remaining ninety-nine percent, it’s time to revisit this ancient concept. Even just a single virtuous act that inspires people to do something worthwhile is worth so much more than thousands of pages of dense rules and regulations.


This article features a translation of Chapter 3 of Book 2 of the Analects of Confucius. You can read my full translation of Book 2 here.

I took this image at the Temple of Confucius in Beijing. You can read more about it here.

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