Every leader will eventually encounter the challenge of managing a talented but unethical employee. Start by engaging him. If you assign meaningful tasks, make him feel valued, and treat him like an adult, he’ll be more likely to act ethically. This is the time to employ peer pressure: partner your less-moral employee with a colleague who has strong integrity to motivate the former to behave better. Managers also need to reduce temptations.
Help those with weaker self-control by monitoring them a bit more and persuading them that the company truly values generous, altruistic behaviors. To do this, lead by example. The leader’s morality level determines whether employees perceive the organization as ethical or unethical. If you want employees to act morally, you have to act morally yourself.
Adapted from “Managing the Immoral Employee” by Tomas Chamorro-Premuzic.