In trying times there is greater danger of betrayal by those around you. Perhaps we should all be revisiting the psychological contract between employer and employee

Issues of loyalty have been making headlines in the past few months, notably regarding Gordon Brown and his colleagues, David Davis and the Tories, and Cristiano Ronaldo and his football club, Manchester United. But how important is loyalty in business? At what point, if ever, should one abandon it?

Being a leader is not easy and requires the support of those around you. It is not so difficult to gain their approval during periods of growth. But in more challenging times, ambition and self-protection take over and their loyalty may be discarded as a remnant of a bygone era.

Loyalty becomes significantly strained around ethical or legal issues. If a leader does something that is patently illegal or immoral, a loyalty dilemma surfaces, forcing the individual to consider his or her options. In these cases, loyalty can go only so far, before what will appear as disloyal action has to be taken. But the line is less clear when the leader is no longer effective in the job. What does the individual do then? Where does his or her responsibility lie—with the leader, or with the future of the organisation?

This is the ultimate moral dilemma in business, politics and many other contexts. And it may be further complicated by the fact that it is difficult to identify who is responsible for, say, a decline in business activity. Even if a leader has made a decision that clearly led to problems, did the economy have as much impact as any individual decision?

For me, if a valued and loyal leader makes consistently illegal and immoral decisions, I have no problem in following my own conscience, rather than the leader. But if the "loyal boss" makes difficult, but thoughtful and considered decisions in trying times, and they don't work, I would still feel a moral responsibility to support him or her, even if my self-interest might be adversely affected—indeed, even if I disagreed with the decision.

Particularly in trying times such as a downturn, loyalty is the cement that can strengthen our institutions. Without it, our businesses, politics and overall structures are more vulnerable to increasing pressures from outside forces, akin to a bursting dam. Even though, by the end of the 20th century, the UK was one of the leading economies in the world, the undermining of the psychological contract between employer and employee (through less job security, more outsourcing and the like) has led to nostalgic musings about the benefits of the paternalism of the past and concerns about the loss of loyalty by both employers and employees.

Perhaps this is an ideal time to reconsider the concept of loyalty and what it might mean for the business community, as we strive to work effectively as teams and to innovate in this highly competitive global economy. As Marcus Aurelius suggested in his Meditations around AD 170: "The human soul degrades itself... when it turns its back on another person or sets out to do it harm, as the souls of the angry (and self-interested) do."