In 1 Timothy, Paul was encouraging Timothy both to stand against false teachers in the church at Ephesus and to teach sound doctrine to the Ephesian church. In order to understand the full importance of this description of the character of faithful overseers, we must understand something about the nature of the false teachers in Ephesus.
The false teachers came from among the Ephesian elders
Paul had warned the Ephesian elders in Acts 20 that fierce wolves would come from among them (20:29). Paul’s statements implies that these false teachers would actually come from among the Ephesian elders themselves (20:30). So these false teachers who were seeking to destroy the church and who were speaking twisted things originated from among the church leaders in Ephesus.
The character of the false teachers’ lives demonstrated that they should not be leaders
Imagine you are in a church where some of your pastors are false teachers and some of them are sound teachers. How will you distinguish between these two groups? One way is to look at the character of their lives. Paul characterized the lives of the false teachers as full of conceit, envy, strife, quarreling, love of money, etc. (1 Timothy 6:3-5), whereas the lives of the sound teachers should be characterized by the kinds of qualities outlined in 1 Timothy 3:1-7.
In sum, this background helps us understand several things about 1 Timothy 3. Paul begins by affirming that desiring leadership in the church is not a bad thing, but desiring church leadership for financial gain is. So church leadership should only be given to those whose lives demonstrate the truth that they are to teach. Faithful church leaders will demonstrate the kind of living that flows from the gospel, and so they should not be entrusted with leadership unless their lives are above reproach, unless their lives demonstrate a life changed by the grace of God. So for a church struggling to determine which leaders should be honored and which leaders should be rejected, that church should begin with a look at the character of these men because faithful leaders will demonstrate faithful character.