Many companies fail with each passing day. There are obvious grounds for their demise. Some include lack of competitive advantages, financial risks that did not bear returns, a weak economy, rapidly changing customer preferences, or account manipulations that appeared wise at the time. Also, it is important to consider the ethical and moral stance of the firm and the responsibility of leadership in developing a culture of the enterprise (O’Toole and Mayer, 2013). Management in most cases is the key reason for the failures of companies due to bad leadership choices similar to the reasons stated above. The CEO’s can manipulate their accounts to avoid paying debts or taxes. This paper casts a critical glance towards ethical leadership in business.
According to Yidong and Xinxin (2012), a leader is expected to be neutral in his or her operations. The condition involves not favoring particular people. Occasionally, human nature gets the best of the managers, and they find themselves preferring certain individuals compared to other due to different aspects. Regardless of one’s personal opinions, neutrality is the best moral stand to maintain good relations and cohesiveness in the business (Neubert et.al, 2013).
Another ethical issue that may arise from bad leadership is an egocentric nature. A manager should listen to his or her subordinates’ ideas. An egocentric person assumes that he or she knows what is best and enforces their wishes on people without considering their perspectives. The aspect destroys communication lines since employees operate under pressure and fear to conform to the dictatorship of the leader (Marsh, 2012).
All the ethical dilemmas above can be solved when the manager cultivates the appropriate leadership skills based on managerial theories and models. A leader must influence his followers ethically by making the best choices for the well-being of the people and corporation through utilitarianism. The ethical model requires managers to make decisions that satisfy the interests of various stakeholders. Such choices will eliminate the use of egoism and manipulation of accounts due to personal greed (Flucker, 2009).
Ethical leadership according to Aristotle involves the duty of respecting others and listening to their opinions. Managers who value other individuals give them room to be themselves to develop their creative desires and wants (Xu et.al, 2014). Respect is the fundamental guideline of morality and democratic leadership since it empowers someone to formulate value-based strategies that bring positive outcomes. According to the deontological approach, a manager should assess various initiatives to establish if they are good or bad for the development of the firm (Avey et.al, 2012).
Avey J.B. et.al. (2012). Exploring the Process of Ethical Leadership: The Mediating Role of Employee Voice and Psychological Ownership. Journal of Business Ethics, Volume 107, Issue 1, pp 21-34.
Flucker W. E. (2009). Ethical Leadership: The Quest for Character, Civility, and Community. New York: Fortress Press.
Marsh C. (2012). Business Executives’ Perceptions of Ethical Leadership and Its Development. Journal of Business Ethics, Volume 114, Issue 3, pp 565-582.
Neubert M. J. et.al. (2013). The Influence of Ethical Leadership and Regulatory Focus on Employee Outcomes. Business Ethics Quarterly / Volume 23 / Issue 02 / pp 269-296.
O’Toole J. and Mayer D. (2013). Good Business: Exercising Effective and Ethical Leadership. New York: Routledge.
Xu A. J. et.al. (2014). Ethical Leadership Behavior and Employee Justice Perceptions: The Mediating Role of Trust in Organization. Journal of Business Ethics, pp 1-12.
Yidong T. and Xinxin L. (2012). How Ethical Leadership Influence Employees’ Innovative Work Behavior: A Perspective of Intrinsic Motivation. Journal of Business Ethics, Volume 116, Issue 2, pp 441-455.