The phenomenon of leadership is one of the most broadly discussed in management-related scholarship. Various theories and models are designed in order to develop an understanding of the scope of leadership as a concept and the traits, necessary for an individual to exhibit strong leadership and inspire followers. In this regard, a crucial question remains whether leadership can be learnt in case an individual does not have a natural disposition to leading. In the end of the 19th century particularly the ‘Great Man’ theory, emphasizing one’s intrinsic ability to lead followers, was the major approach to leadership, logically excluding the phenomenon of learnt leadership.
Thereafter a trait theory of leadership that emerged in the 1930-1940s partly challenged the intrinsic view of leadership, stating that one can also acquire leadership traits by learning. Another trend that accompanied the emergence of the trait theory of leadership dealt with the fact that scholars and practitioners started to single out specific concepts and personality characteristics, concerned with leadership. According to Zaccaro, specific combinations of traits and attributes are more capable of predicting leadership than the presence of several single traits (15). As it was further specified by Derue et al, major leadership traits, addressed by scholars in the field of management and leadership in their studies, include demographics (age, gender, social status and education); task-related competencies (conscientiousness, intelligence, openness to new experiences, technical knowledge) and interpersonal characteristics (extraversion, emotional intelligence) (15).
Following the emergence and development of the treat theory of leadership special emphasis started to be put on the peculiarities of leaders’ behaviours. The rationale for the development of the behavioural perspectives on leadership deals with the emergence of psychometrics and related researchers’ ability to measure the cause and implications of specific behaviours, using the factor analysis. According to Derue et al (2011), the most important characteristics of leaders’ behavior include task orientation, orientation on relations, as well as readiness to change (17).
The 1960s were marked by the development of contingency approaches to leadership, claiming that each particular situation requires a specific approach to leading and inspiring followers. That is why, the proponents of contingency (or situational leadership) perspective argue that a n individual leadership style represents a combination of multiple styles and approaches, determined by a specific situation.
In turn, the 1970s were characterized by the emergence of the dichotomy between transactional and transformation approaches to leadership. Transactional theories claim that followers’ motivation is mostly determined by rewards and punishments that are to be balanced by a leader to achieve mutually beneficial efficient relations with followers. On the other hand, transformational leadership states that trust and commitment to common goals.
Along with the central problems of learnt leadership, effectiveness of different leadership styles and motivation, the interrelation of ethics and leadership started to be actively considered by leadership scholars in the late 20th and early 21st century. An interest to the issue of ethics, incorporating ethical principles into leadership and ethics-based decision-making is determined by the fact that modern leaders face ever more complicated situations that require not only cost-effective, but ethical solutions. While one can think that such situations can be faced solely by political and religious leaders, it is important not to forget that nowadays multinational corporations play an important role in establishing the policy and legal frameworks for the solution of specific issues. Moreover, the activities of multinational corporations are tightly interrelated with the issues of the observance of international human rights standards and environmental regulations (Schaulbroeck&Malonson 1). In view of the above, it is of special interest to consider the concept of ethical leadership, its reflections in managerial practice and daily operations, conducted by employees.
The concept of ethical leadership
Ethics is a philosophical notion that originates from the Greek word “ethos” that can be defined as a “custom” or character”. Ethics deals with addressing and prescribing the models of moral behaviors, provided that there are acceptable and inacceptable ways of behaving in different situations, especially those, concerned with a need to balance the interests of different groups. According to Sims, ethical behavior can be addressed as a moral behavior that is considered to be “right” or “good” from the standpoint of morality as opposed to “wrong” and “bad” in a specific situation (507). Apart from morality, ethics is also tightly interconnected with law. Therefore, it can be stated that a specific behavior is considered ethical, when it is legally and morally acceptable in a specific situation. Most commonly, the issues of ethical and unethical behaviours emerge with regard to the so-called ethical dilemmas, emerging from uncertain situations, where the rights and interests of multiple stakeholders are concerned.
According to Michelic et al (2010), in organizational context ethics can be addressed as a frank conversation regarding the values and problems that are most important to involved stakeholders and business as such (33)). In general, it is worth mentioning that the application of ethics with regard to business, management and leadership is to great extent concerned with a range of notions, such as values, trust, honesty, consideration dignity and the rights of others (Brown et al 120). The notion of organizational values constitutes a cornerstone of discussing ethics in the context of organizations’ operation.
That is why, Freeman and Stewart tend to consider ethics in business as a continuous process of defining, reconsidering and evaluating ones’ values and principles. In this regard, it is necessary to underline that organization values serve as a basis for organizational culture and, therefore, a personality of an organization.
Similar to ethics, leadership can be defined in multiple ways, dependent on the context, as well as the application of specific leadership theories and concepts. In the most general terms, the notion “leadership” can be addressed as an art of inspiring and persuading a follower to wish to complete tasks that are required to reach the goals, set by the leader.
Therefore, the major role of a leader is to inspire, persuade and direct followers in relation to a specific goal. Specific on-site manifestations of the core leadership function, addressed above, can significantly vary, dependent on the peculiarities of the organizational context, organizational values, one’s leadership style and the mode of relations between a leader and followers.
In view of the above, ethical leadership represents an ambiguous concept that tends to include multiple elements. According to the overview of ethical leadership-related literature, conducted by Michelic et al (2010), the scope of the construct “ethical leadership” includes (but is not limited to) a leader’s commitment to his own moral values, adherence to the universal moral values, as well as enabling followers to do the “right” things (32).
An extensive review of literature by Brown et al (2005) resulted in the development of the following definition of ethical leadership. According to their view, ethical leadership represents a reflection of the normatively appropriate behavior with the help of personal actions and interpersonal links, as well as the promotion of such conduct among followers through the mode of a leader’s communication with followers, empowerment and decision-making strategies.
The definition, offered by Brown et al (2005) brings together a range of elements, constituting the scope of the construct “ethical leadership”, demonstrating strong interdependencies and reinforcing each other. First of all, it is argued that ethical leaders tend to serve as role models for staff members in organizations in relation to their moral image and the normatively acceptable conduct. Secondly, ethical leaders communicate their vision of morally acceptable conduct and their own actions to followers. Thirdly, ethical leaders use such visions as a foundation for empowering followers. Finally, an ethical leader relies on ethics, while making decisions.
An interesting two-element construct of ethical leadership was also developed by Enderle. According to his empirical research, an ethical leader can be distinguished by the fact that he/she is capable of singling out an ethical dimension that is present in any situation that requires making a decision. Secondly, Enderle argues that an ethical leader is capable of considering a specific decision-making context and founding his/her decision on specific ethical principles (659-660).
The manifestations of ethical leadership by leaders and staff members
As it was previously mentioned, a construct of ethical leadership finds its manifestations in multiple dimensions of leaders’ and managers’ work. For the purposes of current study, a range of such dimensions will be explored. They include the formulation and practical adherence to organizational values, leader’s traits, leader’s relations with followers and the mode of decision-making.
In organizational and leadership context, the notion “ethics” is tightly interconnected with organizational culture and values as founding principles of an organization and practical guidance for its actions. Therefore, it may be argued that ethical leadership needs to include leaders’ clear vision and formulation of organizational values and using them as guiding principles, when building up solid relations with followers and making decisions. The values, most commonly incorporated into a culture of modern organizations, include accountability, balancing the needs of business and employees, commitment, respect for diversity, focus on people and their empowerment, as well as integrity and ownership.
Accountability is one of the crucial values that needs to be taken into account, when leaders communicate with employees and make decisions. It can be addressed as acknowledging and managing responsibility for a company’s policies, actions and the quality of its products and services. The issue of accountability often comes to the surface in relation to corporations’ leaders’ policies and decisions, where the conflict of business interests and the ones of human rights or environment protection takes place.
While employees represent one of the core assets of companies in the era of the “knowledge-based economy”, it is crucial for companies to behave in a legally and morally acceptable way in relation to its employees. In this regard, leaders of many companies tend to state that they take into account (or even emphasize) the interests of employees, when making decisions regarding business’ development (e.g., outsourcing, growth).
Respect for diversity and non-discrimination constitute the core principles of an ethical leader’s attitude to employees. Employees shall be granted equal rights and opportunities in relation to all the workplace issues, such as access to vacancies, pay, promotion etc.
Commitment means that an organization recognizes an impact of its policies, decisions and the quality of its products and services on individuals’ lives and does its best to meet highest normative and technical standards. Integrity means an emphasis on telling the truth, despite possible obstacles. Finally, the principle of ownership relates to the fact that company’s leadership and employees take special care of the company and customers, going beyond standard legal requirements.
Apart from organizational values, ethical leadership is also concerned with leader’s personal values (e.g., family, happiness, health, love, successful carrier etc.), social values (e.g., peace, ecology, sustainable development, human rights), moral values (e.g., solidarity, honesty) and the values of competition (e.g., general good, mutual benefits, money etc.)
Leader’s traits represent the second crucial dimension that tends to be associated with the practical reflection of the ethical leadership concept. According to the conceptualization by Zanderer (1992), ethical leaders are humble, concerned with the greater good, as well as honest and straightforward. It is also important that ethical leaders always fulfill their commitments and promises, strive for fairness and exhibit enough courage to explicitly exhibit values and protect what is right in difficult situations. Moreover, it is emphasized that such leaders are open for communication and even critique, expressed by their followers and always try to develop others (7-10).
As opposed to ethical leaders, unethical ones are characterized as being arrogant, mainly self-serving, actively promoting self-interest, breaching agreements and even involved in deception. Furthermore, unethical leaders may deceive their followers and lack courage and commitment in order to strive against unfair acts.
Leaders’ behaviours represent a crucial domain of ethical leadership. Most commonly, leaders’ relations with followers and the mode of decision-making are considered as areas, wherein it is easy to assess whether a specific leader behaves in an ethical way. Based on the above areas of leaders’ actions, Yukl and Yukl (2002) elaborated a set of criteria to distinguish an ethical leader from an unethical one.
The first criterion deals with the aims a leader pursues, when using his/her leadership powers and potential. An ethical leader is expected to serve an organization and his/her followers, emphasizing the adherence to organizational values. On the contrary, an unethical leader is expected to exploit his personal leadership potential and authorities in order to satisfy his/her personal needs and follow career objectives. Ideally, an ethical leader is expected to be not so much interested in promotion and career.
The second criterion is the way a leader deals with the colliding interests of multiple stakeholders. While an ethical leader tends to balance and integrate them, using legal and moral rules, an unethical leader may favour the interests of a specific group, whose members may offer the most benefits to a leader.
When developing a vision for an organization, an ethical leader uses followers’ input, needs and interests as a foundation for his/her work. An unethical leader uses his/her personal vision and self-interest as a basis for developing an organization’s vision and formulating its goals. As ethical leader is expected to be guided by the principle of integrity, he/she acts consistent with this principle, even if such action may harm his/her personal interests and reputation. Capable of deceiving his/her followers, an unethical leader tends to prioritize his/her personal interests and goals.
A highly important criterion for distinguishing an ethical leader from an unethical one is his/her disposition to risk-taking in leader decisions and actions. An ethical leader is expected to have enough courage to accept personal risks and make a necessary decision, despite its unpopularity. On the contrary, an unethical leader will avoid making a necessary decision in case it incorporates a personal risk for a leader.
Two-way communication is a crucial dimension of leadership due to the fact that inspiring followers to act to reach the goals, set by a leader, represents a key leadership function. Ethical and unethical leaders are highly different with regard to the way they disclose relevant information to their followers and communicate with them. An ethical leader discloses information in a complete and timely manner, not avoiding talking about issues, personal concerns and failures. It is also important to underline that an ethical leader is ready to criticism and encourages followers to express their opinion regarding current issues in order to find the best solution.
The communication with a leader is a domain, wherein employees in an organization can show ethical leadership. First of all, employees are expected to refer their concerns regarding the organization of the working process and leader-follower relations to a leader in order for him/her to take actions. It is important for employees to adhere to the principles of ethical leadership, because they directly influence the level of trust in a team, employees commitment and their readiness to accept accountability. A chance to refer concerns to a leader helps employees to develop trust to a leader as a person and an organization in general, promote commitment, as well as create favourable working environment. Secondly, an ethical leader provides employees with an opportunity to express substantial concerns, openly deliver their opinions during group discussions and criticize leaders’ actions. This criterion is also crucial, because its fulfillment ensures finding best solutions for an organization’s tasks. While an ethical leader highly favours two-way communication and its implications, an unethical leader uses deception to avoid disclosure of data and suppresses criticism.
Finally, an ethical leader aims to develop followers’ skills and empower them. An unethical leader tends to deemphasize development to promote employees’ dependence on a leader.
Ethical leadership is a rather novel concept for leadership studies. However, there is no unified approach to defining its scope by scholars. The study of secondary sources suggests that the adherence to moral values, specific character traits (e.g., integrity, fairness) and behaviours (e.g., risk-taking, openness to criticism, risk-taking) represent the major domains of ethical leadership. Communication with followers and decision-making are the major areas that are to be assesses to determine whether a specific leader can be characterized as ethical. Ethical leadership is important for employees in two major domains. First of all, they have a chance to express their opinion regarding working conditions and the organization of work, improving the working environment and facilitating trust. Secondly, openness of communication helps employees reach best solutions for the substance of their work.
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