ethical leadership

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Ethical Leadership(Lesson-7: BECG)

Prof. C. AnandFaculty – IBS, Hyderabad

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Contents

This deals with:-1. Definition of Ethical leadership2. Understanding Ethical Leadership3. Five Standards of excellence practiced by Ethical

Leaders4. The 7 Cs of Success for Ethical Leadership5. Personal Integrity and Self Development6. Wisdom-based Leadership

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1. Definition of Ethical leadership Ethical leader is he who operates by high ethical

standard. A reputation for ethical leadership rests upon two

essential pillars:-1. Perception of self as both mortal person and a

moral manager. The executive shall be a moral person that has positive traits (integrity), behavior and decision making skills.

2. The leader should have excellent communicating skills and values by being role model and developing a management system that constantly reveals acceptable behavior and disciplines unacceptable behavior.

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2. Understanding Ethical Leadership

Ethical leaders provide the guiding force to move an organization toward greater accountability by matching words about values with visible actions that demonstrate respect for every employee (Trevino, Hartman & Brown, 2000).

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2. Understanding Ethical Leadership (contd.)

The term ethics comes from the Greek word ethos, which has been translated into a variety of terms such as disposition, manners and character. Angeles (1992) defines ethics as

“1) the analysis of concepts such as ought, should, duty, moral rules, right, wrong, obligation, responsibility, etc., 2) the inquiry into the nature of morality or moral acts., and 3) the search for the morally good life.”

The definition reveals that the term ethics has a multidimensional nature that transcends simple descriptions.

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It is important to look at the business landscape in light of the recent economic trends. Charan & Useem (2002) note that the bear market in 2001-02 created a situation that

“…26 of America’s 100 largest corporations lost at least two thirds of their market value, including such blue chips as Hewlett-Packard, Charles Schwab, Cisco, AT&T, AOL Time Warner, and Gap. In the 1990 bear market, by contrast, none did, according to money management firm Aronson & Partners.”

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2. Understanding Ethical Leadership (Contd.)

Ten reasons why even apparently successful organizations experience major employee firings, dramatic loss of stock values and other major negative events:

1. Leaders who are enamored by their success and fail to ask the tough questions.

2. Leaders who see no evil and ignore the negative reports about their company.

3. Leaders who have a greater fear of their boss than their competition.

4. Leaders who take excessive risks with their financial resources.

5. Leaders who have been consumed by making undisciplined company acquisitions.

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6. Leaders who listen more to the Wall Street analysts than

their employees. 7. Leaders who rely on quick fixes for major problems. 8. Leaders who foster a company culture that lacks

accountability. 9. Leaders who cannot handle negative news and let the

company fall into a death spiral. 10. Leaders who are led by a dysfunctional board.

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The dark side of leadership is represented by individuals that rise to power and fame but their success is built on a faulty foundation. Al Dunlap is cited by business experts as an example of an unethical leader who lied about serious financial problems at Sunbeam and emotionally abused his employees. Dunlap was well-known for helping struggling companies become profitable, but his fame came at a high price. Dunlap earned the nickname “chainsaw” because he was known for firing thousands of employees to boost stock prices.

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3. Five Standards of excellence practiced by Ethical Leaders

The five standards of excellence practiced by ethical leaders are:

1. Communication2. Quality3. Collaboration4. Succession Planning5. Tenure

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4. The 7 Cs of Success for Ethical Leadership

1. Clear Conception2. Strong Confidence3. Focused Concentration4. Stubborn Consistency5. Emotional Commitment6. Good Character7. Capacity to enjoy the process a long way

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“In Dunlap’s presence, knees trembled, and stomachs churned. Underlings feared the torrential harangue that Dunlap could unleash at any moment. At his worst, he became viciously profane, even violent. Executives said, he would throw papers or furniture, bang his hands on his desk, and shout so ferociously that a manager’s hair would be blown back by the stream of air, that rushed from Dunlap’s mouth”

**The End**

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The End

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ethical leadership

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