Leadership Ethics and Team Leadership

ASCI Journal of Management 44 (1): 66–72

Copyright © 2014 Administrative Staff College of India

B. Lakshmi*

Leadership Ethics in Today’s World:

Key Issues and Perspectives**

Abstract

“Leadership” is in the spotlight today. Every aspect of leadership and its attributes are

being intensely examined, questioned and re-defined. The absence of respect, honesty,

integrity and trust at the leadership level would be catastrophic for any institution,

organization or company. The concerns about failure of leadership extends to all institutions

and groups and communities are responsible for social change whether they are governments,

business organisations or civil society groups. These concerns are being voiced at a time of

high expectations among citizens that leadership can address the political, economic, social

and moral challenges of their societies. In the present global context, unethical conduct

by leaders has brought ethics to the centre of discussion on leadership and its role in

today’s world. What constitutes ‘leadership ethics?’ How do we bring ethics into leadership

in practice? This paper looks at the importance of Leadership ethics as the main theme

with an overview of the key issues and perspectives on ethical leadership in theory and

practice.

Introduction

The term ‘Ethics’ is defined by the Oxford dictionary as ‘a set of moral principles’.

The discourse on ethics and ethical conduct is therefore about universal values and

concepts of right and wrong, good and bad. In simple words, ethics and morals both

relate to “right” and “wrong” conduct. However, ethics refer to the series of rules

provided to an individual by an external source, e.g. their profession or religion.

Morals refer to an individual’s own principles regarding right and wrong. A great

deal of attention has been given to these issues in the literature on the subject.

* Dean of Management Programmes, Professor and Centre Director, Human

Development, Area Chairperson, Health Studies Area, at Administrative Staff College

of India. (e-mail: [email protected])

** An earlier version of this paper was presented at the International Conference on

“Heart of Effective Leadership” organised by TIGE held at Caux, Switzerland, July

6-11, 2014.

Lakshmi Leadership Ethics in Today’s World 67

Theoretical approaches to the concept of ethics and ethical behaviour involve many

disciplines including philosophy, psychology and sociology, among other disciplines.

It is useful to briefly refer to the philosophical approaches to the concept of ethics

before looking at some of the issues in operationalizing ethics in the practice of

ethical leadership.

Conceptual Issues

There are many general approaches which leadership ethics can draw on to provide

a conceptual framework. Societies at different times and in varied cultural contexts

have tried to set out the attributes of “good” leadership in terms of moral principles.

Ancient texts refer to moral principles and moral choices for human action. The

Srimad Bhagavadgita mentions action that is “conducive to blessedness – imbued

with the quality of goodness.” (Text XVIII, 10:297). The text makes a reference to

an intellect that “correctly determines the paths of activity and renunciation, what

ought to be done and what should not be done…..” (Text XVIII, 30: 306). Moral

conduct is one of the major themes of the Gita.

The Confucian approach elaborates the necessity for virtue and morality in

leadership and the attributes of moral leadership. It holds the view that leadership

must be “equally based on moral principles and the ethical vision of a good life.”

(Becker, 2009, 9)

The Utilitarian approach formulated in the early nineteenth century by Jeremy

Bentham (1748-1832) and John Stuart Mill (1806-1873) – based on the attempt to

do “the greatest good for the greatest number of people” – is rooted in the principle

that ethical choices should be based on their consequences. Acting on the basis of

this principle implies “weighing outcomes” (Johnson, 1952: 155) with full knowledge

of the consequences – a principle that may not be easy to apply in actual contexts.

Other theories give priority to ‘Justice’ and the removal of inequality as the definition

of ‘fairness’- this is a view associated with the work of Rawls (Rawls, 1971).

The Kantian view based on the work of Immanuel Kant (1724-1804) is that there

are universal principles of morality that need to be acted upon without exception

and “people should do what is morally right” regardless of the consequences

(Johnson, 1952, 158).

There are many other systems of thought that have contributed to the discussion

on ethics and moral leadership. Normative perspectives on ethical leadership are

largely derived from one or more of these approaches. There is therefore no lack of

guidance from philosophy on the moral content of ethics and ethical choices.

68 ASCI Journal of Management 44 (1) September 2014

Leadership Ethics

Leadership Ethics is derived from value-based moral principles and include principles

such as justice, fairness, non-coercion, trust, integrity, honesty and transparency.

Johnson cites the work of Burns to differentiate between ‘terminal values’ such as

liberty, equality and justice and ‘instrumental values’ such as responsibility, fairness

and honesty (Johnson,1952: 190). In other words, there are broad abstract ethical

concepts, and these lead to other moral attributes derived from them, to be reflected

in the practice of ethics in leadership.

The emphasis on ethics in leadership is due to the fact that ‘effective’ leadership

may not be the same as leadership founded on ethical principles. Goal-directed

leadership alone, important as it is, may differ from a framework of leadership

based on ethics. Similarly, efficiency as an objective may not always or necessarily

be achieved by ethical means.

Ethical Leadership in Business Organizations

The enormous attention on the issue of ethical leadership at the present time

raises several issues. Given the importance of ethical leadership, how is this norm

to be attained in practice? The challenge is to move from the philosophical standpoint

as formulated in theoretical approaches and apply them to the real world where

clarity is needed on how ethical leadership acts to bring about change. Leaders are

in a position where they can and do influence outcomes. For this reason, the thrust

towards responsible and transformational leadership becomes important.

‘Transformational’ leadership is the “ability to make social changes” (Stewart, 2006).

This form of leadership, in Burns’ formulation, is one that “begins on people’s

terms, driven by their wants and needs.” (Quoted in Ibid: 10). This places greater

emphasis on the results of ethical leadership with the criterion that good leadership

is one where wider transformations are achieved.

The process of putting ethical principles into practice by leadership in organizations

is a prime requirement at the present time when unethical practices have gained

worldwide attention and the role of leadership is being increasingly questioned.

There is a growing realization that growth rates, profits and ‘numbers’ are not the

best indicators of successful organizational performance. There is a need for

emphasis to be shifted to a more value-based thrust in business organizations.

Where does one start in fostering leadership ethics in the business world?

The Caux Principles framed in 1994 are one example of efforts in this direction.

Inspired by the values and moral standards set out by Buchman in 1938 in Caux,

Switzerland and the emphasis on “the unity of our essential humanity”, the Caux

Round Table (1986) became a Forum “for business to articulate its worldwide social

obligations.” (Dalla Costa, 1998, 135). The ethical ideals on which the principles

Lakshmi Leadership Ethics in Today’s World 69

are founded are a respect for human dignity and the Japanese concept of kyosei

(living and working together for the common good). (Caux Principles, CRT website).

The seven principles of the Caux declaration have been re-framed following the

current crisis in global capitalism. The key principles include extending the

responsibility of businesses towards stakeholders, with obligations for honesty and

fairness; orienting the effects of business toward innovation, justice and world

community; to contribute to economic, social and environmental development.

(Ibid.).

Ethical Orientation in Business decisions

Leaders’ actions and decisions take place in a specific real-world context where

the abstract gives way to concrete reality. The abstract moral principles on which

ethics is grounded become the basis for ethics in leadership practice.

Leadership involves several areas where ethics and the moral commitment enter

in.

The leadership’s Vision and its articulation is a reflection of ethics in its framework

and content. . However, vision has no meaning if it is merely a long-term view of

goal-driven change, without moral foundations and moral commitment. There is a

need for vision to have clearly defined values, though vision may “implicitly” have

ethical notions of what is good. (Ciulla, 2005).

Ethics are of immense importance in leadership decision-making. This is the area

where ethical dilemmas often have to be resolved and where difficult choices have

to be made between right or wrong, good or bad. One of the suggested ways of

bringing ethics into business organisations is through an ‘Ethical Orientation’ plan

(Dalla Costa, 1998: 237). The plan looks at strategic decisions from an ethical

perspective. This can have an impact at all levels of the organisation by making

them more attuned to ethical norms and considerations. This would be a long-term

initiative that includes processes of management responsibility, employee and

contract areas, audits, etc. The ‘Implementation Plan for an Ethical Orientation’

(Ibid: 258) includes, for example, questions based on an ethical perspective:

� “How has an ethical orientation been integrated with strategy?”

� “How is senior management accountable for ethical performance?”

� “How is ethical orientation expressed in recruiting and hiring?”

� “Do all individuals in the company understand the ethical orientation and

their responsibility for compliance?”

These sample questions are a step forward in bringing ethics into the many aspects

of an organisation’s day-to-day functioning. Similar efforts to extend ethical

70 ASCI Journal of Management 44 (1) September 2014

orientation to more areas may go a long way in transmitting leadership ethics to

the rest of the organization.

The relationship of the leader with others is a key area where ethical leadership

matters. When we focus on leadership issues alone, there is a tendency to

underestimate the importance of the large number of people who are ‘followers’

of the leader. Building relationships based on trust, respect and equality and

establishing a “web of inclusion” is one of the tasks of responsible leadership (Dalla

Costa, 1998, 215). The role of leadership in this context is to ensure workplace

ethics by personal example and help to raise motivation levels.

Social responsibility has gained importance as a key area where ethical leadership

can act, with the involvement of employees, in a wider context to build a more just

society and further the articulated Vision of the organization.

Inner Governance: ‘The Heart of Leadership’.

The importance of leadership ethics and the need for ethical behaviour by leaders

brings the focus on to the leader. Since much depends on the personal qualities of

the leader, ethical awareness needs to begin with the leader herself/himself. The

starting-point is the view that one cannot influence others without fully

understanding oneself. The individual ethical value of leaders has to begin with the

self to have an impact on others. Through the process of self-knowledge, individuals

can become more attuned to the demands of ethical leadership and begin to

influence other people. This is one of the reasons for an emphasis on the importance

of inner governance in discussions of ethics as it represents “the heart of leadership.”

Beginning with the self is one way of gaining self-knowledge with the aim of gaining

self-control. Self-knowledge and self-control are stated to be the most important

factors in leadership development (Ciulla, 2003: 23). They open the way for the

“inner compass” that points one in the ethical direction (Mihelic et al, 2010: 5)

The process of beginning with the self is for ethical values to be internalized by the

individual. This can lead to the “complementarity” of the inner self and the outer

self (Waggoner, 2010: 31) that is necessary for ethics to become the basis for action.

Self-knowledge is aimed at developing capabilities for ethical leadership. Some of

these capabilities relate to emotional intelligence and the ability to understand

and respond to others. Another capability that is critical for leadership is to

“communicate a compelling vision to others” (Lash, 2002). The development of

these attributes can lead to an ethical framework in leadership practice.

Attaining self-knowledge is not without impediments. Challenges of attaining self-

knowledge include a proper understanding of introspection and other methods of

Lakshmi Leadership Ethics in Today’s World 71

knowledge. Introspection forms the basis of self-knowledge as no other method of

knowledge gives direct access to its objects. Direct access essentially includes

directness in epistemic sense as well as metaphysical. If access to one’s mental

states is epistemically direct, it must also be metaphysically immediate.

There is another extreme view that denies self-knowledge being truly special as

Ryle (1949) claiming that each of us is always present to observe our own behavior

and difference between self-knowledge and other-knowledge is merely a matter of

degree.

Looking Ahead

The challenges faced by today’s globalised world need to be addressed by a

perspective based on universal ethical principles. Ethical leadership is important

but so also is the need for ethics at every level of society. Bringing ethical

perspectives in every walk of life is the real challenge at the present time.

Since we are all interdependent and interconnected, there have been calls for a

“global ethic” to ensure that ethical practices are followed by all. (Dalla Costa,

1998:143). The global ethic is to be firmly rooted in justice, fairness based on

equality, respect for human dignity, and environmental responsibility. In Dalla Costa’s

words:

“The global economy, with its momentum, inconsistency and amorality, is

developing much more rapidly and substantially than the sense of global

community with which to moderate, interpret and ground it……(the global

economy) unleashes all that is selfish about human nature without a global

sensibility necessary for the well-being of humans and our natural

environment.” (Ibid: 20)

Developing that sensibility in leadership is the task ahead.

References

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Business Ethics, 2 (1):7-21.

Cuilla, Joanna B. (2013, December 10). Emerging Issues in Leadership: Culture,

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Dalla Costa, John. 1998. The Ethical Imperative: Why Moral Leadership is Good

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72 ASCI Journal of Management 44 (1) September 2014

Johnson, Craig E. 1952. Meeting the Ethical Challenges of Leadership: Casting

Light or Shadow. New Delhi: Sage 4th ed

Lash, Rick. 2002. Top Leadership: Taking the Inner Journey. Ivey Business Journal,

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Mihelic, Katarina Katja., et al. 2010. Ethical Leadership. International Journal of

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