Given the increase in organizational downsizings, layoffs, asset write-offs and executive bailouts, how important is the trust factor in defining a good leader? Without an established trust relationship a leader is unable to be effective. The problem to be investigated is the value of trustworthiness and ethical stewardship in the construct of the organizational leadership model. This paper shall explore the co-functions of trust and ethical stewardship and its impact on leadership effectiveness.
Introduction
In 2012, there is very little allegiance or loyalty among organizational members. This is partly due to the recent increase in corporate scandals and the outsourcing of many jobs to foreign countries. Once upon a time in America, one could work a job and retire on that same job after twenty-five or thirty years. The days of working longevity and retiring from the same job are pretty much history. Because of this, organizational members have become distrustful of management. Covey realized that “low trust is the first chronic problem that all organizations face” (Covey, 2004, p. 107). This lack of trust undermines employee commitment and impairs wealth creation (Caldwell et al., 2010, p. 497). This paper will explore and discuss the value of trust and ethical stewardship and its impact on leadership effectiveness.
Trust and Ethical Stewardship
According to Ingenhoff and Sommer, “there is a confusing variety of different definitions
of trust” (Ingenhoff and Sommer, 2010, p. 340). Most logical people will never follow a leader that they do not trust- morally, ethically or intellectually. The author feels that a leader should be moral, ethical and intellectually knowledgeable of the subject m...
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...ess, and ethical stewardship. Journal of Business Ethics, 96 (4), 497-512. Doi:10.1007/s10551-010-0489-y
Covey, S. (2004). The 8th habit: From effectiveness to greatness New York: Free Press
Friedman, M. (1970). The social responsibility of business is to increase its profits.
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Ingenhoff, D. & Sommer, K. (2010). Trust in companies and in CEOs: A comparative study of the Main influences. Journal of Business Ethics, 95 (3), 339-355. Doi:10.1007/s10551-010-0363-y
Jennings, M. (2012). Ethical Theory, Philosophical Foundations, Our Reasoning Flaws and Types of Ethical Dilemmas In R. Dewey (Ed.), Business ethics; Case studies and selected readings (pp. 34-37). Mason, OH; South-Western Cengage Learning.
Leaders who treat their employees with fairness, honesty, and provide frequent, accurate information are seen as more effective. According to Robbins and Judge (2014), “trust is a primary attribute associated with leadership and followers who trust a leader are confident their rights and interest will not be abused” (p.193). The old General Motor Corporation had eleven different CEO’s from 1923 until 2009 each with their own unique leadership style, which directed employees toward the organization goals. Unfortunately, many of the top level managers under the CEO’s had the tendency of filtering out information that did not match up with their pre-conceived notions about a particular issue and they lacked upward communication. One consumer goal of General Motors was to build trust in the company so people would be repeat customers, but building trust between employees and establishing an ethical culture was not a top priority of the organization. Goal directed leadership alone is important, but differs from a structure of leadership based on ethics. It is important to note, that effective leadership may not be the same as leadership founded on ethical principles. Business competence must exist, along with personal leadership accountability in ethical decisions. Within the General Motors organization, ethics and leadership did not interconnect; there were misalignment between the
In 2007, famed psychologist Howard Gardner was interviewed by Fryer (2007) to discuss this topic in detail. As is common knowledge, to say that trust between corporations and the public is feigning would be an understatement with unethical behaviors being perceived as the status quo thanks to the calamity of scandal plaguing Corporate America. Howard Gardner feels that with the pressure for employees and management to succeed at all costs in today’s ultra-competitive market-place, it can be easy to lose one’s way if they do not hold what he calls the ethical mind, helping people to make morally sound choices especially in work involving entities, colleagues and society as a whole (Fryer, 2007). This also serves as the author’s definition of ethics: To make morally sound choices regardless of influence of pressures or consequence even at the risk of forced resignation or involuntary termination (Fryer,
In order to define ethical leadership I think that one must first define the words ethical and leadership. By doing so it not only makes it possible to define what ethical leadership is, but it helps in shaping your own idea of what it means.
Tragash, H. (2006, June). Rebuilding Trust. Leadership Excellence, 23(6), 17-18. Retrieved April 19, 2009, from Business Source Premier database.
Up until this point, much of the focus has been centered on defining effective leadership from characteristics and traits that have been identified through research and behavioral science, but what do the followers have to say about the leader’s characteristics and traits? Furthermore, what makes someone want to follow a leader? Thus, there are five specific traits or characteristics a leader must display before being followed, and the first characteristic or trait is honesty (Shead, 2016). While people desire to follow an honest leader, honesty is the key trait that allows the leader to influence others besides power; however, leaders have very few opportunities to demonstrate honesty, especially in large organizations (Shead, 2016). Therefore,
Trust and shared vision unify the facets of interpersonal resources leaders, direct or guide as employees, navigate through the structured network of relationships that encompasses the cooperative relationship of shared vision, shared values, and mutual goals (Frisina & Frisina, 2011; Li, 2005; McLeod & Young, 2005; Rodríguez-Campos, 2007). Faithfulness and dependability of purpose, move the organization forward from an expected ideal state or big picture whereas the behavior of the leadership becomes the forecaster of organizational performance (Frisina & Frisina, 2011; McLeod & Young, 2005; Rodríguez-Campos, 2007). Reemphasizing Frisina and Frisina (2011) quote, “Whenever performance does not match potential, there is a gap between how we are actually performing and what we could be achieving with the appropriate level of influential leadership and personal motivation” (p. 27).
Studies show that gaining the trust of a group of individuals is critical to become an effective leader. It is the foundation that forms the team. “Developing a leadership style that produces trust is the ultimate root and source of influencing another” (Gaiter, 2013 p. 324). This rings true in any leadership role. Any coach, pastor, or department manager needs to understand that building trust takes time and effective leadership is a time consuming task. Leaders are always being watched by their teams and leaders must always act with integrity and honesty while trying to better the team he or she leads (Gaiter, 2013). Once trust has been built between leadership and their peers, productivity, team cooperation and morale have been shown to increase dramatically.
Leaders often talk about trust, rather than building trust. Trust is something that must be earned. Leaders of well-respected, high-performing organizations have long known the value of building and sustaining trust.
The responsibilities of the servant leaders go beyond organizational goals and development of subordinates, responsibilities extend into all stakeholders, internal and external, towards the corporate and societal community (Peterson et al., 2012). The qualities reach into ethical and moral values of the CEO as a person and their reflection of the corporate entity (García-Sánchez et al., 2013). The movement between ethical and moral decisions transcend level of consciousness reflective of organizational and personal experiences; CEOs operate at lower levels of consciousness when engaging in decision involving self-fulfillment (Young, 2002). Therefore, one quality is for a CEO involves the development of a much wider and expanding view that moves away from any self-views on the spectrum of consciousness (Young, 2002). This is a difficult position for narcissistic leaders.
One vital element to fruitful relationships and positive organizational outcomes is establishing trust. Pech & Slade (2006) studied Xerox in 2000 while they experienced financial difficulties, and the company was in trouble. Employees were jettisoning at a rapid rate that caused irritation and disengagement for those who endured. Xerox determined a change of leadership was required and announced Anne Mulcahy as Chief Executive Officer. Mulcahy revised her leadership team to one who shared her visions, goals, and beliefs that employees needed a leader they could follow. She relinquished a portion of her power, developed a supportive environment, and solicited employee’s opinions. Mulcahy earned and restored the trust in management, and Xerox benefitted by attaining its organizational goals. The employees’ perception of the leadership culture shifted because of significant organizational
Ethical leadership is of great significance to the prosperity of an organization. Ethical leaders usually motivate their employees to work hard. In that regard, ethical leadership requires a cocktail of ethical values ranging from rationality to independent and critical thinking. Most organizations nowadays have ethical leaders responsible for the good relationship among the members. Ethical leaders are usually more concerned about the welfare of other people rather than other motives. My focus on ethical leaders will be on corporate leaders, specifically chief executive officers. My leader of choice is Mike Duke, the chief executive officer of Wal-Mart retailers, which is one of the largest retailers in the United States. For its prosperity,
23) is an example of how they help to foster trust the same way a leader fosters trust. A leader or school will teach the followers ethics and hold them to that ethical behavior. A good leader cultivates their people; a good school does this as well with their students. Cultivating ethics in people has pitfalls. Many times we make the mistake of misconstruing Ethics and Compliance. As Stephen Covey points out in his book “The Speed of Trust”- “The problem in organizations, however, is that many “ethics” solutions focus on compliance. The compliance definition of “ethics” is not one of integrity or integratedness; it is a watered-down, devalued definition that essentially means “follow the rules” (Covey, 2006, p. 61). Great leaders however, make sure their people know the difference between ethics and compliance. Aldo Leopold said it best when he said “Ethical behavior is doing the right thing when no one else is watching- even when doing the wrong thing is legal.’ (Goodreads, 2016) This is what separates ethics from compliance, doing the right thing when only you know that it is the right thing to do. Another part of being ethical is character. Character as defined by Dr. Henry Cloud is “the ability to meet the demands of reality” (Cloud, 2006, p. 24). This is how you act in real life. Character and integrity come together to form ethical behavior. At some point everyone has had a leader
Jessica Waggoner (2010) stated in her thesis, there are three requirements of leaders allowing them to capitalize on their ability to influence ethical conduct. These three requirements are “achieve an understanding of ethics; serve as a role model in making ethical decisions; and develop and implement a plan of action for promoting ethical conduct on the part of his or her staff” (Waggoner, 2010). This paper attempts to define ethics and leadership and how they combine to create ethical leadership. It will explore the traits of an ethical and unethical leader as well as what influences or contributes to unethical behavior. It also discusses how employees, leadership, and the environment can lead to or contribute to unethical behavior.
Caldwell, C., & Dixon, R. D. (2010). Love, Forgiveness, and Trust: Critical Values of the Modern Leader. Journal of Business Ethics, 91-101.
Q1) Morals are the code of conduct for an individual, while values are the ideologies that determine the specific personality trait of an individual. Now, moral leadership is different from other forms of leadership. Moral leaders aim to serve. Considering my morals and values, I believe that I am an empath. An empath is a person who can very quickly relate or feel the issues and problems faced by other people. Justice is a core moral factor present in me. Moral leaders tend to develop capabilities among their subordinates and other employees or team members. In such a scenario, empath are the best suitable person. The reason is they are able to relate with problems quickly which makes it easy to guide the person in trouble