CH 11: Ethical Leadership

Benefits of ethical culture

- Positive impact corporate culture - High employee satisfaction - Strong long-term market firm - decrease gov fines

Ethical Leadership

Ability/authority to guide/direct others toward a goal. Ethical decisions are one dimension of leadership. • Can create an ethical culture. • Power to motivate/enforce norms, policies, and viewpoints. • Influence corporate culture and ethical posture. • Not simply allowing employees to follow their own moral codes. • Assume responsibility to model ethical conduct for employees.

Transactional leaders:

Attempt to create employee satisfaction through negotiating, or "bartering," for desired behaviors or levels of performance.

Apathetic Leader

Cares little for ethics. • Views ethics as relative/optional in a business context. • Often display no passion for firm/mission of the organization. • Employees don't see sacrifices in them that other managers or leaders display.

Integrity based approach

Combine concern for law with emphasis on employee responsibility for ethical conduct Employees instructed to act with integrity and conduct business dealings honestly Can help the firm understand where questionable practices are occurring and where possible new ethical issues are arising.

EQ 4: Transactional leadership strives to raise employees' level of commitment and to foster trust and motivation.

No. Transformational leadership strives to raise employees' level of commitment and to foster trust and motivation. Transactional leaders attempt to create employee satisfaction through negotiating, or "bartering," for desired behaviors or levels of performance.

EQ 1: Ethical leadership is solely the concern of top management.

No. While we often discuss ethical leadership in the context of top managers, all employees should be encouraged to practice ethical leadership.

Normative myopia

Occurs when leaders overlook/stifle important core values in decisions. 1. Believe normative values do not apply to managerial decisions. 2. Facts/values can be separated in decision making. 3. Normative values are outside the realm of business.

Authentic Leader

Passionate about company, live out corporate values daily, form long-term relationships with employees and other stakeholders.

The Radar Model

Recognize Avoid Discover Answer Recover RADAR to describe an ethical leader's duty to recognize ethical issues, avoidmisconduct whenever possible, discover ethical risk areas, answer stakeholder concerns when an ethical issue comes to light, and recover from a misconduct disaster by improving upon weaknesses in the ethics program

Transformational leaders:

Strive to raise employees' level of commitment and foster trust and motivation.

Which type of leader inspires employees to follow a vision, facilitates change, and creates a strongly positive performance climate? This type of leader is considered to be the most effective.

The authoritative leader

leader types

Unethical leader Pathetical leader Ethical leader transactional leader psychopathic leader transformational leader authentic leader

EQ 5: Discovery in the RADAR model involves proactively trying to uncover ethical risk areas that could lead to misconduct.

Yes. Discovery involves proactively trying to uncover ethical risk areas that could lead to misconduct. Ethics audits are a good tool to use in the discovery process.

EQ 2: Ethical conflicts occur when there are two or more positions on a decision that conflict with organizational goals.

Yes. Ethical conflicts occur when there are two or more positions on a decision that conflict with organizational goals.

EQ 3: The four types of communication are interpersonal, small group, nonverbal, and listening.

Yes. The four types of communication an ethical leader should master are interpersonal communication, small group communication, nonverbal communication, and listening.

Unethical Leadership

behaviors and decisions made by leaders that are illegal and/or violate moral standards, and those that impose processes and structures that promote unethical conduct Usually egocentric, Searches for legal loopholes. • Perceive ethics codes, compliance regulations, and industry standards as optional. • Justification for breaking laws: Serves a greater good; risk of getting caught is low.

Ethical leaders generally adopt one of two approaches to leadership: a _________-based approach or a(n) ________-based approach.

compliance and integrity

Ethical leaders need both knowledge and ___________ to make the right decisions.

experience

Ethical leader

• Includes ethics at every operational level. • Addresses issues as soon as they appear. • Tries to create participative organizational cultures. • Views employee collaboration as an important resource.

Psychopathic leader

• Superficial charm. • No conscience. • Grandiose self-worth. • Little/no empathy. • Enjoy flouting rules.