Professional Documents
Culture Documents
Submitted By:
Group No-3
Aditya Goyal – 411
Amit Gupta – 430
Apoorv Sharma – 431
Rahul Raina – 503
Nishant Rathee - 509
Contents
Abstract ............................................................................................................................................... 2
Introduction ........................................................................................................................................ 2
Review of Literature ......................................................................................................................... 2
1. Ethical Leadership in Different Environments ............................................................................................. 2
2. The personal integrity of the person ................................................................................................................ 2
3. Power to influence or cultivate integrity among his followers .............................................................. 3
4. Leader employee relationship ............................................................................................................................ 3
5. Ethics of an Organization ...................................................................................................................................... 3
5.1 Individual Factors ................................................................................................................................................................. 3
5.1.1. Machiavellianism .............................................................................................................................................................. 3
5.1.2. Locus of Control ................................................................................................................................................................ 3
5.1.3. Value Orientation ............................................................................................................................................................. 3
5.2 Organizational Factors ........................................................................................................................................ 4
5.2.1. Code of Ethics ..................................................................................................................................................................... 4
5.2.2. Ethics Training .................................................................................................................................................................. 4
5.2.3. Rewarding System ........................................................................................................................................................... 4
5.3. External Factors .................................................................................................................................................... 4
5.3.1. Competition ........................................................................................................................................................................ 4
6. Impact of Ethical Leadership on Employee Job Performance ................................................................. 4
7. Ethical leadership in the organization ............................................................................................................. 5
Introduction
Interest in the ethics of an organizational structure is increasing since last. Companies have shown their will and
commitment to fight growing corruption, Governments have an ethical code of conduct on their agendas, Integrity
of an organization when at stake can lead to the disruption of its image and can be the reason for its downfall. It
is the managers of an organization who are given the role of providing ethical leadership to safeguard moral
values. It is their leadership, which influences the employees directly and set the norms of appropriate conduct,
which becomes the part of the organizational culture. Without ethical leadership, a company cannot even survive
in today environment, Over the years many theories have been developed regarding ethical leadership with an
objective to see how much these normative views of leadership fits the point of view of those who are directly
involved. Every person in an organization is responsible for ethical behaviour. Many initiatives aimed at
increasing organizational ethical behaviour are focused on the leaders. Ethical top leadership not only influences
the followers in an organization but also across organizational levels. Leaders expect the low-level leaders to
follow ethical leadership guidelines laid by the organization. Leaders who treat their followers/subordinates with
fairness, especially by providing honest, frequent and accurate information are seen to be more effective. Humility
help followers to understand the growth process for their own development. Thus, it is good if the leader is
humble. People generally bring problems to the notice of the leader if the leader is ethical. Also, as per the research,
ethical leadership helps to overcome interpersonal conflicts. If the top management is ethical, then the people
below them also tend to follow the same footsteps leading to the healthy work environment. The leader should
not abuse the use of their power for wrongdoing. In today’s world, organizations have started ethical leadership
programs for the employees to teach them cultural values especially for the employees dealing with foreign clients.
A leader must be able to influence others to follow their standards. A leader can build on the foundation of trust
their character, enhance a sense of unity and create buy-in from followers. Ethical leader’s statements whether
positive or negative can be equally effective if they deliver clear, moral, inclusive, goal setting statements with
persuasiveness.
Review of Literature
1. Ethical Leadership in Different Environments
Most studies on ethical leadership seem to implicitly assume that a ‘one size fits all’ solution is adequate for
organizations operating in different environments. The extent to which contemporary conceptions of ethical
leadership are readily applicable to a more diverse range of organizations or whether there are in fact different
ways in which ethical leadership may be exerted. Is there one best way to be an ethical leader? Or do managers
(need to) adjust their ethical leadership styles to the particular characteristics of the societal and organizational
contexts in which they operate?
Several studies suggest that it is indeed necessary to expand the scope of ethical leadership research to a broader
range of organizations and take account of the contextual differences that may occur manifestations of ethical
leadership. Research shows that some components of ethical leadership like power sharing fit better with the
values of non-profit organizations likewise some others Show that not all aspects of the ‘moral manager’
component of ethical leadership (i.e., role modelling, reinforcement) can be supported in the police setting.
Additionally, studies indicate that the various aspects of ethical leadership differ in their respective effects on
follower behaviour.
More specifically the concept of ethical leadership rests on the following components:
5. Ethics of an Organization
After reviewing the available literature on ethical behaviour, studies can be categorized into individual factors,
organizational factors and external factors.
5.1 Individual Factors
5.1.1. Machiavellianism
High Machiavellianism tends to be less ethical in their decision making than low Machiavellianism.
Reference: Hegarty and Sims (1978, 1979)
5.1.2. Locus of Control
It refers that the individual believes they can control events affecting them. Two kinds of locus of control are
there- internal and external. Internals believe that they can themselves control their decisions; externals believe
that decisions are controlled by an environmental factor that they cannot control.
Reference: Internals are less likely to engage in unethical behaviour. Shapeero et al. (2003)
5.1.3. Value Orientation
Value-oriented individuals are less likely to engage in the unethical behaviour.
Reference: Beams et al. 2003
5.2 Organizational Factors
Organizational factors are the factors that are external to the individual and exist in the work environment of the
individual and directly or indirectly influence the individual in their ethical behaviour. There are many constructs
of the organizational factors that are important like a code of ethics, ethics training, rewarding system, climate,
structure etc.
5.2.1. Code of Ethics
Most of the review concluded that the code of ethics influenced ethical behaviour. In an organization, there is
large no. of studies available on the code of ethics. The relationship of the code of ethics and ethical behaviour
provides a miscellaneous result. In 1977, Weaver and Ferrell found the existence of a code of conduct and
enforcement improves ethical behaviour but Ferrell and Weaver (1998) argues that existence and enforcement of
the code of ethics have no relation with ethical conduct.
5.2.2. Ethics Training
Merely the existence of the code of ethics not only influences ethical behaviour but knowledge of its content
among employees has a positive influence on employee’s ethical behaviour. A training programme should
positively influence ethical behaviour; ethics training enhance ethical behaviour in an organization. Ethics training
introduces the organization policies rules, codes and teaches how to deal with this job to behave ethically.
5.2.3. Rewarding System
Rewards are the one of the most important in ethical behaviour. A relationship between rewarding unethical
behaviour and the continuation of such behaviour was revealed in most studies. The rewards system for ethical
behaviour increases ethical behaviour & rewards for unethical behaviour increases the frequency of the unethical
behaviour. Individuals in a high incentive condition were more likely to engage in unethical behaviour.
5.3. External Factors
External factors are external to the individual organization that cannot be controlled by the organization and which
influence directly or indirectly the organization.
5.3.1. Competition
Competition in the market brings greater pressure to the organization found that competitiveness tends to decrease
ethical behaviours (Hegarty and Sims (1978)). Verbeek, W., outwekerk, C., and Peelen, E, (1996) does not support
previous studies and found competition in the market have a significant impact on personality trait in 2003.
Christies et al. find external environment influence positively on the business practices.
If leaders, executives, and managers adhered to the six pillars of day-to-day decision-making, an ethical
environment might likely be created, and in turn, employees might follow.
Once an ethical environment is created, employees and management develop trust in one another. Good leaders
garner trust. Trust can be developed in many ways but most fundamentally through leading by example.
The four-component process of an ethical decision-making process to explain what is required in order for
followers to behave ethically. This process includes:
➢ Ethical sensitivity to interpret a situation.
➢ Ethical reasoning to figure out what to do.
➢ Ethical motivation to decide what to do.
➢ Ability to see.
Research Methodology
The research study conducted aims to gain insight into how individuals conceive the ethical nature of leadership
and ethical decision making as a leader. To this end, a Google form was floated among various friends and
relatives who are employees in various organisations or are entrepreneurs. Qualitative research is more sensitive
and is more suited for studying the diverse and different people have of the ethical nature of leadership and ethical
decision making as a leader.
Before beginning with the research a thorough analysis was done of the earlier available 10 types of research
conducted, various case studies and other theories present relating to Ethical Leadership.
Given the results of earlier researches, a theoretically driven questionnaire was generated keeping in mind the
types of employment an individual can have to maximize the possible variance of different views. Thus, variability
was ensured in the study to increase the chances for consistent and concrete results.
➢ 6 questions were focused to know about the general information of the individual filling out the questionnaire.
➢ 12 questions were focused to get the information about the personal ethical leadership traits of the individual
filling the form. The answer to these questions can be provided with the given 4 choices that were as follows:
a. Never
b. Sometimes
c. Usually
d. Always
➢ 12 questions were focused to get the information about the organisational ethical leadership practised that
is followed in their respective organisations. The answer to these questions can be provided with the given
5 choices which were as follows:
a. No work-experience
b. Never
c. Sometimes
d. Usually
e. Always
➢ 1 question was focused to get the information about the quality that one sees in a leader as the most
prominent one and the options available were as follows:
a. Respect others
b. Honesty
c. Focus on team building
d. Value-driven decision making
e. Encourages initiative
f. Leadership by example
g. No tolerance for ethical violations
➢ Other 3 questions were about the “importance of relationship building” “Ability to influence followers” and
reinforcing the + behaviour
We constructed questions on five types of tactics, on the basis of our readings of the previous papers. These are:
• Ingratiation
• Self-floating
• Detailing
• Matching
• Solicitation
Information provided by the respondents was analysed with the help of Excel and Google Analytics.
The results extracted were represented in the form of pie charts and tables.
Recommendations were also made for the ethical nature of leadership and ethical decision making as a leader.
Organizational Ethics
80
70
60
50
40
30
20
10
0
Are ethical behaviours Do the leaders in your Are the leaders in your
rewarded? organization act ethically? organization honest?
As per the survey, most of the organization rewards the ethical behaviour of its people and appreciates them as
well. People also believe that their behaviour is recognized at times only since they are not in communication with
the higher management all the time.
As per the survey, 121 out of 180 people said that the leaders in their organization act ethically. Leaders feel that
being ethical and close to their team helps them grow as well since his/her team members are also following
his/her footsteps and adding value to the organization as a whole.
Since the leadership style is changing, there are 106 people who have voted for their leaders being honest. This
shows that the leaders are sharing proper information and guiding its members in the right direction so that they
can grow in their career.
Organizational Ethics
120
100
80
60
40
20
0
Does your organization Does your company require Are ethical behaviours
have a written ethics its employees to sign a code expected out of your
policy? of conduct statement? leaders?
More than 50% of people surveyed said that their organization has a written ethics policy.79 out of them said
responded that their company require them to sign a code of conduct statement. This analysis also shows that
ethical behaviour policies have been laid down by the organization as laid down by the government. The policy
document has been made mandatory for every new employee to be signed and duly filled by them so that in case
of any misconduct, proper actions can be taken against them.
Major proportions of the people have voted that they expect ethical behaviour from their leaders.
Organizational Ethics
80
70
60
50
40
30
20
10
0
Is the behaviour of your Do the leaders in your Does your organization
leaders consistent with the organization employ offer training in business
stated ethics and values of favoritism? ethics?
the organization?
As per the survey, 109 out of 180 people believe that their leader show consistency in their ethical behaviour and
very few have voted for them not showing consistency. Leaders follow ethics and values laid down by the
organization.
Only 38 out of 180 people surveyed said that the leaders in their organization act ethically and only 34 out of them
said that their organization leaders are always honest. This shows the lack of ethical behaviour in leaders.
A little less than 50% people surveyed said that the leaders in their organization employ favouritism.
Personal Ethics
120
100
80
60
40
20
0
Do you maintain Do you say “no” to Do you show respect for
appropriate inappropriate requests? copyright laws?
confidentiality?
The survey indicates that almost all of the people maintain appropriate confidentiality and almost always say “no”
to inappropriate requests. Majority of them also shows respect for copyright laws.
Personal Ethics
120
100
80
60
40
20
0
Are you honest when Do you balance Are you able to avoid
sharing information with organizational and conflicts of interest?
others? personal needs?
Never Sometimes Usually Always
As per the survey, 161 out of 180 people are honest when it comes to sharing information. As the ethics of an
individual play an important role, this shows that people are ethically responsible in sharing information with
others.
As per the survey, 153 out of 180 people balance their organizational and personal needs. Nowadays organizations
also promote their employees to have a balanced personal life and therefore this survey shows that organizations
are also helping their employees with their personal needs.
As per the survey, 141 out of 180 people are able to avoid conflicts of interest within their organization.
Personal Ethics
140
120
100
80
60
40
20
0
Are you able to manage Do you respect the Do you utilize your
your personal biases? diversity within your authority properly?
organization?
The survey indicates that 145 out of 180 people are not always able to manage their personal biases. Leaders tend
to favour people whom they like or have more conversation with.
Most of the people respect diversity within the organization. Around 160 people have voted that they
maintain/utilize proper authority at the workplace.
Personal Ethics
100
90
80
70
60
50
40
30
20
10
0
Do you challenge yourself Does favouritism ever Do you follow orders
to “do the right thing”? enter into your decision regardless if they appear
making? unethical?
As per the survey, 166 people keep on motivating themselves to do the right thing. As per our understanding, it
shows that people are not willingly doing the right thing since they are challenging themselves to do it.
There has been no favouritism in decision making.
Most of the people do not follow unethical orders. People in the organization follow ethical behaviour at the
workplace.
Level Of Management
19% 22%
Low
Mid
24%
35% Top
No Work Ex
Out of the sample surveyed most of the people belonged to the mid-level management category followed by top-
level management.
23%
Yes
57%
20% No
Maybe
The survey indicates that most of the people would not compromise ethics to meet success i.e. out of 180 people
57% (103) would not compromise ethics to meet success.
Qualities Preferred In A Leader
RESPECT OTHERS 144
HONESTY 135
As per our review of the literature, we came up with few qualities on which the leaders are assessed in an
organization. As per the survey conducted, more than 50% of the people have voted for all the qualities mentioned
in our survey question regarding the qualities they see in their leaders.
Highest priority has been given to “Respect Others”, followed by “Honesty”, “Focus on Teambuilding”,
“Encourages Initiative” and “Value-driven decision making”. Apart from these, some other qualities that people
see in their leaders in the organization are “Trust” and “Commitment” towards work.
Leaders need to develop similar qualities in their followers as well and develop ethical leadership in them also.
Most stats indicated that organizational ethics is an important yet complicated issue for them. Whether it is to
guide followers when they face ethical dilemmas or whether it is to enforce the moral values and norms of the
organization as they are laid down in its rules and procedures, ethical leadership is widely acknowledged as being
of great significance.
Ethical leadership is dependent on the characteristics and traits that ethical leaders should possess. Firstly, make
ethical decisions and behave accordingly. It is seen that moral person is indeed seen as the key prerequisite to
ethical leadership.
Ethical leadership is associated with variety of traits like integrity, honesty, trustworthiness, reliability are
among the long list of characteristics that managers mentioned as necessary attributes required in a moral
person. Ethical leaders are respectful, caring, empathic, open, responsive and approachable. They should respect
the view points of others and do not judge people and be able to relate themselves with the problems of their
followers, how they think, feel and act. Leaders are people oriented and lead to the development of the team.
Ethical leaders are courageous in standing up for what they believe in and defend their values and norms in the
face of difficult external circumstances and against all odds.
While having the traits of a moral person is an essential aspect of being an ethical leader, in the end, ethical
leadership traits are considered most apparent in and inferred from the leaders’ subsequent decision-making and
behaviour.
It also means being able to make tough decisions when needed and being honest and straightforward, for instance
when a person is not functioning well.
While there seems to be a fairly broad consensus on many of the personal traits and behaviours that ethical leaders
should adhere to, interviewees differ in their views on the extent to which one should actively and consciously
practice or exert ethical leadership to try to influence the ethical decision-making and behaviour of followers.
Some note that being a moral person is a necessary but not a sufficient component of ethical leadership and that
ethics and integrity should be managed. Conversely, there are also a few interviewees who feel that leaders should
not make ethics too much of an explicit part of their daily leadership and interesting differences in how managers
conceive ethical leadership in general, and the ‘moral manager’ in particular.
Ethical leadership is dependent on applying right behaviour. Leaders act as role models for their followers. Role
modelling is considered essential to ethical leadership because it attests to the credibility of leaders and strengthens
–or weakens- the message that the leader aims to send; it is taken as a means by which leaders communicate the
underlying principles that they and the organization maintain.
Given the strong influence that role modelling is posited to have, a number of interviewees indicated that it often
requires a conscious and explicit effort on the part of the leader. Others, however, consider an ethical leader’s role
modelling to be a more natural and implicit process that comes from within the leader and is done rather
subconsciously because the behaviour of a leader is seen as representative of basic underlying principles, being
an ethical role model is not merely about big gestures and large sacrifices nor is it solely about how a person acts
in the face of a clear ethical dilemma.
2.2. Reinforcement
Compared to role-modelling behaviour and communicative strategies, reinforcement was far less prominent in
managers’ discussions of ethical leadership.
The data suggest reinforcement is not used as a primary means for ethical leadership but is only meant to, as the
term itself suggests, reinforce other main components such as role modelling and communication. Yet
interviewees do consider reinforcement to be a necessary requirement for ethical leadership.
Interviewees argued that ethical leaders should create and maintain an environment in which others feel
comfortable and safe enough to report violations. Ethical leaders make sure that people know and feel that when
they have made a mistake or witnessed or heard something that could be considered a violation of organizational
norms and values, that they are not penalized for coming forward with it.
The study talks about leaders following the path they teach to their followers themselves as they behave as role
model for them. So they actions performed by the leaders are noticed and applied by the subordinates as well. So
it is important to know how the leader behaves in the team especially by his/her means of communication with
the team. Data is one important aspect that may make a difference. As if the leader does not give proper
information to the team, then they will work accordingly leading to work that is not desired from them. So sharing
of proper info by the manager is very important so that they are on the right path and can perform with the best of
their abilities.
It is important for the leader to resolve the problems of his/her team. Not only professionally but also personal
problems must be addressed, as it tends to affect the performance of the person and in turn affect the time lines of
the project.
As per the chain of command in the organization, there might be situations where the seniors try to make us do
work that is not ethical or required. But it needs to be done for the work to be completed. But the leaders must
teach ethical means to their followers and not promote any such thing so that they also never indulge in unethical
means that can later harm the organization or the person individually.
➢ Ethical Leadership
By Jane A. Van Buren, Noonmark Nonprofit Services