13 Ethical Leadership

While leadership is a highly researched organizational phenomenon, ethical leadership has been primarily investigated through philosophical and normative perspectives (Benevene, Dal Corso, De Carlo, Falco, Carluccio, & Vecina, 2018). Toor and Ofori (2009) claim that “empirical research on ethical leadership is scarce. Scholars have mostly discussed ethical leadership in theoretical and conceptual terms, but there are hardly any studies providing empirical evidence about ethical leadership” (p. 534). The seminal work of Brown, Treviño, and Harrison (2005) examined ethical leadership from a descriptive lens, expanding the domain from the traditional philosophical perspective (p. 117). Benevene et al. (2018) note that “…unlike the philosophical approach, which defines [ethical leadership] from a normative approach (that is describing ‘What an [ethical leader] must do’),” the definition of ethical leadership proposed by Brown et al. “…adopts a descriptive approach, aimed at identifying behaviors, antecedents, and consequences of [ethical leadership]” (para. 17). Examining ethical leadership from a descriptive lens, according to Brown et al. (2005), offers a better understanding of “…what characterizes ethical leadership, and how the [construct] relates to other variables in its nomological network” (p. 117). Expanding on the traditional meaning of leadership, Brown et al. (2005) offer a constitutive definition of ethical leadership. Consistent with prior research, the definition of ethical leadership devised by Brown et al. (2005) will be used in this study to research the effects of ethical leadership and culture on employee well-being and job satisfaction. They define ethical leadership (alternatively referred to as moral leadership and ethical management) as “the demonstration of normatively appropriate conduct through personal actions and interpersonal relationships, and the promotion of such conduct to followers through two-way communication, reinforcement, and decision-making” (Brown et al., 2005, p. 120). However, emerging literature has challenged Brown et al.’s conceptualization of ethical leadership, which argues that ethical leadership is a behavioral component that exists on a continuum of leadership styles (Kacmar, Carlson, & Harris, 2013).

The conceptualization of ethical leadership is best described along two related dimensions (Brown et al., 2005; Mayer et al., 2010). The first dimension is the moral person (e.g., integrity, concern for others, justice, trustworthiness), and the second dimension is the moral leader (e.g., communicating, rewarding, punishing, emphasizing ethical standards, role modeling ethical behavior) (Mayer et al., 2010, p. 8). Hansen, Alge, Brown, Jackson, and Dunford (2013) provide a summarization of Brown et al.’s (2005) conceptualization of ethical leadership. They summarize that “as moral persons, ethical leaders are fair, principled, and genuinely concerned for their employees…[and] set, communicate, and reinforce high ethical standards” (Hansen et al., 2013, p. 438). Ethical leadership can improve employee behavior, relationships, and employee and organizational performance (Jambawo, 2018, p. 1000). However, some scholars have suggested that ethical leadership characteristics (e.g., honesty and integrity) are observable across a typology of leadership styles (Toor & Ofori, 2009). Emerging literature supports the conceptualization of ethical leadership as a behavioral component rather than a leadership style.

Despite consideration as a stand-alone construct, ethical leadership falls under the umbrella of positive forms of leadership (Kacmar et al., 2013, p. 582). Under the umbrella of positive leadership styles, Kacmar et al. (2013) include the following leadership styles: authentic, spiritual, and transformational (p. 582). Scholars have proposed ethics is a component of each of the forms of positive leadership; however, the overlapping ethics component suggests that the ethical leadership construct is embedded in different styles and occurs on a continuum (Kacmar et al., 2013, p. 582). Thus, ethical leadership as a component, rather than a style of leadership, creates a contradiction in ethics research.

The Concepts of Unethical Leadership and Unethical Behavior

The antithesis of ethical leadership is a domain of leadership and ethics that is seldom studied. As the reciprocal form of ethical leadership, Brown and Mitchell (2010) define unethical leadership as “behaviors conducted, and decisions made by organizational leaders that are legal and…violate moral standards, and those that impose processes and structures that promote unethical conduct by followers” (p. 588). Discussing the outcomes of unethical leadership, Brown and Mitchell (2010) state that “unethical leader behavior costs U.S. corporations billions of dollars a year due to increased absenteeism, health care costs, lost productivity, and expended costs associated with actionable claims” (pp. 588-589). The adverse outcomes of unethical leadership underscore the urgent need for ethical leadership in the workforce. Employees will benefit from ethical leadership and ethical organizational culture; such constructs have been linked to increased job satisfaction and occupational well-being.

Ethical behavior is a form of behavior that is considered “right” as opposed to “wrong” (Kinicki & Williams, 2016, p. 78). Ethical behavior is often characterized by actions and decisions that are morally sound (e.g., honesty and integrity), whereas unethical behavior usually depicts actions and decisions that are deemed immoral (e.g., manipulation and theft). However, Umphress, Bingham, and Mitchell (2010) highlight a variance of unethical behavior called unethical pro-organizational behavior (UPB), which are unethical behaviors conducted by employees to potentially benefit the organization (p. 769). Unethical pro-organizational behavior is described as “acts that are either illegal or morally unacceptable to the larger community” (Umphress et al., 2010, p. 770). In-between ethical and unethical behavior are variances, suggesting that both behavioral constructs are multidimensional and exist on an ethical behavioral spectrum. Ralston, Egri, Furrer, Kuo, Li, and Wangenheim (2014) assert that “…behavior in organizations may be viewed as ranging from highly ethical to highly unethical, much of the organizational research has focused either on the ethical or the unethical ends of the continuum” (p. 284). To uncover gaps in ethics literature, additional research is needed to create a typology of ethical and unethical behavior.

While ethical leadership and ethical behavior are associated with positive outcomes, unethical leadership and unethical behavior negatively influence employees’ attitudes and psychological well-being (Brown & Mitchell, 2010, p. 598). As reported by Sanders, Wisse, Yperen, and Rus (2018), “…leaders’ unethical behavior is associated with negative outcomes, such as employee workplace deviance, whereas leaders’ ethical behavior is related to positive outcomes, such as increased employee job satisfaction and organizational commitment” (p. 631). Umphress et al. (2010) warn that when a culture is formed, leaders must encourage “…ethical behavior by ensuring that their own behavior corresponds to ethical standards and reward only ethical behavior for their employees” (p. 778). Given the apparent impact of leaders’ behavior, understanding the conditions that shape follower behavior is essential to the promotion of ethical behavior in the workplace.

The questionable practices and violations committed by both Enron and WorldCom reflect poor, moral decision-making and unethical leadership. Corporate executives and leaders who exhibit a lack of ethical behavior violate both fiduciary and social responsibilities. The absence of oversight and a lack of ethical values are not conducive to prosperous societies, thriving businesses, and functional social institutions. While instrumental in minimizing unethical conduct, legislative action is not an end-all solution; corporate leaders must exude ethical leadership and foster an ethical culture with an ethics and compliance program, ultimately creating an “ethical organization” or “ethical climate.” Ethical climate, the moral atmosphere of the work environment, is referred to as “…the institutionalized organizational practices and procedures that define what is considered right or wrong within the organization” (Parboteeah & Kapp, 2008, p. 517). Given the mounting scrutiny placed on the actions and conduct of leaders and managers, organizations can diminish the consequences of immorality and realize the value of ethical leadership and ethical organizational culture, namely an elevation of well-being and satisfaction in the workplace.

Ethical leadership engenders employees to reciprocate fair and honest treatment by leaders and managers in the form of desired attitudes and behaviors (Moon & Jung, 2018, p. 269). Conversely, employees’ perception of unethical behavior could elicit responses of negative attitudes and counterproductive work behaviors toward the managers and organization (Moon & Jung, 2018, p. 269). A leader who offers no ethical direction to employees can invite unethical behavior such as manipulation, dishonesty, and conflicts of interest (Ferrell et al., 2013, p. 31). Bedi et al. (2016) propose that ethical leadership is positively associated with follower psychological well-being because of the critical role leaders play in shaping the work experience of followers (p. 521). Therefore, a leader’s behavior and an organization’s culture both play a significant role in supporting ethical behavior (McShane & Von Glinow, 2013, p. 59). Given the ties between ethical leadership and culture to occupational well-being and job satisfaction, corporate leaders must recognize the value of promoting ethicality and positive ethical behavior in the workplace (Perez, 2018, p. 40).

Through adherence to ethical standards, leaders and managers can role-model the ethical conduct that employees are more likely to follow (McShane & Von Glinow, 2013, p. 54). Bedi et al. (2016) state that “Leaders as role models motivate ethical behavior by demonstrating the type of actions they want to promote and reward” (p. 519). Ethical leaders express their positive characteristics and influence their employees by actively managing and modeling ethical conduct in the workplace (Mayer et al., 2010, p. 8). According to Mayer et al. (2010), “Leaders set the ethical tone for an organization by enacting practices, policies, and procedures that help facilitate the display of ethical behavior and reduce the likelihood of misconduct” (p. 8). Employees are more likely to perceive an ethical organizational environment when ethical leaders signal to employees that doing the right thing is expected, encouraged, and valued (Mayer et al., 2010, p. 8). Through positive role-modeling, interpersonal influence, and disseminating messages about ethical conduct, ethical leaders can develop of an ethical organizational culture, thereby creating an ethical climate that can facilitate the development of ethical employees (Toor & Ofori, 2009, p. 544).

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Effects of Ethical Leadership and Ethical Culture: Relationship to Well-Being and Satisfaction. By Bryd, B. (2019). Content and user contributions on this site are licensed under: CC BY-Attribution with attribution required.

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