Nowadays, ethical leadership is a subject of scientific research, and scholars examine the antecedents and outcomes of ethical and unethical leadership in organizations. Moral leadership is not only about acting morally and being kind to the followers. It is also about being creative and able to encourage people to perform tasks effectively and successfully. Good personal leaders should understand how they create working communities and the codes of conduct, policies, and ethical practices (Markkula Center for Applied Ethics, 2017a). Moreover, ethical leaders should help people see the values and beliefs of their organization and promote ethical behavior and risk management activities. The role of a leader is to set the tone of the organizational climate and manage the ethical or unethical behavior of the followers.
Ethical leadership management depends on the level of moral development of a leader. Leaders with higher levels of moral development can create a more ethical organizational environment, while those with low moral development will promote unethical behaviors at work. Leaders can reward ethical behaviors, punish unethical behaviors, and set high expectations of their followers’ actions. The employees’ desire to report work-related problems to their leader will depend on their ethical or unethical leadership style.
Ethical leadership and organizational culture are essential for a company’s success. In the modern world, leadership ethics focuses on creating a positive corporate culture to stimulate employees to work better and more effectively. Though, it is not always easy to find a necessary approach for every follower. For instance, millennials are interested in promoting and doing good things, but they are also interested in their own life (Markkula Center for Applied Ethics, 2017b). Therefore, a leader must be creative to help such workers fulfill both aims and remain satisfied and happy. A holistic approach to every worker should be used to attain harmonious order and high productivity at work.
However, some leaders are engaged in unethical and even destructive organizational culture. Such leaders purposefully harm the employees and the entire company, thus increasing their self-confidence and attaining their personal gain (TEDx Talks, 2021). Unethical leaders intimidate, bully, and manipulate their followers, creating an unhealthy atmosphere and decreasing working spirit. Research showed that about 40 to 50 percent of workers are victimized by their leaders, and such victimization costs about $25 billion annually for the company (TEDx Talks, 2021). One can see that maintaining ethical culture is of high importance for every successful organization.
Every leader should be able to maintain integrity and compliance in an ethical business environment. To achieve this goal, leaders should become positive role models for their followers. They should be decisive and willing to make important decisions and take responsibility for their choices (London Business Forum, 2011). Moreover, they should be able to eradicate employees’ behavior of relaxing and procrastinating to attain success (London Business Forum, 2011). Still, it is not always easy to find a golden mean and combine the principles of integrity and compliance in an organizational environment.
Compliance- and integrity-based ethics utilizes different principles and policies. A compliance-based approach means that a company “establishes rules and conduct with penalties for disobedience” (Geddes, 2017, p. 424). In comparison, integrity-based ethics programs establish core principles and ask all employees to adhere to these principles and behave accordingly. This approach often involves financial awards for ethical behavior, stimulating people to increase productivity and report problems and misconduct willingly (Geddes, 2017, p. 425). Business leaders must be able to combine both approaches effectively while maintaining the organizational goal of growing profits continuously. The best method to achieve this goal is to lead a business by the example of generating internal ethical values as a leading force. In such a way, followers will trust in their leaders and imitate their behavior, trying to be as successful as their chiefs are. Forming trustful and positive leader-follower relationships is the main secret of success in an ethical organizational environment.
I met different leaders in my life, and I am sure that ethical leadership is much more effective than unethical leadership. Moreover, ethical or destructive leadership can be applied not only in business but also in education or other environments. While being in school, I observed examples of forceful leadership when teachers demonstrated hostile and oppressive behaviors to stimulate students to improve their grades. However, such attempts were ineffective, and the students’ progress and productivity decreased. Similarly, when a business leader harasses or abuses subordinates at work, be it a supermarket or a huge building company, the employees’ desire to work better and be more productive will disappear. I witnessed a situation when the leader of one department of a fast-food restaurant chain violated moral standards, demonstrating hostility and humiliating his subordinates. As a result, the workers refused to perform their work and organized a strike to avenge their leader. Hence, destructive leadership is ineffective and often immoral, so it cannot be associated with a successful ethical organization.
I had also observed the situations when people followed their leaders because they demonstrated ethical conduct and respect for others. At the same time, ethical leadership is not only about ethical behavior and positive relationships with the employees. It is also associated with moral decisions and environmental sustainability. An example of such leadership is the case of Starbucks. In 2007-2008, the United States was experiencing droughts, and every drop of water was valued (Online Master of Business Administration, 2020). However, Starbucks used a great amount of water and produced tons of landfill waste at those times. When the company was criticized for the environmental problems it caused, the reaction of its business leaders was quick and ethical. They designed a new type of machine for their drip stations that significantly reduced the amount of water used for preparing coffee. Moreover, they invented a customer incentive program that stimulated clients to bring reusable cups back to the stores. In such a way, the company preserved its profits and improved its brand image, demonstrating a commitment to the environment and ethical leadership.
Having analyzed ethical and unethical organizational environments, one can conclude that a company’s success depends on a leader’s approach to guide their subordinates. If a business leader wants to maintain integrity and compliance, they will need to demonstrate by their example that internal ethical values guide their behavior and help them attain success. Even though a company has a punishment policy, it should focus on the system of rewards, stimulating workers to increase productivity and creating a healthy working atmosphere. Moreover, ethical organizational culture means being honest in everything, including the relationships with stakeholders and the environment. In conclusion, I believe that ethical leaders always strive for sustainability and harmonious order, and they need to be creative and decisive to succeed with their goals.
Geddes, BH (2017) ‘Integrity or compliance based ethics: Which is better for today’s business?’, Open Journal of Business and Management, vol. 5, no. 3, pp. 420-429.
London Business Forum (2011) Howard Schultz on leadership. Web.
Markkula Center for Applied Ethics (2017a) A model for leadership ethics. Web.
Markkula Center for Applied Ethics (2017b) What is leadership ethics? Web.
Online Master of Business Administration (2020) Ethical leadership case studies. Web.
TEDx Talks (2021) Destructive leadership – The aftermath of the Tempest | Rhonda M. Martin | TEDxSanAntonio. Web.