How Will Ethical Issues Affect Leadership in a Business

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  • Topic: Ethics, Leadership, Business ethics
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  • Published : January 20, 2012
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Contemporary and Pervasive Issues

“How will ethical issues affect leadership in a business?”

Word Count: 5671

In this essay I am going to discuss how ethical issues can affect leadership in a business. In order to answer this question the essay will start by giving a brief introduction into the two topics; leadership and business ethics. I will then aim to successfully link them by considering the argument of whether leaders should concern themselves with ethical issues or whether making as much money as possible should be their main consideration.

Leadership has many different meanings and there have been numerous different classification systems used to define the dimensions of leadership. Infact as Stogdill (1974) pointed out, “there are almost as many different definitions of leadership as there are people who have tried to define it.”

One popular definition used for this subject is that “leadership may be considered as the process (act) of influencing the activities of an organized group in its efforts toward goal setting and goal achievement”(Stogdill, 1974). This definition suggests that it is not a characteristic but is an event that takes place between a leader and his or her followers and that there are three aspects to leadership. Firstly, it involves influence in that leaders induce their followers to behave in a certain way. The second aspect is that leadership occurs in a group context and finally that leadership includes attention to goals, which a leader must direct their followers to achieve.

Over the years there have been many studies and theories formed on leadership. The first, which dominated until the late 1940’s, was the Trait Approach, which focused on leaders and not followers. It assumed that leaders had certain traits, such as intelligence and integrity and that they are born and not made. However, this approach failed to take situations into account and recent research has proven that traits alone cannot account for effectiveness. Following this was the style approach, which focuses on what leaders do and how they act towards subordinates rather than characteristics. This era defines leadership styles as either Autocratic, democratic or laissez faire. However, this approach fails to find which of these leadership styles is most effective in every situation.

Following this was the situational and contingency theories, which assume that different situations demand different types of leadership. However it assumes that people can learn to become effective leaders and does not adequately explain the link between styles and situation. The Situational theory ‘relates four leadership styles; Directing, Coaching, Supporting and delegating to followers readiness for them” (Gill, 2006:48). However, the model assumes both flexibility of style and the ability to diagnose the situation and the style that is needed.

In 1980’s the New Leadership approach was introduced, which compromises visionary, charismatic and transformational leadership theories. “Transformational leadership occurs when leaders raise peoples motivation to act and create a sense of higher purpose” (Gill, 2006:36). Similarly and published around the same time was the theory of Charismatic leadership, who act in unique ways that have specific charismatic effects on their followers. This stage provides a broader view of leadership that augments other models and places a strong emphasis on leaders needs, values and morals. However, “due to the wide range that it covers it lacks conceptual clarity and it is difficult to define the parameters of transformational leadership” (Northouse, 2004:185). Finally, in the late 1990’s Post-charismatic and Post-transformational theories emerged, which focuses on leadership as a community and both leaders and followers working together.

Leadership is a process that is similar to management in many ways and many of the functions of management are included in the definition of...
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