The problem to be investigated is the connection between leadership, trustworthiness and ethical stewardship in corporate organizations. This paper will begin with an understanding of the negative impact on any organization in regards to lack of trust between business executives and other employees. This lack of trust has proven to be detrimental to an organization resulting in increased transaction costs, crippling the commitment of the employees and deteriorate the firm’s ability to generate wealth. Caldwell, Hayes, and Long (2010)
The global marketplace has grown to be increasingly competitive and the perception of leadership behavior, trustworthiness and ethical duties can either promote or impair the employee’s commitment to the organization. Organizations in today’s marketplace rely more than ever on their employee’s innovations and initiative in order to gain and maintain a strategic advantage across the globe. It is for this reason that it is critical for leaders of an organization to build the right relationships pertaining to leadership, trustworthiness and ethical stewardship with their employees. ““The ability of leaders to earn the trust of followers is ‘‘the crucial ingredient of organizational effectiveness’’”. Galford and Drapeau (2003b, p. 95)
Leadership is defined by Lussier and Achua (2004, p. 5) is ‘‘the process of influencing leaders and followers to achieve organizational objectives through change.’’ Leadership pertains to the responsibility of knowing what outputs need to be and they develop a relationship with the employees that are focused on the needs of the employees while they achieve the results necessary to generate the desired outputs of the organization. Leadership also is required to prioritize work while managing both financial and human resources in a fashion that is most effective in achieving the organizations objectives. Lastly, leadership is the establishment of a reputation that blends the organization’s beliefs with what they advertise while maintaining the expectations of the organizations customers. These factors of leadership assists with the coordination the actions and goals of one individual with the actions and goals of another. This interactive nature helps us to understand leadership as the process used for "inducing others to coordinate their actions or goals with that of the individual, the leader, to foster the leader's proximate goals. Antelo, Prilipko, and Sheridan-Pereira (2010) Leadership is the ability to guide and influence people and enlist support aid of employees in the accomplishment of organizational goals and objectives. Trustworthiness is an appraisal of the chance of, in the instance of corporations that the leaders can be trusted to respect the duties within the corporate culture as they pertain to the employees. “Trustworthiness is a subjective perception interpreted by each party and is measured on a continuum that assesses the ability, benevolence, and integrity of the party to be trusted” Caldwell, Hayes, and Long (2010). The ability to be trusted is the measurement of a certain set of talents, aptitude, and traits that allow a leader to have influence within the corporate society. Benevolence was defined by Mayer et al. (1995, p. 718) as ‘‘the extent to which a trustee is believed to want to do good to the trustor, aside from an egocentric profit motive. ’’Integrity was defined in terms of ‘‘the trustor’s perception that the trustee adheres to a set of principles that the trustor finds acceptable’’ (Mayer et al., 1995, p. 719). The decision to trust or not to trust is generally based on several factors. These factors are characteristics and statistics of the population and “personal factors that are based on personal history, cultural background, age, gender, and expectations” Caldwell, Hayes, and Long (2010). Every leader knows that trust is an important factor in the effective management of people. However, trust is not just given...
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