Ethical Leadership - The experience of JCU's 3rd IBD cohort

Chapter 6 - Normative Leadership Theories

Normative Leadership Theories

            - Tell leaders how they should act

     - Built on moral principles or norms but unlike general ethical perspectives, they are specifically address leader behavior

- Prior to 1940’s researchers believed leaders were born, not made

            - Couldn’t find common characteristics

- Next assumed to be effective, leaders had to adapt to the elements of the situation

            - New people need more direction than experienced people

-Learned not inherited

Transformational Leadership

·        Begain in 1978 with the book titled Leadership by James McGregor Burns

·        Traditional leadership called “transactional” compared to a more powerful form of leadership called “transforming”

·        Transactional- lower level needs of followers (food, shelter, acceptance), focus on terminal values such as liberty, equality and justice. ACTIVE:“contingent reward” and “management by exception”. They provide rewards and recognition contingent on followers carrying out their roles/reaching objectives, discipline followers when they fall short. PASSIVE: “Passive-avoidant” or “laissez-faire” leaders wait for problems to arise before taking action, avoid taking action, fail to provide goals/standards or clarify expectations.

·        Transforming- higher level needs (esteem, competency, self-fulfillment, self-actualization), focus on instrumental values such as liberty, equality  and justice. “Idealized Influence”- transformational leaders become role models for followers who admire, respect and trust them.”Inspirational motivation” transforming leaders arouse team spirit, are enthusiastic and optimistic. “Intellectual stimulation” encouraging followers, stimulating innovation and creativity. “Individual Consideration” act as coaches or mentors who foster personal development.

·        Burns believed leaders display transactional or transformational. Bass believed that the transformational leader uses the active elements of the transactional approach (contingent reward and management by exception) along with idealized influence, inspirational motivation, intellectual stimulation and individualized consideration.

·        Transformational leaders are more successful than transactional and their organizations achieve extraordinary results.

·        Transforming leaders (authentic) is a moral leader because the ultimate product is higher ethical standards and performance because of they act as a role model, provide intellectual stimulation and are passionate about a cause. Ex: MLK .Psuedotransformational-self-centered, manipulate followers ot reach their own personal goals. Envy, greed, anger, deception are characteristic. Ex: Hitler

·        Authentic transforming leaders don’t impose ethical norms but allow followers free choice


Two problems with these theories

1) Hard to apply; not easy to decide what leadership style to use

2) Contingency theories give too much weight to contextual factors

Nine charismatic and transformational attributes:

1) Motive arouser

2) Foresight

3) Encouraging

4) Communicate

5) Trustworthy

6) Dynamic

7) Positive

8) Confidence Builder

9) Motivational

* Transformational leaders raise the level of morality in a group or organization

- demonstrate higher levels of moral reasoning

- Effective in a variety of cultures

- Some researchers are more concerned with the story of success or turning around a company over ethical issues

* All leaders suffer from uneven character development

            - Not a perfect mix of virtues and vices

* Critics of transformational leadership argue stakeholders are just more important if not more than a group as leaders to the success of an organization


Servant Leadership: Put the Needs of Followers First

Servant Leadership:

·        Concerns of followers first

Four related concepts are central to servant leadership

·        Stewardship- accountability for results through collaboration and persuasion rather than coercion and control, acting on behalf of others

·        Obligation- servant leaders take their obligations and responsibilities seriously

·        Partnership- view followers as partners not subordinates. Concern for equlity, distribution of rewards. Use coaching.

·        Elevating purpose- serve worthy missions, ideas, and causes. Seeks to fulfill a higher moral purpose:

Altruism: concern for others before self

Self awareness: listen to themselves and others while reflecting and recognizing the importance of spiritual resources

Moral sensitivity: realize the importance of ethical decisions

Weaknesses of servent leadership

- Many are skeptic because it sounds good in theory but not practical

- Misplaced goals: following one goal that may turn out to have a different result

- Some people feel the word servant isn’t political correct and shouldn’t be used



Authentic Leadership: Know Yourself & To Your Own Self Be True

·        Acknowledge the ethical responsibilities of their roles, can recognize and evaluate ethical issues and take moral actions grounded in their beliefs and values.

·        Authenticity can be fostered: 1. Encouraging people to think about the consequences of their leadership decisions, 2. Enhancing their perspective taking trhough discussion and training, 3. Exposing them to common moral dilemmas to help them recognize the ethical issues they will face in their job, 4.building their belief in their ability to follow through on choices, 5. Helping them develop strategies for adapting and coping with new ethical challenges, 6. Pairing them with moral leaders so they can observe authentic behavior first hand

·        Authentic leaders engender more trust and drive higher organizational productivity and performance.

·        Promote positive leadership behavior that makes fundamental difference, help leaders become more authentic


Four components:

1) Awareness: Being conscious and trusting motives, desires, feelings, and self concept

- know others strengths and weaknesses

2) Unbiased (balanced) processing: objective with internal or external sources

- Instead of denying, distorting, or ignoring feedback

3) Action: harmony with what is believed and not changing to please others

4) Relational Orientation: seeks openness and truthfulness in close relationships- letting others see the good and bad aspects of who we really are.

* Ethical leaders create ethical followers

            - set high standards

* Are more predictable so followers waste less time determining what the leader will do next

* More willing to trust creating a productive environment

* Creates positive emotions building self efficacy


- Starts with strong moral emphasis

- Worthy objectives towards positive leadership

- Want to be effective while being authentic

Try to promote the followers into the organization


- Still a new concept

- Doesn’t have a lot of supportive research

- Difficult to distinguish between other two styles: transformational and servant

- Could be additional reasons people want to be moral


Taoism: Lead Nature’s Way


·        Ethical framework for such important trends or themes in leadership such as empowerment, innovation, teamwork, spirituality and collaboration.

·        Taoist philosophy seems suited to leaders in fast-paced, rapidly changing, decentralized work environments.

·        Flexible, use “soft tactics” facilitate teamwork

·        Encourage embracing silence, inner peace, serve, develop character

·        Look to nature for insight about leadership, natural world renews itself when left alone.

·        Weaknesses: we shouldn’t abandon logic, laws can change society for the better, reasonable rules, professional guidelines, codes of conduct do improve ethical climate.

- One of the world’s oldest philosophies

* Creates harmony with person and nature mainly from five images
* Rely on or metaphors drawn from nature and daily life to illustrate the characteristics of model leaders:

·        Un-carved block: Hands-off approach, low-profile leadership, avoid wealth, leave followers alone

·        Child: Wise leaders don’t get caught up in the pursuit of power and privilege but remain humble

·        Water: there is great strength in weakness. Water cuts through the hardest rock given enough time. Leaders who use soft tactics (listening, empowering, collaborating) rather than hard ones (threats, force) are more likely to overcome resistance to change. Flexibility, Pliability.

·        Valley: forces in balance, yin and yang. Leaders should focus on yin: negative,dark, cool, female, shadows. (Rather than yang: positive, bright, warm, male, sun)

·        Clay pot- celebrates emptiness by elevating nothing to higher status than something. Put aside empty words, superficial thinking, technology, selfishness.

Case Study 1 - The Airline Executive as “Mom Chief”

Southwest Airlines executive Colleen Barrett- demonstration that power comes from self awareness and honest self understanding and living your strengths and values.


Colleen Barrett has been with Southwest Airlines from the beginning starting as the attorney for the entrepreneur. The customers and employees have been at the forefront of the company’s business decisions. While keeping employees and customers happy, Southwest has been able to produce a profit every year. Even after 9/11 Southwest never laid off employees and paid them for the time planes were grounded. Colleen was the CEO and president for a few years then stepping down to focus specifically on customer service. The employees feel like a family calling Colleen “Mom”.

Case Study 2 – Transforming Clear Lake College

The college was down in enrolled would threaten the ability to pay bills. The president couldn’t take on the responsibility and resigned. Sam Thomas was a marketing business man hired as the new president. He took extreme measures to make the college profitable by freezing salaries and benefits while making these decisions on his own. Many of decisions were done without consulting others involved with financials. The marketing efforts he put in place paid off with enrollment increasing by 1,400 students. However, Sam’s leadership style was not always in the best interest of all parties involved. Many lay=offs were done without any prior knowledge. Faculty didn’t usually last longer than a year because they couldn’t stand how Sam ran this “business”.

Case Study 3 – Betraying the Student Borrower

Betraying the Student Borrower- Unethical practices in the student loan industry by colleges. In each case the college and officials put their needs/institutional needs above the needs of the students. Students then mistrust their alma mater. Students and parents borrowing money for college tuition are usually under the assumption the financial aid offices of the universities have the students’ best interest in mind. A New York attorney blew this case wide open showing universities had closed door agreements with certain leaders to receive kick backs. This provides the students with bad advice plus adding to the cost for many individuals to attend college. Once this was brought to light many of the universities had to pay fines for the unethical behavior and in some cases pay back the students because of the inflated loan prices. When this case hit the national news it hurt the reputation for the universities with current students, alumni, and the general public. People will think twice before applying or sending their children to these universities.