Chapter 5 Values, Ethics, and Character © McGraw-Hill Education. All rights reserved. Authorized only for instructor use in the classroom. No reproduction or further distribution permitted without the prior written consent of McGraw-Hill Education. Chapter Outline • Introduction • Leadership and “doing the right things” • Character-based approaches to leadership • The roles of ethics and values in organizational leadership © McGraw-Hill Education Values, Ethics and Character Leadership cannot just go along to get along… Leadership must meet the moral challenge of the day • Jesse Jackson, American civil rights activist © McGraw-Hill Education Introduction Leaders can use power for good or ill • Leader’s personal values and ethical code may be the most important determinants of how that leader exercises available power sources • Recent scandals involving political, business, and religious figures highlight the need to consider values and ethics in terms of leadership • Scholarly and popular literature have turned greater attention to the question of ethical leadership © McGraw-Hill Education Leadership and “Doing the Right Things”, 1 Leaders face dilemmas that require choices between competing sets of values and priorities • Leaders set a moral example that becomes the model for an entire group or organization • Leaders should internalize a strong set of ethics, which are principles of right conduct or a system of moral values • Gardner and Burns stressed the centrality and importance of the moral dimension of leadership © McGraw-Hill Education Leadership and “Doing the Right Things”, 2 Qualities of leadership that engender trust • • • • Vision Empathy Consistency Integrity McGregor's styles of managerial behavior on the basis of people’s implicit attitudes about human nature • Theory X asserts that most people need extrinsic motivation because they are not naturally motivated to work • Theory Y asserts that most people are intrinsically motivated by their work © McGraw-Hill Education Values, 1 Constructs representing generalized behaviors or states of affairs that are considered by the individual to be important Play a central role in one’s overall psychological makeup and can affect behavior in different situations People in an organization vary in the relative importance they place on values • Instrumental values: Modes of behavior, such as being helpful or being responsible • Terminal values: Desired end states, such as family security or social recognition © McGraw-Hill Education Values, 2 Pervasive influences of broad forces at a particular time tend to create common value systems • May contribute to misunderstandings and tension in the interactions between older leaders and younger followers All generations are molded by distinctive experiences at their critical developmental periods • The Veterans, 1922 to 1943 • The Baby Boomers, 1942 to 1960 • The Gen Xers, 1961 to 1981 • Millennials, 1982 to 2005 © McGraw-Hill Education Values, 3 Gen Xers have a clearly different view of authority than previous generations • Define leading as removing obstacles and giving followers what they need to work well • Expect managers to earn their promotions and not be rewarded with leadership responsibilities because of seniority Research has found little evidence of a generation gap in basic values • Studies show that Boomers, Xers, and Millennials in the managerial workforce are more similar than different in their views of organizational leadership © McGraw-Hill Education Moral Reasoning and Character-Based Leadership, 1 Moral reasoning: Process used by leaders to make decisions about ethical and unethical behaviors • Value differences among individuals often result in different judgments regarding ethical and unethical behavior • Not everyone fully develops their moral judgment © McGraw-Hill Education Moral Reasoning and Character-Based Leadership, 2 • Unconscious biases may affect one’s moral judgments, which is why many organizations are developing programs to develop moral decision-making competence among leaders • Effectiveness of such programs depends on understanding the moral decision-making process Dual-process theory of moral judgment • Moral judgments dealing with rights or duties are made by automatic emotional responses while those made on a more utilitarian basis are made more cognitively © McGraw-Hill Education Moral Reasoning and Character-Based Leadership, 3 Common but challenging ethical dilemmas involve choosing between two rights • Kidder identified the following common ethical dilemmas: • Truth versus loyalty: Honestly answering a question that may compromise real or implied promise of confidentiality to others • Individual versus community: Protecting the confidentiality of someone’s medical condition when the condition itself may pose a threat to the larger community • Short-term versus long-term: Balancing spending time with family against making career investments for future benefits © McGraw-Hill Education Moral Reasoning and Character-Based Leadership, 4 • Justice versus mercy: Deciding whether to excuse a person’s misbehaviour because of extenuating circumstances or a conviction that he or she has learned a lesson • Kidder offers the following principles for resolving ethical dilemmas: • Ends-based thinking: Doing what’s best for the greatest number of people • Known as utilitarianism • Rule-based thinking: Following the highest principle or duty • Consistent with Kantian philosophy • Care-based thinking: Doing what one wants others to do to him or her • Similar to the Golden Rule of conduct common in many world religions © McGraw-Hill Education Moral Reasoning and Character-Based Leadership, 5 Research has identified biases that affect our moral decisionmaking • Implicit prejudice: Subconscious prejudices that affect one's decisions without him or her being aware of them • In-group favoritism: Doing acts of kindness and favors for those who are like us • Overclaiming credit: Overrating the quality of one's own work and contributions • Conflicts of interest: Adversely impact ethical judgments and bias one's perceptions of situations © McGraw-Hill Education Moral Reasoning and Character-Based Leadership, 6 Ways in which people with firm moral principles may behave badly without feeling guilt or remorse over their behavior • Moral justification: Justifying otherwise immoral behavior in terms of a higher purpose • Euphemistic labeling: Disguising morally distasteful behavior with cosmetic words • Advantageous comparison: Avoiding self-contempt for one’s behavior by comparing it to even more heinous behavior by others • Displacement or diffusion of responsibility: Violating personal moral standards by attributing responsibility to others • Diffusion of responsibility: Excusing one’s own reprehensible behavior because others are behaving in the same way © McGraw-Hill Education Moral Reasoning and Character-Based Leadership, 7 • Disregard or distortion of consequences: Minimizing the actual harm caused by one’s behavior • Dehumanization: Avoiding the consequences of one’s behavior by dehumanizing those who are affected • Attribution of blame: Justifying one's immoral behavior by claiming it was caused by someone else’s actions Components of moral potency • Moral ownership • Moral courage • Moral efficacy © McGraw-Hill Education Avolio and Associates: Components of Ethical Leadership Moral person • Principled decision-maker who cares about people and the broader society Moral manager • Makes ethics an explicit part of the leadership agenda by communicating messages of ethics and values and by modeling ethical behavior © McGraw-Hill Education Character-Based Approaches to Leadership, 1 Authentic leadership • Authentic leaders exhibit consistency among their values, beliefs, and actions • Are self-aware • Self-consciously align their actions with their inner values • Study of authentic leadership has gained momentum because of the following beliefs: • Enhancing self-awareness can help people in organizations find more meaning at work • Promoting transparency and openness in relationships builds trust and commitment • Fostering more inclusive structures and practices can help build more positive ethical climates © McGraw-Hill Education Character-Based Approaches to Leadership, 2 Servant leadership views serving others as being the leader’s role • Characteristics of servant leaders • Listening • Empathy • Healing • Awareness • Persuasion • Conceptualization • Foresight • Stewardship • Commitment to others’ growth • Building community © McGraw-Hill Education Roles of Ethics and Values in Organizational Leadership Organizations have dominant values just as individuals do • Values represent the principles by which employees are to get work done and treat other employees, customers, and vendors • Leaders in an organization fail because of a misalignment between personal and organizational values Top leadership’s collective values play a significant role in determining the dominant values throughout the organization • Many of the most difficult decisions made by leaders are choices between opposing values • Leaders must set a personal example of values-based leadership and ensure that clear values guide everyone’s behavior in an organization © McGraw-Hill Education Leading by Example: The Good, the Bad, and the Ugly, 1 One of the most quoted principles of good leadership is “leadership by example” • Research shows that role models can be characterized using the following categories of attitudes and behaviors: • Interpersonal behaviors: They show care, concern, and compassion for others • Basic fairness: They show fairness to others • Ethical actions and self-expectations: They hold themselves to high ethical standards and behave consistently in both their public and private lives • Articulating ethical standards: They articulate a consistent ethical vision and are uncompromising toward it © McGraw-Hill Education Leading by Example: The Good, the Bad, and the Ugly, 2 Upward ethical leadership: Leadership behavior enacted by individuals who take action to maintain ethical standards in the face of questionable moral behaviors by higher-ups • General quality of an organization’s ethical climate affects whether or not employees raise ethical concerns • In ethical climates, ethical standards or norms are consistently and clearly communicated, embraced, and enforced by organizational leaders • In unethical climates, unethical behavior exists with little corrective action, and misbehavior may even be condoned © McGraw-Hill Education Creating and Sustaining an Ethical Climate, 1 “Fronts” of leadership action required to create an ethical climate • Formal ethics policies and procedures • Core ideology • Integrity • Structural reinforcement • Process focus © McGraw-Hill Education Creating and Sustaining an Ethical Climate, 2 Principle-centered leadership asserts a fundamental interdependence between the personal, interpersonal, managerial, and organizational levels of leadership • Interdependence between the levels posited in principle-centered leadership is similar to the conceptualizations of authentic leadership © McGraw-Hill Education Summary • There is a relationship between ethics, values, and leadership • It is not just the content of what one believes is right and wrong but how one makes moral or ethical judgments • Ethical dilemmas often involve a choice between two “rights” rather than choices between what is right or wrong • Recent research has explored the interdependencies between effective leadership and particular value systems © McGraw-Hill Education
