Running head: MORAL AND ETHICAL TRAITS OF LEADER 1

The Moral and Ethical Traits of Leaders and the Effects on the Organization:

A Literature Review, 2010-2014

Richard V. Jones

The University of Texas at Tyler

Tech 5303.60 Research Tech in HRD / TECH

I embrace honor and integrity. Therefore, I

choose not to lie, cheat, or steal, nor to accept the actions of those who do.

MORAL AND ETHICAL TRAITS OF LEADERS 2

The Moral and Ethical Traits of Leaders and the Effects on the Organization:

A Literature Review, 2010-2014

Introduction

One only needs to look into the news headlines to see the devastation that can be caused

when an organizational leader lacks morals and ethics. A leader’s ability to lead is only as strong

as the moral and ethical base from which they are built. Brown and Trevino (2013) suggested

that “executive ethical leaders were frequently described as models of ethical conduct. Further,

when top managers are personally committed to ethics, their organizations’ ethics programs are

more comprehensive, have stronger aspirational orientations” (p.590). This study seeks to

examine the ethical and moral characteristics of the leader and the effects on the organization. In

addition, it seeks to look at the relevant literature that provides a road map for future training for

moral and ethical development of leaders.

Understanding ethical behavior of leaders translates into the understanding of the decision

making processes of groups within organizations. It is through this understanding that research

can develop training that will provide organizations with the tools to combat unethical behavior

and the results of this type of behavior. In their conclusion Brown and Trevino (2013) suggested

that role modeling is related to ethical leadership and that an organization that looks to hiring

employees with strong role models in life and through development of strong ethical leadership

will positively affect the organizations outcome. (p. 597)

Review of Existing Literature

Review of the relevant literature reveals aspects that support the effects of ethical vs.

unethical behavior of leadership on organizations. Brown and Trevino (2013) suggest that

MORAL AND ETHICAL TRAITS OF LEADERS 3

organizations that view their leadership as ethical are stronger than their counterparts (p. 587). It

is through this relationship that both the positive and negative ethical behaviors between the

leader and the organization are connected.

Steinbauer , Renn, Taylor & Njoroge, (2013) implied that the ethical decisions of an

organizations leaders directly influences the decisions of a group. This implies that if a group

views the leader as ethical then the group will act in an ethical manner. Additionally, they

remarked that the ownership of the ethical action was the perceived ownership of the leader and

therefore not that of the followers (p. 381). This leads to the consideration that leadership ethics

determines the ethics of the group or organization with little to or no resistance as understood by

Hoyt and Price (2013). Furthermore, they determined that the presence of the leadership directly

influenced the decision of the group as opposed to the absence of leadership (p. 538)

Additionally, Frisch & Huppenbauer (2013) implied that organizations that educate and

equip their management teams with the tools in ethical decision making will have positive

impact on the organization when demonstrated through long term business strategy.

Strengthening this argument Lynham & Chermack (2006) implied that Ethics are measured by

what the group perceives of the leaders’ habits and that performance increases when responsible

leadership performance is translated into time, quantity, and alignment (p. 82).

Theoretical Framework

The theoretical framework for this study is based on empirical indicators developed by

Dr. Susan A. Lynham and Dr. Thomas J. Chermack under the title of The Units of the

Theoretical Framework. This includes the following areas of consideration as noted in their

studies. Empirical Indicators for the Unit of Constituency, Empirical Indicators for the Unit of

MORAL AND ETHICAL TRAITS OF LEADERS 4

Responsibleness, Empirical Indicators for the Unit of Performance, and Empirical Indicators for

the Leadership System-in-focus. Dr. Lynham and Chermack studies specified a relation to moral

and ethical behavior under the Emperical Indicators for the Unit of Responsibleness in the

framework has implied results directly related to this study. ( Lynham & Chermack, 2006, p. 82)

Purpose of the Study

The purpose of this study is to evaluate relevant scholarly literature on moral and ethical

leadership that will in turn lead to a deeper understanding of the development of the morale and

ethical leadership. It is this author hope to gain an increased amount of knowledge that will gain

a greater understanding of the source of moral and ethical leadership traits.

Guiding Research Question

The researcher is guided by the research question, According to recent peer-reviewed

literature, how are moral and ethical leadership traits developed and what are the results of the

moral and ethics of a leader on the organizational culture?

Delimitations and Limitations

This study will focus primarily on discovery and analysis of the published peer-reviewed

literature found in databases subscribed to by The University of Texas at Tyler library relevant to

this study. It is limited by the availability of literature that can be located in the UT Tyler library.

It may contain other scholarly works such as books and monographs if they are readily available

for the researcher as background information.

Significance of the Study

This review of literature is significant because it explores the traits, morals, and ethics of

leadership. Today’s society is often plagued by corruption and mistrust of organizational leaders

thus it is imperative that we gain a full understanding of the moral and ethical decisions of

MORAL AND ETHICAL TRAITS OF LEADERS 5

leader’s and their subsequent effect on organizational culture if the direction of the of the society

is to change as a whole. “Based on prior work suggesting that third parties also make fairness

judgments and respond to the way employees are treated, this study first suggests that

perceptions of interactional justice for peers (IJP) lead employees to two different responses to

injustice at work”

Methodology

This study will utilize peer reviewed scholarly literature. Analysis of the literature will

seek to discover the moral and ethical traits of leadership and their perceived effects on the

organization as well as possible future trainings that are conducive for the moral and ethical

development of future leaders.

Study Design and Data Collection Procedures

The basis for this study is that of a literature review. In this study, peer-reviewed

literature is located and then analyzed to develop paths for future leadership development and

literary knowledge. In the current study, data collection will involve the discovery of peer-

reviewed articles from The University of Texas library database pertaining to the above

mentioned subject matter. Search terms included ethical leadership, ethics, organizational

culture, morals, social model, leader, employee, and leadership development occurring within

article titles. Databases will include gleaned from databases at: The University of Texas at Tyler.

Results

Examination of the peer reviewed articles have pointed towards a conclusion that there is

a perceived connection between the ethics and moral behavior of leadership and the relationship

to the followers for which they lead. The following observations were noted as a result of this

perceived behavior of leaders. When employees are treated unjustly there are two ways in which

MORAL AND ETHICAL TRAITS OF LEADERS 6

the other members of a group may respond. Deviant Workplace Behavior (DWB) or

Organizational Citizenship Behavior (OCB) (Zoghbi-Manrique-de-Lara & Sua´rez-Acosta, 2013,

p. 537) Studies have indicated that the leaders are the driving force behind the ethical standards

of their team members as a result of their actions or inactions in ethical and moral behavior.

“executive ethical leaders were frequently described as models of ethical conduct. Further, when

top managers are personally committed to ethics, their organizations’ ethics programs are more

comprehensive, have stronger aspirational orientations” (Brown et al., 2013, p. 590)

Studies have shown that when individuals are given the independent choice to make

decisions they tend to follow less unethical decision making on the behalf of the group.

However, when the focus of the group decision is directly associated with the group leader

decision role the group will tend to engage is less ethical behavior to benefit the group. This is to

say that the group will tend to do as they are told to do by the leader with little resistance. (Hoyt

& Price, 2013, p.536) The relationship of the leader to the followers has a direct correlation to

the results of the decisions of ethical and moral decision making. Hoyt et al., (2013) found that

the relationship of the leader and their ethical decisions forces the decision of the team members.

This relationship can be that of a positive of negative influence on the teams overall ethical

standards. Additionally, Steinbauer, Renn ,Taylor & Njoroge, (2013) found that the follower’s

decision to abide by the leaders ethical decision was based on the perception that the ownership

still belong to the leader. Only when the followers were engaged in deliberation over the ethical

issue did the self-leadership of the followers show a different direction than the leader.

Further indications of the leader’s ethics and moral standards were found to directly influence the

productivity of the given employees. Demirtas, (2013) found that as leaders influence the

outcome of work performance through ethical leadership both ethical and unethical behavior.

MORAL AND ETHICAL TRAITS OF LEADERS 7

Leaders viewed as ethical leaders raise the sense of justice while those of questionable ethics

lower the perception of justice within an organization. This seems to point to the evidence that a

leader directly shapes the organization through their perceived ethical and moral behavior.

Given the information discussed the following question was raised as to the level of

ethical and moral behavior among leaders. In order to develop ethical leaders we must educate

and equip managers with competencies used in ethical decision making and in doing so we must

first ask the following question. How ethical of a leader am I? (Frisch & Huppenbauer, 2013,

p.39)

MORAL AND ETHICAL TRAITS OF LEADERS 8

So where in turn does this all lead? Moral courage promotes ethical and pro-social behavior and

moral courage is critical for the theoretical argument explaining the link between moral-

judgement and moral behavior. (Hannah, Avolio, & Walumbwa, 2011, p.571) This study

seem to indicate managers that display the following leadership qualities such as integrity,

fairness, rewarding, supportive, and live up to the standards of an ethical role model are more

adapt to overcome obstacles and follow the ethical path. (Lu, & Lin, 2013, p.221) However, it is

only through training that our leaders will ever reach a higher level of ethical behavior. Taylor &

Pattie (2014) made this conclusion as to the importance of investing and developing of leaders in

an ethical environment. Taylor et al., (2014) found that “investing in ethics and ethical leaders.

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Consistent with prior research, our findings suggest organizational efforts aimed at increasing

ethical leadership can be helpful in reducing follower incivility. Such interventions are

particularly important given that leaders’ actions influence the behavior of employees at lower

organizational levels”

The greatest discovery made by the researcher was in the works of Susan A. Lynham and

Thomas J. Chermack. It was through their Unit of Constituency that gave a greater understanding

of the previous discussed reviews. What this author found to be the most conclusive outside of

the theoretical modeling was their following connection to ethical behavior. (Lynham &

Chermack, 2006)

Lynham & Chermack, (2006) found that “Empirical Indicators for the Unit of

Responsibleness” as discussed gave the following “The value of responsibleness increases as

measured by effectiveness, ethics and endurance, where…

• effectiveness is measured by constituency perception of effective leadership practices.

• ethics is measured by constituency perception of ethical leadership habits, and

• endurance is measured by constituency perception of the nature and employment of enduring

resources.” (Lynham et al., 2006, p.82) Unfortunately, the path as to what determines an ethical

leader versus an unethical leader is unclear. However, there seems to be a clear indication

through research that clear connections exist between the behavior of leaders and the effect on

their employees.

Table 1: is a summary of concepts related to this research. Although this is merely a

synopsis of authors concepts, its meaning points towards perceived evidence that ethical

leadership is directly associated with follower’s behavior. It is this researcher hope that a

correlation between ethics and the resulting actions of followers can be clearly understood.

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Table 1 General Contributing Idea by Topic and Credited Authors Description

Key Discussion Authors DescriptionPositive orNegative

Influencer

Implied Action Vs.

Direct Action

Authors

Ethical Leadership

When executive leaders are personified as ethical leaders their organizational programs in ethics are stronger than their counterparts.

Positive Direct ( Brown & Trevin˜o, 2013)

Results of Unethical Treatment

When employees are treated unjustly there are two ways in which the other members of a group may respond. Deviant Workplace Behavior or Organizational Citizenship Behavior

Negative Implied(Zoghbi-Manrique-de-Lara & Sua´rez-Acosta, 2013)

Non-leading versus leading roles in ethical decision making

When a group is placed under leadership the ethical decisions of the leader tends to become the ethical decision of the group with little resistance.

Both Implied (Hoyt & Price, 2013)

Role relationship in ethical decision making

The relationship of a leader’s ethical decision directly influences the decisions of the group

Both Direct(Steinbauer , Renn,Taylor & Njoroge, 2013)

Ethical leadership behavior

Leaders influence the outcome of work performance through ethical leadership both ethical and unethical behavior.

Both Direct (Demirtas, 2013)

Ethical level of leadership

Educate and equip managers with competencies used in ethical decision making.

Positive Direct(Frisch & Huppenbauer, 2013)

Moral courageMoral courage promotes ethical and pro-social behavior Positive Direct

(Hannah, Avolio, & Walumbwa, 2011)

Ethical Leadership

Investing in the ethics of our leaders and increasing ethical leadership decreases the team’s lack of caring and poor performance of team members under leadership.

Positive Direct (Taylor &Pattie 2014)

Empirical Indicators for the Unit of Constituency

The group’s needs are measured through formal and informal inputs in the evaluation of leadership.

Positive Direct (Lynham & Chermack, 2006)

Empirical Indicators for the Unit of Responsibleness

Ethics are measured by what the group perceives of the leaders habits Both Implied (Lynham &

Chermack, 2006)

Empirical Indicators for the Unit of Performance

Performance increases when responsible leadership performance is translated into time, quantity, and alignment

Positive Direct (Lynham & Chermack, 2006)

Empirical Indicators Leadership using the group’s feedback Positive Direct (Lynham &

MORAL AND ETHICAL TRAITS OF LEADERS 11

for the Leadership System-in-focus

of what a leader should be in practice increases the effectiveness of the leadership.

Chermack, 2006)

Effects of Ethical Leadership

Employees that work within an ethical environment will tend to act in an ethical behavior

Positive Implied (Lu, & Lin, 2013)

Discussion and Future Direction

How moral and ethical leadership traits developed and what are the results of the moral

and ethics of a leader on the organizational culture? This was the driving question behind the

relevant literature review. Research implied a relationship between leadership ethics and the

decision made by the followers within the leaders group or organization. This relationship can

lead to both a positive outcome and a negative outcome based on the perceived ownership of the

behavior by the leader and the type of ethical or unethical behavior. (Steinbauer , Renn, Taylor &

Njoroge, (2013) p.381)

It is further understood that through education leadership can be developed towards

positive ethical decision that will in turn result in a positive business model if pursued over a

long term plan of development. It is understood that in an ethical environment the group or

organization will outperform another similar group within an unethical environment. (Frisch et

al., 2013)

What is not truly understood is the choice to follow an ethical vs. an unethical path. This

researcher is guided to a consideration through the evidence presented that a deeper decision

making process should be considered. Future research that further explains the reasoning behind

the individual thought process following one path or another will lead to a better understanding

of how to train the leadership in managing ethical and business decisions.

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It is this researcher’s opinion that individuals making decisions daily exist within what I will

refer to as the kaleidoscope effect. This is the point in which all options good or bad are on the

table and given the available options most individuals will follow the path of least resistance

good or bad which leads to the most favorable or least involved outcome. However, there is little

research available to fully support this idea and could be examined further by this or other

researchers.

References

Brown, M., & Trevino, L. (2013). Do role models matter? An investigation of role modeling as an antecedent of perceived ethical leadership. Journal of Business Ethics, (122), 587–598-587–598.

MORAL AND ETHICAL TRAITS OF LEADERS 13

Demirtas, O. (2013). Ethical leadership influence at organizations: Evidence from the field. Journal of Business Ethics, (126), 273–284-273–284.

Frisch, C., & Huppenbauer, M. (2013). New insights into ethical leadership: A qualitative investigation of the experiences of executive ethical leaders. Journal of Business Ethics, 2014(123), 23–43-23–43.

Hannah, S., Avolio, B., Walumbwa, F., & Arnold, D. (2011). Relationships between authentic leadership, moral courage, and ethical and pro-social behaviors. Business Ethics Quarterly, 21(4), 555-578.

Hoyt, C., & Price, T. (2013). Ethical decision making and leadership: Merging social role and self-construal perspectives. Journal of Business Ethics, (126), 531–539-531–539.

Lu, C., & Lin, C. (2013). The effects of ethical leadership and ethical climate on employee ethical behavior in the international port context. Journal of Business Ethics, (124), 209-223.

Lynham, S., & Chermack, T. (2006). Responsible leadership for performance: A theoretical model and hypotheses. Journal of Leadership & Organizational Studies, 12(4), 73-88.

Steinbauer, R., Renn, R., Taylor, R., & Njoroge, P. (2013). Ethical leadership and followers’ moral judgment: The role of followers’ perceived accountability and self-leadership. Journal of Business Ethics, (120), 381–392-381–392.

Taylor, S., & Pattie, M. (2014). When does ethical leadership affect workplace incivility? The moderating role of follower personality. Business Ethics Quarterly, (24), 4-4.

Zoghbi-Manrique-de-Lara, P., & Sua´rez-Acosta, M. (2013). Employees’ reactions to peers’ unfair treatment by supervisors: The role of ethical leadership. Journal of Business Ethics, (122), 537–549-537–549.