LDR 7980 Capstone Essay Four Assignment Ethics and Leadership

Runninghead: EthicsAndLeadership 1
Essay Four Assignment
Ethics and Leadership
Ardavan A. Shahroodi
Northeastern University
LDR 7980---Master’s Project Capstone
Professor Courtland Booth
Sunday, June 7, 2015

EthicsAnd Leadership 2
Introduction
The central question faced in this assignment inquires as to the reasoning underpinning
unethical decision making in contemporary organizations. In this light, this essay first contends
that the very nature of the modern organization deprive employees of the indispensable quality of
engagement necessary in the ethical education and development of both leaders and followers.
Secondly, the essay studies the reasons behind unethical decision making in contemporary
organizations. Thirdly, this paper takes into consideration a number of recommendations that
facilitate ethical decision making on the individual level. Most importantly, this essay strongly
argues that moral education and development of both leaders and followers is only continuously
sustainable in workplace environments where ethical conduct and orientation is recognized as the
central element of organizational leadership exercised through a culture of authentic engagement.
The Management and Leadership Orientation of the Modern Organization and its
Impact on the Moral and Ethical Development of Employees
The theoretical, practical, managerial and leadership characteristics of the modern
organization emanate from the developments that commenced during the Industrial
Revolution (Late 18th Century, 19th Century, and Early 20th Century). Here, Adam Smith
(1776/1976) “described how a factory could produce more goods more cheaply than
could be made by hand by a craftsman, because each worker did one part of the
production process and could become more skilled and efficient at that task” (as cited in
York, 2010, p. 3). Essentially, the very focus of such an organization became the
“division of labor and specialization of function” (York, 2010, p. 3). This modernizing
process evolved further “with the advent of Frederick Winslow Taylor’s (1911) ideas on
Scientific Management” (as cited in York, 2010, p. 3) that utilized “time-and-motion

studies” (p. 3) in order to “make the job as simple as possible to learn and to do,
minimizing training costs and maximizing productivity” (p. 3).
The advent of Scientific Management led to the creation of organizations that,
“Became divided into those who determined the optimal way to perform the work
and those who did the work. This division between managers and workers can
still be seen in many workplaces today, where managers are considered to be
sources of value and the people who do the work are assumed not to have any
sound ideas about increasing productivity or quality” (York, 2010, pp. 3-4).
An extension of the above dynamic is the excellent analysis of Douglas McGregor
(1960) that “introduced the term Theory X to refer to a management style characterized
by close supervision. The basic assumption of this theory is that people really do not
want to work hard or assume responsibility. Therefore, in order to get the job done,
managers must coerce, intimidate, manipulate, and closely supervise their employees” (as
cited in Whetten & Cameron, 2011, p. 330). McGregor (1960) observes that “most
managers subscribe to Theory X assumptions about workers motives” (as cited in
Whetten & Cameron, 2011, p. 330).
The aforementioned analysis of the forces that led to the creation of the modern
organization describes a workplace environment characterized by disengagement,
detachment and distance among managers/leaders and their subordinates/followers.
Although, in such a workplace atmosphere, as McGregor (1960) has contended,
managers/leaders attempt to “closely supervise their employees” (as cited in Whetten &
Cameron, 2011, p. 330), due to structural characteristics, they remain spiritually and
emotionally distanced from their subordinates/followers.

This spiritual and emotional separation also negatively influences the moral and
ethical development of both managers/leaders and their subordinates//followers.
Consequently, moral and ethical development and orientation is institutionally deprived
of organizational support while consistently relegated to the domain of individual choices
or indeed arbitrariness. This phenomenon is expertly described by Badaracco and Webb
(1995) in their article titled “Business Ethics: A View from the Trenches” (pp. 8-28)
where the authors conducted a study of young managers who,
“Defined professional ethics in terms of self-reliance and mobility rather than
community and commitment…young managers expressed a willingness to walk
out the door rather than compromise their values. For them, being ethical involves
fidelity to one’s own values and willingness to leave an organization that fails to
match these values. In short, it means being able to take a stand and walk away.
Ethics was a matter of exit, rather than loyalty or voice” (p. 21).
In this light, modern organizations are continuously in jeopardy of losing their
knowledge workers, “human capital” (Noe, et al, 2013, pp. 20-21) or for that matter other
valuable associates due to their innate inability to support the moral and ethical
development of their employees. In the end, in such an environment “ethical lapses” are
mostly avoided through “self-reliance” (Badaracco & Webb, 1995, p. 21) or “willingness
to leave an organization” (p. 21). Importantly, this is not to assert that individuals and
their respective organizations are inherently unethical in the contemporary environment.
Rather, it is to bring attention to the innate arbitrariness of moral choices among
individuals in organizations where current institutional arrangements are incapable of

supporting and continuously sustaining the ethical development of both leaders and
followers.
The Nature of Unethical Decision Making in Organizations: Why Do People Make
Unethical Decisions
The research of Badaracco and Webb (1995) that studied the workplace related
experiences of “recent graduates of the Harvard MBA Program” (p. 8) illustrates “several
disturbing patterns” (p. 8) underlying unethical decision making in contemporary
organizations. First, these young managers stated that frequently they “received explicit
instructions from their middle-manager bosses or felt strong organizational pressures to
do things that they believed were sleazy, unethical, or sometimes illegal” (Badaracco &
Webb, 1995, p. 8). Secondly, young managers stated that “corporate ethics programs,
codes of conduct, mission statements, hot lines, and the like provided little help”
(Badaracco & Webb, 1995, p. 9).
Thirdly, the young managers were of the opinion that “their company’s executives
were out-of-touch on ethical issues, either because they were too busy or because they
sought to avoid responsibility” (Badaracco & Webb, 1995, p. 9). This is a most crucial
assertion when the central role of leaders in creating the culture of an organization is
considered. Fourth, young managers reflected that they “resolved the dilemmas they
faced largely on the basis of personal reflection and individual values, not through
reliance on corporate credos, company loyalty, the exhortations of senior executives,
philosophical principles, or religious reflection” (Badaracco & Webb, 1995, p. 9). The
aforementioned reflections paint a picture of workplace environments where at best

ethical education and development of both leaders and followers exist in the periphery
and not at the center of organizational existence.
How Not to Make Unethical Decisions on an Individual Level in Organizations
Kerns (n. d.) observes that at the “most basic level”, a leader’s decision making process
and “ethical choices and dilemmas” (Kerns, n. d.) are based and strongly affected by that
individual’s “patterns of thinking” (Kerns, n. d.) that are generated from their “values” (Kerns, n.
d.). This system of values assists leaders in “discerning right from wrong and acting in
alignment with such judgement” (Kerns, n. d.) all the while separating “leaders who have not
internalized a value system” (Kerns, n. d.) from those that conduct themselves according to
“such a system” (Kerns, n. d.). Here, a leader’s “strong value system and a professional and
ethical approach to management” (Kerns, n. d.) inhibits the emergence of “mental gymnastics or
mind games” (Kerns, n. d.) preventing “an otherwise good person to make unethical decisions”
(Kerns, n. d.).
Kerns (n. d.) regards the first of these mind games as a tendency on the part of some
leaders to “simplify…a complicated problem” into “understandable and readily available
elements related to the decision” (Kerns, n. d.). This inclination, labeled as “satisfying” (Kerns,
n. d.) prevents leaders from appreciating and acknowledging the “complexities” (Kerns, n. d.)
that reside in a given problem thereby facilitating the type of “solutions that are less optimal or
even ethically deficient” (Kerns, n. d.). Accordingly, “full rationality gives way to bounded
rationality” (Kerns, n. d.) where leaders select options that “tend to be easy to formulate,
familiar, and close to the status quo” (Kerns, n. d.) depriving them of creative “ideas beyond the
usual responses” (Kerns, n. d.).

This type of ethical conceptualizing and decision making, Messick and Bazerman (1996)
contend leads to “overlooking low probability events, neglecting to consider some stakeholders,
and failing to identify long-term consequences” (as cited in Kerns, n. d.). Kerns (n. d.) proposes
that “oversimplifying and reaching less than optimal solutions to ethical challenges” may be
prevented if leaders develop a habit to “discuss the situation with other trusted colleagues”
(Kerns, n. d.) requesting that they “play devil’s advocate” (Kerns, n. d.) and “to challenge…
[their] decision” Kerns, n. d.).
An additional scholar, Laura Nash (1989) emphasizes the “importance of problem
identification and information gathering” (as cited in Kerns, n. d.) on the part of leaders by
asking the type of questions that may assist them “guard against over simplifying an otherwise
complicated ethical decision” (as cited in Kerns, n. d.). Here, potentially, one of the most central
questions that Nash (1989) argues leaders who wish to engage in ethical decision making must
ask is the following:
“Could I disclose without reservation my decision or action to my boss, our CEO,
the Board of Directors, my family, or society as a whole” (as cited in Kerns, n. d.).
The above inquiry is a fundamentally crucial imperative in all manner of decision
making very much in line with Immanuel Kant’s (1724-1804) concept of the “categorical
imperative” (as cited in Russ Shafer-Landau, 2007, p. 530) describing an ethical choice
as an “action as objectively necessary of itself, without reference to another end” (p.
530). In this light, Kant’s categorical imperative mandates that,

“Act only in accordance with that maxim through which you can at the same time
will that it become a universal law” (as cited in Russ Shafer-Landau, 2007, p.
534).
Consequently, in order for a decision to be regarded as an ethical one, it must be
considered as such by all who may be effected by that decision in any manner, shape or
form, by what Nash (1989) labels as the “society as a whole” (as cited in Kerns, n. d.) and
indeed according to the Kantian maxim of categorical imperative mandating that such an
action must possess the requisite moral qualities to be elevated and accepted as a
universal law.
Kerns (n. d.) suggests that a second type of mind games facilitate “ethical lapses”
in decision making among leaders. Here, Kerns (n. d.) reasons that among certain leaders
“the need to be liked may cause them to overlook…transgressions” emanating from the
“irrational…belief that one can or should always be liked” (Kerns, n. d.). Eventually, this
“overriding desire to be liked can ultimately adversely affect the ethics of people in an
organization” (Kerns, n. d.). Kerns (n. d.) proposes that in these situations, leaders must
“distance” themselves from “subordinates (e.g., reduce unnecessary socializing)” (Kerns,
n. d.) in an effort to “establish some objective boundaries” (Kerns, n. d.). In addition,
Kerns (n. d.) argues that leaders must endeavor to “respond warmly and assertively
toward employees while still going forward with appropriate but possibly less popular
decisions”.
Kerns (n. d.) detects a third manner of mind games that he labels as “dilute and
disguise” inhibiting ethical decision making on the part of leaders. Here, affected leaders
in an effort to “strike a diplomatic chord” (Kerns, n. d.) or fearing a looming

confrontation “disguise the offensiveness of unethical acts by using euphemisms or
softened characterizations” (Kerns, n. d.). Kerns (n. d.) asserts that these leaders may
attempt to be viewed as “kinder and gentler, or just politically correct”, however such a
posture “helps wrongdoers and those associated with them to get away with unethical
behavior” (Kerns, n. d.). Kerns (n. d.) warns that “softened characterizations serve to
reduce the anxiety of the leader, but these euphemisms are dishonest” and have the
capacity of corrupting the “necessary intensity of ethical constraints that should be
brought to bear in the situation” (Kerns, n. d.). Kerns (n. d.) encourages leaders to “talk
straight and to avoid euphemistic labeling or re-characterizing unethical behavior” (n. d.).
A fourth expression of mind games that may lead to unethical decision making is
referred to by Kerns (n. d.) as “making positive” a leader’s moral transgressions
compared “to more heinous behavior committed by others” (Kearns, n. d.) in order to
“avoid self-degradation” (Kearns, n. d.). This tendency must also be evaluated in terms
of Kant’s (1724-1804) categorical imperative (discussed earlier) when leaders fail to
evaluate and judge their actions on the basis of a “maxim” (as cited in Russ Shafer-
Landau, 2007, p. 534) that can be accepted and promoted to the status of a “universal
law” (p. 534). In this light, Kerns (n. d.) proposes the following important question that
leaders must ask themselves in order avoid “making positive” their own unethical
conduct: “What should three objective observers say about me and my objectivity
regarding this comparison” (Kerns, n. d.). In this particular question, the ethical standard
of “objectivity” (Kerns, n. d.) is a logical extension of Kant’s categorical imperative that
mandates the need to universalize all actions in order to thoroughly satisfy all ethical

considerations. Kerns (n. d.) adds that “when ethical transgressions are involved,
relativity does not excuse ethical lapses”.
Kerns (n. d.) reminds prospective leaders that a fifth mind game that may lead to
unethical decision making is the specter of “overconfidence” that propel leaders to
“perceive their abilities to be greater than they actually are” (n. d). This tendency,
frequently observed, moves leaders to “discount others’ perceptions and thus easily
overlook the insights and talents of other people” (Kerns, n. d.). Here, in the absence of
“input from those around them, overconfident managerial leaders may be blind to the
most appropriate ethical choices in given circumstances and may consider only their own
ideas regarding the best course of action” (Kerns, n. d.).
Kerns (n. d.) holds that overconfident leaders diminish “their people, useful
information, and learning opportunities to the sidelines while pursuing their own courses
of action” simultaneously depriving themselves of “fresh perspectives and thus perhaps
better solutions to ethical problems” (Kerns, n. d.). Ironically, this indeed may prove to
be disastrous to the morale of the team and utterly destructive of the confidence level of
subordinates and their sense of empowerment. In terms of corrective actions or postures
that leaders may assume in order to negate the debilitating effects of their own
overconfidence, Kerns (n. d.) proposes the adoption of “more open ended, What do you
think? types of inquiries”. This particular relational leadership temperament “will
positively impact the ethical problem solving climate within the entire organization”
(Kerns, n. d.).

Leadership and the Ethical Development of Leaders and Followers
Northouse (2013) observes that “because leaders usually have more power and
control than followers, they also have more responsibility to be sensitive to how their
leadership affects followers’ lives” (p. 428). Indeed in one of the most crucial
observations of his book, Northouse (2013) contends that,
“Although all of us have an ethical responsibility to treat other people as unique
human beings, leaders have a special responsibility, because the nature of their
leadership puts them in a special position in which they have a greater opportunity
to influence others in significant ways” (p. 428).
In essence, “ethics is central to leadership, and leaders help to establish and reinforce
organizational values” (Northouse, 2013, p. 423) and/or “play a major role in establishing the
ethical climate of their organization” (p. 423). Consequently,
“Ethics is central to leadership because of the nature of the process of influence,
the need to engage followers in accomplishing mutual goals, and the impact
leaders have on the organization’s values” (Northouse, 2013, p. 428).
In this light, appropriately, the particular approach embedded in “transformational
leadership involves attempts by leaders to move followers to higher standards of moral
responsibility” (Northouse, 2013, p. 429). Most importantly, Burns (1978) emphasizes that
leaders need to “engage themselves with followers and help them in their personal struggles
regarding conflicting values. The resulting connection raises the level of morality in both the
leader and the follower” (as cited in Northouse, 2013, pp. 429-430). In addition, Burns (1978)
places great emphasis on the “leader’s role in attending to the personal motivations and moral

development of the follower” (as cited in Northouse, 2013, p. 430). Here, Burns (1978) asserts
that “it is the responsibility of the leader to help followers assess their own values and needs in
order to raise them to a higher level of functioning, to a level that will stress values such as
liberty, justice, and equality” (as cited in Northouse, 2013, p. 430).
The question of leader-subordinate/follower engagement is also very much of a highest
priority in the theory of servant leadership where Greenleaf (1970, 2008 Revised Printing)
asserts that servant leaders must,
“Make sure that other people’s highest priority needs are being served. The best
test, and difficult to administer, is: do those served grow as persons; do they,
while being served, become healthier, wiser, freer, more autonomous, more likely
themselves to become servants? And, what is the effect on the least privileged in
society; will they benefit, or, at least, will they not be further deprived?” (p. 15).
On the basis of the ideas of eminent Classical Age and the Age of Enlightenment
philosophers (Aristotle) and the work of contemporary scholars, Northouse (2013)
observes that “respect, service, justice, honesty, and community” (p. 430) create the
“foundation for the development of sound ethical leadership” (p. 430). In relation to the
ethical leadership quality of respect, Northouse (2013) cites the ideas of Immanuel Kant
(1724-1804) who “argued that it is our duty to treat others with respect. To do so means
always to treat others as ends in themselves and never as means to ends” (as cited in
Northouse, 2013, p. 430). Northouse (2013) adds,
“Respect means that a leader listens closely to subordinates, is empathetic, and is
tolerant of opposing points of view. It means treating subordinates in ways that

confirm their beliefs, attitudes, and values. When a leader exhibits respect to
subordinates, subordinates can feel competent about their work. In short, leaders
who show respect treat others as worthy human beings” (p. 432).
In regards to the ethical leadership quality of service, Northouse (2013) cites the research
of a number of scholars who have “maintained that attending to others is the primary building
block of moral leadership” (p. 432). Here, Senge (1990) observes that in the emerging “learning
organizations” (as cited in Northouse, 2013, p. 432), a central responsibility of leaders is to be,
“The steward (servant) of the vision within the organization. Being a steward
means clarifying and nurturing a vision that is greater than oneself. This means
not being self-centered, but rather integrating one’s self or vision with that of
others in the organization. Effective leaders see their own personal vision as an
important part of something larger than themselves—a part of the organization
and the community at large (p. 432).
This reminder concerning self-centeredness is also in alignment with Kerns (n. d.)
argument that in order to engage in ethical decision making, leaders must avoid the mind
game of overconfidence.
With respect to the ethical leadership trait of justice, Northouse (2013) observes
that leaders must,
“Make it a top priority to treat all of their subordinates in an equal manner.
Justice demands that leaders place issues of fairness at the center of their decision
making. As a rule, no one should receive special treatment or special
consideration [favoritism] except when his or her particular situation demands it.

When individuals are treated differently, the grounds for different treatment must
be clear and reasonable, and must be based on moral values” (p. 433).
Perhaps, most importantly, in regards to the ethical characteristic of honesty,
Northouse (2013) holds that,
“When leaders are not honest, others come to see them as undependable and
unreliable. People lose faith in what leaders say and stand for, and their respect
for leaders is diminished. As a result, the leader’s impact is compromised
because others no longer trust and believe in the leader” (p. 435).
Northouse (2013) adds that honesty in leaders mandates “being open with others
and representing reality as fully and completely as possible” (p. 436). A poignant
example of this honesty in leadership is the necessity of contemporary leaders to speak
openly and honestly concerning the potential deleterious ramifications of climate change,
the destruction of the natural environment and the tragic destiny of the endangered
species. Here, Dalla Costa (1998) adds that organizational leaders must not “accept that
the survival of the fittest pressures of business release any…from the responsibility to
respect another’s dignity and humanity” (p. 436).
Finally, Northouse (2013) brings attention to the ethical leadership quality of
building community by citing the ideas of Burns (1978) on transformational leadership.
Burns (1978) argued that transformational leaders “move the group toward a common
good that is beneficial for both the leaders and the followers. In moving toward mutual
goals, both the leaders and followers are changed” (as cited in Northouse, 2013, pp. 436-
437). Such a leader “takes into account the purposes of everyone involved in the group

and is attentive to the interests of the community and the culture” (Northouse, 2013, p.
437).
Conclusion
The particular orientation of modern organizations promote suspicion, separation,
disengagement and detachment in between managers/leaders and subordinate/followers.
In these workplace environments the path of employees’ moral education and
development is a solitary journey left to the discretion of individual associates. Here,
employees who do engage in ethical decision making are deprived of the indispensable
quality of engagement in between leaders and followers often toiling in organizational
environments that in practice do not view ethics as the most fundamental element of
leadership.

References
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LDR 7980 Capstone Essay Four Assignment Ethics and Leadership

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LDR 7980 Capstone Essay Four Assignment Ethics and Leadership