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The Importances of Ethical-Leadership

ETHICAL LEADERSHIP
The Importance of Ethical-Leadership

By:
Suraj Prasad Simkhada
MBA 6th Trimester
IAU Login ID: 102662

To:
Prof. Dr. SRV. Raj Kumar Sharma
Kings College, Kathmandu, Nepal

Suraj Prasad Simkhada

The Importances of Ethical-Leadership

ETHICAL-LEADERSHIP
Leadership is all about influencing and inspiring people towards the achievement of
certain goals. An effective leader is the person who makes his follower to think and act
extraordinary for the organization beyond his personal needs. This will help to use organizational
resources in optimum level with consideration to the environmental factors towards the
attainment of organizational goal. Leadership is ultimately about creating a way for people to
contribute to making something extraordinary happen. The leadership is a learned ability, the
skills and knowledge processed by the leader can be influenced by his/her characters like belief,
value, ethics, and moral character. (Sharma R. K., 2014).
Beginning of humanity is the starting point of ethics. But the definition of ethics dates
back to Plato and Aristotle in the western world. The work ethics has been brought form Greek
word- ethos, which means culture, character, or attitude. It is the consideration for right and
wrong, or the consideration for moral principle in the society. Oxford Dictionary defines ethics
as the moral principle that governs or influence a conduct. The ethical behavior that is performed
by a person determines his right or wrong doings, and as to influence others, the positive
impression is very essential (Mihelic, 2010).
When the words ethics and leadership comes together, the concept of ethical leadership is
pointed out. It is the process of influencing people with social belief, morale and norms which
ultimately benefits the society. In consideration of the organizations, ethical leader considers
his/her morale and displays loyalty for the work so, with his act the use of proper disciplinary
works, procedures with right tools in right time helps the employees to generate positive impact.
Similarly, the leaders act as a role model to the employees. Also, they generate a positive feeling

Suraj Prasad Simkhada

The Importances of Ethical-Leadership

of honesty and integrity among the workers and followers. Those organizational tasks and works
are carried with synergy, as all of the employees put their efforts to reach towards the
organizational goal. So a visionary leader doesnt take his employee where they want to reach
but they take where they need to be (Carter, 2012).
The leadership traits are effective and efficient, when the components of ethical
leadership are well understood and adopted in organization properly. These four components are
purpose, knowledge, authority, and trust (Goleman, 2000).
The qualities of an ethical leader:

Team and organizational focus rather than personal goals.

Act as a role model to the employees.

Avoid discrimination among the employees, provide equal opportunity to all.

Take suggestions and views from each member of the team.

Work with the team and act as a part of the team.

If any wrong doings is seen taking feet down and act as needed.

Any adverse effect shouldnt be seen in action and decision on the work.

Accountable responsible for the teams task.

Make the team ready to face any challenge during hurdles and keep in right direction.

Ethical-Leadership: Principles
As described by many scholars, the main basic considerations for ethical-leadership are

Respect

Readiness to serve

Suraj Prasad Simkhada

The Importances of Ethical-Leadership

Providing Justice

Honesty & Integrity

Build community.

Based on these principles, a leader must practice fair work activities in the workplace. As
per the principle, the leader must act as a servant to the team, share everything among the team,
respect each member of the team, provide credit to the member of the teams as deserved, and
develop such a feeling among those members that each are working for all and all for each
(Principles of Ethical Leadership, 2012). For sustainability and for smooth operation of business
in the long run, the principles of ethical leadership are to be considered.
Ethical-Leadership: Importance
To increase the efficiency and effectiveness, ethical-leadership is the most essential for
an organization. Every aspect of the company, regarding employee commitment, trust loyalty, is
the result of the leaders performance. Itll also help to improve productivity, efficiency and
overall performance within the organization. The reason why a company cant work well is, they
dont have trust for the employees. Distrust, disloyalty and poor performance is brought up by
unethical behavior of the corporation (Ferrell, The Role of Ethical Leadership in Organizational
Performance, 1999). This is what an organization must focus on, and this situation is only
overcome when an organization has trustworthy ethical-leaders.
As we know, the term ethical-leadership is coined with two words: ethics and leadership,
the ethical act of leaders affects the performances of organization. Devoting own self for the
organization and going beyond the personal benefit helps to uplift the organization to the level of

Suraj Prasad Simkhada

The Importances of Ethical-Leadership

great successfulness and that is the act of effective successful leader. Here are some of the
reasons for why an organization needs an ethical-leadership role.
Wise & effective decision making: For the long term operation and sustainability of the firm, the
plans, policies and decisions should be made with farsighted vision. The decisions made for the
personal benefits may ruin the life of the organization.
Increased participation and motivation: When each of the employees is treated with equality,
they become more participative and more motivated. They will put full effort for their work.
Consulting with them helps to feel themselves as an important person to the organization.
Culture development: The leaders are the role model. Every works done by them will be
followed by his follower. Hence, the culture of loyalty, honesty & integrity develops.
Productivity and efficiency: Every employees following the leader remains duly responsible for
their tasks, they become accountable and responsible for their actions.
Economical and financial stability: With the better leader, sound decisions and healthy policies
are adopted, the investments remains safe, capital goes increasing, dividends are ensured.
Protection of property: As long as the leader remains accountable, the assets of the owners are
always safeguarded. Companys property remains safe and stakeholder feels secured.
Sustainable and change oriented: As employees are the assets of an organization and also the
internal customers, they know the inside out of the company. The leader must drive them to
thrive for success and necessary adjustment are needed to meet the changing need in the market.
Holistic development: Telling is selling, as employees are the internal customers, their word of
mouth helps the organization to grow. This act of these people is beneficial to the company.
Suraj Prasad Simkhada

The Importances of Ethical-Leadership

Societal recognition: The act done by a leader creates an image to the followers and to the public.
The company becomes renowned globally, and all other people and organization follow them.

Ethical-Leadership: Hindrance
Due to the moral dilemma among the choices the decisions couldnt be effective. Being a
leader, there should always be the right choice for any acts he performs. Sometimes for the
benefit of the organization, unwillingly or unintentionally the decisions have to be made and that
may effect in the positive feeling of the employees. It may bring positive result in the
organization but may destroy the positive name in the society. Also with emotional attachments,
stresses, unethical decisions and acts may happen. With pressures inside and outside the
organization, the unethical act may be seen as a result the society may not be ready to accept the
decision. Similarly, these doings may turn a leader into an incompetent one among the
employees, s/he couldnt get chance to perform well. As a result a good ethical leader may turn
into an inferior leader and this distrust, de-motivation may hinder the sustainability of the firm.

Conclusion
Ethical leadership is not only a need but also a social responsibility in the organization. It
determines the sustainability and competency of the firm. Ethics, morale, loyalty are the key
characteristics an ethical leader must have. This generates a positive impression among the
employees and makes a leader a role model. This behavior of the leader influences the behavior
of the employees and followers to devote themselves to their organization devoid of their
personal need. This brings a positive culture in the organizations. And the leaders always remain
an example in the society and in the organization for his ethical doings. Hence, ethical-leadership
is very crucial to the organization to remains sustainable in this dynamic world.

Suraj Prasad Simkhada

The Importances of Ethical-Leadership

Bibliography
Goleman, D. (2000, April). Leadership That Gets Results. Havard Business Review .
Ferrell, D. L. (1999). The Role of Ethical Leadership in Organizational Performance. Retrieved from
www.lindaferrell.com
Ferrell, D. L. (1999, March). The Role of Ethical Leadership in Organizational Performance. Retrieved
from http://lindaferrell.com/lead.html
Heres, L. &. (2010). ETHICAL LEADERSHIP. Amsterdam, The Netherlands: Research group Integrity of
Governance.
Mihelic, K. (2010). Ethical Leadership. (N. 5. Volume 14, Ed.) International Journal of Management &
Information Systems , 14.
Sharma, R. K. (2014). Leadership. Kathmandu.
Carter, R. (2012). The Leadership.
Principles of Ethical Leadership. (2012).
Sharma, D. K. (2014, December). Leadership. Kathmandu, Nepal.

Suraj Prasad Simkhada