The Normative Foundations of Ethical Leadership

Korkiat Mahaveerachartkul National Institute of Development Administration

Although the ethical leadership of Brown, Trevi�o, and Harrison (2005) has been extensively studied as an antecedent of positively affective, cognitive and behavioral outcomes in different organizational levels, a shortcoming of the construct, the lack of an explicit normative grounding, has not been broadly addressed yet. Consequently, this study aimed to identify the normative foundations of the ethical leadership by analyzing the construct (i.e., its characteristics, definition, scale, and other related constructs) from a normative perspective. The analysis revealed that its normative foundations might be some parts of deontology (e.g., right to dignity, right to autonomy, procedural justice, distributional justice, and retributive justice), virtue ethics, utilitarianism, care ethics and relativism. Future research studies are suggested to find more evidence to verify whether the other part of deontology (e.g., right to privacy, right to property, and compensatory justice) can be normative foundations of the ethical leadership. In addition, to attain additional definite results, the same and different groups of ethical theories are encouraged to be employed to analyze the ethical leadership.

Keyword: ethical leadership, ethical theory, normative foundations Current global issues in the news have raises the concerns over not only the leaders’

abilities and inabilities but also the leaders’ ethics and genuineness to manage difficulties or crisis. These issues have also raised the questions to all leaders not only what but how organizations’ goals should be achieved (Treviño, Brown & Hartman, 2003), as well as whether and how leaders can shape ethical behavior in the workplace (Brown et al., 2005).

Following these concerns, several theories and research have been studied and conducted to explain this phenomenon. It has been supported that employees learned ethical standard in their organization by observing ethical actions of significant persons (e.g., leaders or superiors) (Brown et al., 2005; Treviño, 1986). In addition, ethical behaviors cascaded from

one organization level to the next (i.e., top managers, to supervisors, and to employees) (Mayer, Kuenzi, Greenbaum, Bardes, & Salvador, 2009).

Because of its importance in the business world, ethics of leaders have been conceptualized in various forms of leadership, such as moral leadership, a construct of paternalistic leadership (Cheng, Chou, & Farh, 2000), or idealized influence, a construct of transformational leadership (Bass & Avolio, 2000). However, among prominent constructs of leaders’ ethics, the ethical leadership developed by Brown and his colleagues (2005) is outstanding because the majority of empirical studies of ethical leadership utilized ethical leadership scale by Brown et al. (2005) and the construct has been studied in several countries, such as North America (e.g., U.S. and Canada), Europe (e.g. Netherlands, Spain and Germany), and Asia (e.g., China, Malaysia, and Singapore) (Eisenbeiss, 2012; Ng & Feldman, 2015). However, the study of Brown and his colleagues (2005), based on a social scientific approach rooted in the discipline of psychology, lacks an explicit foundation of normative theories of ethical behavior (Ünal, Warren, & Chen, 2012); it can be questionable whether this concept is in line with a normative approach to business ethics.

Following the previous literature and question, the purpose of this article is to review literature that is relevant to the concept of the ethical leadership by Brown et al. (2005), to analyze such concept from a normative perspective and specify normative foundations of the construct, and finally, to provide areas for future studies. Ethical Leadership

Ethical leadership is a topic that has long been considered from the normative approach to business ethics (i.e., the prescription rooted in philosophy for how a person ought or should conduct themselves in an organization), but the study of this topic in the descriptive (social scientific) approach, rooted in psychology, sociology, or organization science, etc., is relatively new (Brown & Mitchell, 2010). This section suggests the ethical leadership construct, which is one of the descriptive-approach studies, by Brown and his colleagues (2005), as well as its characteristics, its related constructs and its work outcomes. The Origin and Definition of Ethical Leadership

It is undeniable that the qualitative studies of Treviño, Hartman, and Brown (2000) and Treviño et al. (2003) provided unique characteristics of moral leadership and influenced the formation of ethical leadership definition of Brown et al. (2005). In summary, ethical leadership can be viewed in two dimensions. First is the moral person who demonstrates positive traits (e.g., integrity, honesty, courage, sincerity, credibility and trustworthiness) and positive behaviors (e.g., doing the right thing, showing concerns for people, being approachable and a

good listener, and having high personal morality), and makes decisions based on a reliable set of ethical values and concerns about people and the broader society. The second is the moral manager who is people-oriented, concerns for multiple stakeholders, does not compromise ethical standards, acts as a role model emphasizing visible ethical actions, explains ethics and values clearly enough to guide subordinates’ important decisions and actions, and provides rewards and punishment effectively to give clear indication of desirable and undesirable behaviors. L ater, Brown et al. (2005) used social learning theory (Bandura, 1977, 1986) as a theoretical framework of their ethical leadership. According to Brown et al. (2005), Brown and Treviño (2006), and Brown and Mitchell (2010), social learning theory refers to the concept that human being learns standard of proper conducts by observing how attractive, legitimate and credible role models (e.g., teachers, parents, or supervisors) behave or what values and attitudes that such models hold. In addition, almost all behaviors that one learns from direct experience can also be learned vicariously (e.g., observing behaviors and outcomes of others). Accordingly, leaders are an essential and potential source of ethically modeling due to their power (e.g., the ability to control rewards or punishments towards ethical and unethical conducts) and status (e.g., the high standing in an organization that inevitably draws followers’ attention towards their moral and immoral behaviors). Consequently, leaders can create the ethical culture in the workplace by firstly conducting virtuous actions towards their positions or statuses and then using their power justly to affect the behaviors and consequences of followers.

Based on the previous studies of Treviño et al. (2000, 2003) and social learning theory, Brown et al. (2005) defined ethical leadership as “the demonstration of normatively appropriate conduct through personal actions and interpersonal relationships, and the promotion of such conduct to followers through two-way communication, reinforcement, and decision-making” (p. 120). Following this constitutive definition, there are four main important components. First, the leaders who are regarded as ethical role models must behave in the way that is normative appropriate in the eyes of followers (e.g., honesty, trustworthiness, openness, fairness and care). In addition, Brown et al. (2005) intentionally make the term “normatively appropriate” ambiguous to stress that what is believed or considered to be appropriate differs from context to context. Second, ethical leaders have to promote and make ethics outstanding in the organizational environment by talking to employees about it and listening to their opinions with a practically unbiased process. Third, ethical leaders develop ethical standards, which include the measures to reward those who conduct ethical behaviors, as well as to regulate or punish

unethical conduct. Fourth, ethical leaders make fair decisions that can be perceived and followed by others, as well as pay attention to ethical consequences of their decisions. Ethical Leadership and its Related Constructs

Within their seven interconnecting studies, Brown et al. (2005) developed the Ethical Leadership Scale (ELS), a 10-item questionnaire that measure perceived ethical leadership of individuals. Ethical leadership has been found positively associated with various kinds of leadership, such as all components of transformational leadership (i.e., idealized influences, individualized consideration, inspirational motivation, and intellectual stimulation), contingent rewards and leader-member exchange, but negatively related with management-by-exception, laissez-faire and destructive leadership (Brown et al., 2005; Sutherland, 2010; Toor & Ofori, 2009). Although ethical leadership is partially overlapping with other leadership constructs, under confirmatory factor analysis, it is obvious that ethical leadership is distinct from any of those (Brown et al., 2005).

Ethical leadership brings several benefits in the individual level. It has been found that ethical leadership created ethical climate, impressed positive leader’s characteristics on employees (i.e., interactional fairness, trust in leaders, leaders’ effectiveness), predicted employee’s positive personal characters (i.e., self-efficacy, dedication and accountability), positive work attitude (i.e., job satisfaction, psychological well-being, affective and normative organizational commitment, and organizational identification), positive work behavior (i.e., voice behavior, organizational citizenship behavior in individual and organizational levels), and task performance, as well as predicted low level of employees’ negative outcome (i.e., work related stress, counterproductive work behavior, and turnover intention) (Avey, Palanski, & Walumbwa, 2011; Avey, Wernsing, Palanski, 2012; Brown et al., 2005; Elci, Sener, Aksoy, & Alpkan, 2012; Hoffman et al., 2013; Neubert, Carlson, Kacmar, Roberts, & Chonko, 2009; Neubert, Wu, & Robert, 2013; Yang & Liu, 2014).

The benefits of the ethical leadership are not limited to the individual level. As regards the group level, ethical leadership predicted team conscientiousness, team job motivation, team organizational citizenship behavior, team voice, and team task performance, as well as predicted low level of group deviance and group relationship conflict (Brown et al., 2005; Detert, Treviño, Burris, & Andiappan, 2007; Mayer, Aquino, Greenbaum, & Kuenzi, 2012; Mayer et al., 2009; Rubin, Dierdorff, & Brown, 2010; Walumbwa & Schaubroeck, 2009; Walumbwa et al., 2012). With regard to the organizational level, Kim and Brymer (2011) found that the ethical leadership predicted firm’s competitive performance.

The Analysis of the Ethical Leadership from the Normative Perspective

According to Brown and Mitchell (2010), when using the normative approach to ethical leadership study, scholars adopt particular philosophical frameworks to describe what leaders ought or should behave, to examine decision making of leaders, and to consider the extent to which particular types of leadership are ethical. This section uses ethical theories based on philosophy, such as deontology and utilitarianism, to analyze the ethical leadership construct of Brown et al. (2005) in order to identify the extent to which the construct fits each ethical theory.

According to Ünal et al. (2012), deontological theories that are examined in the business ethics literature involve two main parts, which are rights (e.g., right to dignity, right to autonomy, right to safety, right to privacy, and right to property) and justice (e.g., procedural justice, distributive justice, retributive justice, and compensatory justice).

The ethical leadership might be directly compatible with right to dignity and right to autonomy. It is obviously shown in the characteristics (e.g., respecting people and open communicators), the ELS (e.g., “listens to what employees have to say”), and the employees’ outcome (e.g., voice behavior). In addition, treating people well, doing the right thing, honesty and trustworthiness, and the ELS “discuss business ethics or values with employees” might support right to safety, privacy, and property. However, the evidence is not definitive, nor directly enough to suggest that those latter rights underlay the ethical leadership.

The ethical leadership might be compatible with procedural, distributive and retributive justice as illustrated in the characteristics (e.g., setting expectations and rules, making decisions based on a reliable set of ethical values, using rewards and punishments), the definition (e.g. providing reinforcement and punishment to promote ethical behaviors), the ELS (e.g., “disciplines employees who violate ethical standards”, “makes fair and balanced decisions” and “sets an example of how to do things the right way in terms of ethics”), as well as the ethical leadership’s outcomes (e.g., interactional fairness and trust in leader). Nevertheless, there is not sufficient indication of the relationship between the ethical leadership and compensatory justice.

According to Ünal et al. (2012), one who pursued virtue ethics used reasoning to cultivate desired virtue, utilized these virtues in all circumstances, and avoided any action that harms virtues. The leaders who pursue such ethics should demonstrate good characters, such as displaying trustworthiness and honesty, pursuing a prosperous life, following the organization rules, and striving for excellence in all domain of life.

The concept of the ethical leadership might be consistent with virtues ethics. For instance, its characteristics and definition focused on the normative appropriate conducts of

leaders, such as honesty, trustworthiness, integrity, fairness, and care. In addition, the ELS is composed of the items that reflected moral virtue ethics, such as “conducts his/her personal life in an ethical manner” and “can be trusted.” Moreover, the antecedents of the ethical leadership, such as moral reasoning (Brown & Treviño, 2006), moral identity (Mayer et al., 2012), social responsibility (De Hoogh & Den Hartog, 2008), and emotional stability (Kalshoven, Den Hartog, & De Hoogh, 2011) revealed some components of virtue ethics.

According to Russ-Eft (2014), utilitarianism addresses the importance of the consequence of the action (e.g., decisions) that lead to the general good. In other words, utilitarianism relates to the decision or the consequence that creates the greatest good or the greatest happiness for the greatest number of people, and the happiness of each individual are equal (Ünal et al., 2012). In the pursuit of utilitarianism, leaders utilize their power not to serve their own interests or their own group but the organization goals.

The ethical leadership might support utilitarianism as shown directly in its characteristics, such as concerning about multiple stakeholder perspectives (e.g., employees, suppliers and customers), concerning about process, not just outcomes, concerning about the long-term goals, not just the short-term goals, and concerning about the bottom line, not just self-centered), as well as indirectly in its scale (e.g., “define success not just by results but also the way that they are obtained”).

According to Russ-Eft (2014) arising from women concerning with taking care of children and people who are ill and the natural capacity of human for empathy, cares ethics suggests the capacity to be aware of the needs of others, as well as to adjust one’s action in line with or to respond to those needs. According to the literature review, the characteristics (e.g., being people oriented, caring about people, and treating people right), the construct (e.g. care is a part of normatively appropriate conduct to follower), the ELS (e.g., “has the best interests of employees in mind”), the antecedents (e.g., concern for others; De Hoogh & Den Hartog, 2008), and the consequences (e.g., employee voice; Avey et al., 2012) of the ethical leadership might reflect the pursuit of care ethics.

According to Russ-Eft (2014), ethical relativism suggests that there is no one truth or ethic that can apply to all cultures or societies and what is right or wrong relies on personal or societal judgments. This ethical approach does not imply that one should indubitably follow one’s own culture but suggests that the decisions or judgments of one society may or may not be appropriate for others. The ethical leadership might correspond to the ethical relativism as Brown et al. (2005) stressed in the definition that contexts played an important role in the consideration of what appropriate behaviors are, as well as in the ELS, such as “When making

decisions, asks “what is the right thing to do?”, which allows participants to consider what the right thing is in a specific context. For instance, publicly speaking out in one context might be regarded as self-assertiveness; however, the same action might be seen as arrogance or aggressiveness in the other cultures.

According to Regis (1980), ethical egoism refers to “the view which holds both that one ought to pursue one's well-being and happiness, and that one has no unchosen moral obligation or duty to serve the interests of others” (p.61). In this context, it suggests that one can pursue one’s own interest so long as one does not disturb the interest of others. The ethical leadership might not be aligned with ethical egoism as shown in the characteristics of ethically neutral leadership, a contrasting category of the ethical leadership, which demonstrated being more self-centered, uncaring about people, and focusing mainly on the bottom line. The summary of the ethical theories that might be the normative foundations of the ethical leadership is presented in Table1. Discussions and Future Studies

Based on the literature review and the analysis, there are four issues about the ethical leadership construct of Brown et al. (2005) that are worth careful consideration. First, although the ethical leadership concept seems practical because of its several positive consequences towards all levels in organizations, it can be doubtful that the leader based on the ethical leadership is really ethical. When ELS is carefully considered, it is found that the items seem to represent the leaders who act virtuously, justly, and ethically, as well as have a just and practical process to communicate ethics with followers. However, ‘act’ and ‘be’ are different. In this regards, Mayer et al. (2012) found that moral identity symbolization (i.e., the demonstration of one’s moral traits through moral actions, such as religiosity or charitable giving) was not directly related to group unethical behavior and group relationship conflict; on the other hand, moral identity internalization (i.e., moral traits that are embedded in one’s self-concept which can be expressed by, for instance, avoiding of behaviors that are considered as immoral which would challenge one’s self-concept, or focusing on correcting, and punishing unethical behaviors) was negatively related to this two outcomes. In addition, symbolization seemed to be related to the ethical leadership while the relationships between internalization were not consistent. According to the results, the existing ELS tends to be symbolization more than identification. Following the work of Mayer et al. (2012) which studied moral identity into two dimension, future research might focus on the examination of the differences between leaders who acts as ethical leaders and leaders who are ethical leaders. Are they related constructs? Is

it possible that leaders who act ethically are not ethically institutionalized and vice versa? And which type of leaders can predict higher positive outcomes?

Second, there is a consistency in the transformation from the characteristics of ethical leadership and social learning theory to the ethical leadership construct and scale. Although several characteristics’ details could not be included in the construct and measurement during the conceptualization process, it was found that the same set of ethical theories (i.e., right to dignity, right to autonomy, procedural justice, distributional justice, retributive justice, virtue theory, utilitarianism, care ethics and relativism) which supports the ethical leadership characteristics can also explain the ethical leadership definition and measurement. However, as shown in the last column of Table 1, the empirical study of the relationship between the ethical leadership and some ethical theories remains unexplored. It would be more definitive if the social empirical results would support the outcomes of the normative approach.

Third, although the construct and the scale of the ethical leadership seem in line with some ethical theories, it fails to clearly address several important components of business ethics, such as right to autonomy, right to safety, right to privacy, right to property, and compensatory justice which are commonly related to ethical dilemmas in the business world as suggested by Ünal et al. (2012). This does not mean that the ethical leadership is not in line with those ethical theories but means that empirical studies about these issues have not been obviously conducted and there is more room for further research. If future normative studies find no relationship between the ethical leadership and those ethics, some refinement or expansion of the definition and the instrument based on normative ethical theories, following some factor analysis, might be an interesting proposal.

Fourth, based on interpretivist paradigm, it would be beneficial if future research investigates the construct by employing the same ethical theories as did this article. The similarities and differences between the interpretation of this article and future articles would provide a clearer picture of what exact ethical theories underlie the ethical leadership. to analyze the construct, future research should also use other normative ethical theories apart from the ones have been used in this study, for instance, religion (e.g., Christianity, Muslim, and Buddhism), Western philosophy (e.g., social contract theory or divine command theory), Eastern philosophy (e.g., Taoism or Confucianism), or an interdisciplinary integrative approach which consider Western and Eastern moral philosophy, and ethical theories of religions (see Eisenbeiss, 2012).

In conclusion, the importance of leaders as a role model in shaping ethical conducts in the workplace has been widely recognized. This study accentuates the value of the utilization of

the normative ethical theories in the development and the investigation of ethical leadership constructs of Brown et al. (2005). The analysis of this study make implicit ethical theories underlying the ethical leadership more explicit. Based on the analysis, it was found that the normative grounding in the ethical leadership might right to dignity, virtue ethics, utilitarianism, care ethics and relativism; however, egoism is contradiction to the ethical leadership. It is suggested that the ethical leadership construct should be studied in terms of ‘being ethical’, as well as ‘acting ethically’. In addition, the area that are needed to further investigate is whether deontological theories (e.g., right to privacy, right to property, or compensatory justice) can be a normative grounding in the ethical leadership. The ethical leadership should also be further investigated in various contexts with the collaboration between empirically social scientific and normative approaches (Eisenbeiss, 2012).

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Table 1

The Summary of the Analysis of the Ethical Leadership from the Normative Perspective

Ethical Theories Ethical Leadership

Characteristics Definition Scale Correlation

Deontology - Right to Dignity + + + + - Right to autonomy + + + + - Right to safety nd nd nd + - Right to privacy nd nd nd nd - Right to property nd nd nd nd - Procedural justice + + + + - Distributive justice + + + + - Retributive justice + + + nd - Compensatory justice nd nd nd nd Virtue ethics + + + +

Utilitarianism + + + + Care ethics + + + + Relativism + + + + Egoism - - - -

Note. + = there is sufficient evidence of the dimension to support that the ethical theory underlies the ethical leadership; - = there is sufficient evidence of the dimension to support that the ethical theory is contradict to the ethical leadership; nd = the evidence was not definitive to suggest that the ethical theory underlies the ethical leadership.