Ethical Leadership

A lot has been said about the leadership, its styles, how to incorporate etc. However, there is another side attached to these leadership styles which is called ethical leadership. “Ethical leadership is knowing your core values and having the courage to live them in all parts of your life in service of the common good” (Grace, 2006).

Ethical leadership comprises of two parts, “First, ethical leaders must act and make decisions ethically, as must ethical people in general. But, secondly, ethical leaders must also lead ethically – in the ways they should treat people in everyday interaction, in their attitudes, in the ways they encourage, and in the directions in which they steer their organizations or institutions or initiatives”. (Rabinowitz, 2013).

Vision and mission statements are generally associated with ethical leadership. “Vision provides the overall reference of what the organisation would like to reach and how it will look. Within this vision the mission statement defines what the organisation aims to acheive” (Mullins, 2013:665).

The 4-V model of ethical leadership is a framework which associates four attributes necessary for an ethical leadership. It can be regarded as a checklist for this leadership. They are:-

  •          Values: Values should be first discovered as a basic identity of a leadership. It should be integrated along with the choice-making on personal and professional level.
  •          Vision: is the overall picture of where an organisation will heed to. It provides a driving force behind the formulation of the strategy.
  •          Voice: is the essential of any leadership. All the ideals should be clearly communicated to the employees in order to go through a smooth operation.
  •          Virtue: is all to do with good ethics. Practicing vitreous behaviour instils the basic good character. Virtue can be said as a foundation of an ethical leadership (Gracy, 2006).

Should ethical leadership be practiced? Is it useful for an organisation? These have become the topics of most debates. For this, we’ll consider the benefits of ethical leadership and an example of going too far in unethical behaviour.


Benefits of ethical leadership:

  •          Corporate Social Responsibility (CSR) is a way in which an organisation can pay back to the society. Doing this not only helps the society but builds a good reputation for the organisation.
  •          Ethical organisations strike a good rapport with the customers and the stakeholders. A strong trust develops between them which is prospective from the business point of view.
  •          Greater trust and longevity are generally associated with the ethical leadership run organisations. More and more people tend to associate themselves with an organisation which has a good image.
  •          As a result profit level and customer count increases which gives a boost to the organisation.
  •          Sets out a good example within the corporate world. Other managers and organisations can learn a lesson form an ethically lead organisation.

(Mikulin, 2009).

Inspite of all the good values associated with the ethical way of business, some organisations tend to be un-ethical in order to maximise their profits. They do succeed in doing so but the charm is only short lived. A bit of unethical behaviour could still be tolerated but going way to far can prove costly.

One such example is of Enron which went bankrupt due to its un- ethical behaviour.  “Its shoddy business practices, aided by bankers and advisors feeding from the gravy train, brought down the company in December 2001.” (Silverstein, 2013). This is a best example of a company which was quite far prom practicing ethical behaviour. At the end it was the company that bear the brunt not forgetting their stakeholders. “Unethical companies will eventually get exposed: Witness Enron. Companies that live and breathe their missions, by contrast, will get recognized by both the retail and capital markets. But solid principles are good for business, and ultimately good for corporation valuations” (Silverstein, 2013).

Ethical leadership could hence be said as a long and sustainable way of doing business. The pace of making profits might initially seem slow but is sustainable. Ethical way of doing business not only helps in increase of customers or stakeholders, but also gets renowned for its honest image. Starbucks for example started a joint venture with TATA- a company known for its values, to start their business in India. Mr. Schultz CEO of Starbucks was quite moved by the ethical leadership of Ratan Tata, head of TATA. “Mr Schultz said his company has developed an incredible relationship with TATA and he could not imagine bringing Starbucks to India without Ratan Tata’s assistance” (NDTV, 2013). This shows the level of trust gained by the ethical leaders in the corporate world.


Grace, B. (2006) Ethical leadership, [Online], Available: [2014].


Mikulin, R. (2009) The Benefits of Running a Socially Responsible and Ethical Company, 11 Nov, [Online], Available: [2014].


NDTV (2013) Ratan Tata’s grace and wisdom moved me: Starbucks CEO, 19 Nov, [Online], Available: [2014].


Silverstein, K. (2013) Enron, Ethics And Today’s Corporate Values, 14 May, [Online], Available: [2014].


Mullins, L.J. (2013) Management & Organisational Behaviour, 10th edition, Harlow: Pearson Education




Managing Change

“Change is an inevitable and constant feature. It is an inescapable part of both social and organisational life and we are all subject to continual change of one form to another” (Mullins, 2013:711). As the author says, change happens everywhere. Every organisation is subjected to change at one point or the other as change leads to progression.

Before we dive deep down the issue, one must understand as to why change occurs? What are the forces behind it? “Some of the factors as listed by Mullins are as follows:-

  •          Uncertain economic conditions.
  •          Fierce competition due to globalisation.
  •          Vested political interests.
  •          Induction of new technologies.
  •          Changing nature of workforce.
  •          Internal conflicts within an organisation”. (Mullins, 2013:711).

Change can be primarily categorised into planned and emergent. Planned change was first coined by Kurt Lewis to distinguish it from the emergent changes. Lewis identified three phases of planned change viz

  •          Unfreezing: – minimising the present behaviour, incorporating the need for change and the improvement required.
  •          Movement: – Developing new behaviour and implementing the change.
  •          Refreezing: – Stabilizing the change & incorporating policies and norms.

(Mullins, 2013:714).

Emergent change on the other hand “based on the assumption that change is a continuous and unpredictable process of aligning and realigning an organisation to the changing environment” (Burnes 2010).

“Change is nothing new and a simple fact of life. Some people actively thrive on new challenges and constant change, while others prefer the comfort of the status quo and strongly resist any change. It is all down to the personality of the individual and there is little management can do about resistance to change”. (Mullins, 2013). Change is always met with resistance and criticism. Individuals to organisations, everybody opposes change at the first place.

One of the key roles of management is to understand the reasons behind the resistance. Maslow’s hierarchy of needs best depicts the psychology of an individual. It basically classifies the needs in the form of a pyramid ranging from higher to lower needs. Implementing it during change process can help defend resistance.

Management can do a lot in reducing the resistance towards change. “Some of the key steps for successful large-scale change prescribed by Kotter and Cohen as quoted by Mullins are as follows:-

  •          Create a sense of urgency among the people concerned with the change.
  •          Create visions which are clear and precise. Visions must be in sync with the strategy of the organisation.
  •          Communicate with the change affected people of the organisation regarding the strategy and the vision.
  •          Empower action and remove obstacles which hinder the change process among the people.
  •          Implement short term incentives that give credibility and provide motivation to the overall effort.
  •          Make change stick by growing the culture and developing group norms and policies. (Mullins, 2013:718).

An effective change management can be best illustrated during the change management process of J.C.Penny. This organisation was baffled by the authoritarian style of leadership and had practices which hindered the productivity of the employees. Myron E.Ullman initiated a change process in a tactful manner. As a result it was met with far less criticism as supposed to be. The change process proved effective for both the individuals and the organisation as whole. The effective change process steered the company towards more profits. (Purkayastha, 2007).

As illustrated above, change can be brought in effective if it is implemented in the right fashion. Change should be incorporated under proper leadership. From the above example, it can be noted that Ullman adopted participative style of leadership where he took his fellow employees in confidence and brushed aside their fears regarding change. This is the key ingredient for a good leadership which foresees a change. Such type of change even sustains a longer period as it has firm foundations.

Therefore, I say that Leadership plays a vital role in sustain a change. Resisting change is but obvious for any individual or an organisation but it can be ward off through a good leadership style. Understanding the forces behind a resistance and the ways to tackle them is a fundamental aspect when incorporating change. These are the common basics while implementing a change for both an individual and an organisation.



Burnes, B. (2009) Managing Change, 5th edition, Essex: Pearson Education Limited.


D., P. (2007) ICMR, [Online], Available: [2014].


Mullins, L.J. (2013) Management & Organisational Behaviour, 10th edition, Harlow: Pearson Education.






Leadership and Mangement

The words, leadership and management face a lot of confusion in today’s world. Most of the people don’t know the exact difference between the two.

As said by Mullins, “Management is about changing behaviour and making things happen. It is about developing people, working with them, reaching objectives and achieving results.” (Mullins 2013:421). Whereas on the other hand, “Leadership is a relationship through which one person influences as the behaviour or actions of other people.” (Mullins 2013:369).

The constant change in the working environment of an organisation demands more leadership qualities at the high level. “Effective leadership is a two way process that influences both individual and organisational performance. Leadership is related to motivation and interpersonal behaviour.” (Mullins 2013:369).  Gone are the days when leadership was associated with command and control, these days it has lot to do with inspiration, vision and team-working.

Some of the key aspects which differentiate between leaders and managers as per key researches are:

  •          “Managers do things right whereas leaders do the right things”. (Mullins 2013)
  •          Management is an authoritative relationship whereas leading is an influential relationship.
  •          Management creates stability within an organisation while leadership creates change within the individuals as well as the organisation.

One should know different leadership styles in order to understand better. In 1939, a group of researchers led by psychologist Kurt Lewin set out to identify different styles of leadership (Cherry, 2012). This early study leads to the establishment of three major leadership styles which could be classified further. The three leadership styles are as discussed below:

Authoritarian leadership:

This type of leadership defines a clear line between the leader and the employees. These autocratic leaders lay down specific instructions for a particular task without taking in any consultation. The decisions are made independently without the group work or consultation from the employees. Such type of leadership lack any creativity and innovation at work. This type of leadership is usually looked down upon as something quite negative in nature. Authoritarian leadership only works when the leader is quite knowledgeable about a particular task. (Cherry, 2012)

Democratic leader

Participative or democratic leadership was found to be most efficient by Lewin. Leaders in this category were found to participate in the group, take inputs and offer guidance to the employees. Employees lead by a democratic leader were found to be more engaged, motivated and productive for work.

Laissez-Faire Leadership

Laissez-Faire leadership also known as delegative leadership offer negligible instructions to their subordinates. As a result the employees under this type of leadership are the least productive as they are sometimes clueless about the work. They even tend to loose their interest and motivation for the work. These leaders leave the decision making process to the employees themselves. Delegative leadership can only be efficient if the group members are highly experienced and qualified else It proves to be quite catastrophic if the case is other way round. (Cherry, 2012).


Having argued about both the pros and cons of the three main leadership styles, it could be said that the best leader is the one who changes his leadership style as per the situation. “The best approach may vary according to circumstances and individual characterstics” (CMI, 2013). This is rightly said depending upon the criticality of the finance sector and the diverse teams involved in an organisation. A best leader is one who understands his employees and tailor his leadership as per the employee and the situation.

As a member of a team, I would like myself to be lead by a democratic leader. Very less negative stigma is attached to this type of leadership. Under a democratic leader I would feel more free to express myself and participate in the group. Democratic leadership is a two way process of give and take. It is this openness which I like about. A democratic or participative leader is quite engaging and motivating as well. Motivation forms a key criterion in the difficult and stressful life in the finance sector. All these just adds to the advantages of having lead by a participative/ democratic leader.


Take out any world class leading organisation and you’ll come to know that they are not managed by managers but instead leaders who have a clear vision. Bill Gates, Steve Jobs, Michael Dell are just some of the examples of great leaders in the corporate world. Life has never been the same after the demise of Steve Jobs. Leadership is quite a complex phenomenon. A person can be trained easily to become a manager but not a true leader.



Cherry, K. (2012) Lewin’s Leadership Styles, [Online], Available: [2014].

CMI (2012) Understanding Management Styles, Jan, [Online], Available: [2014].

Mullins, L.J. (2013) Management & Organisational Behaviour, 10th edition, Harlow: Pearson Education.








Diverse Teams Produce Better results If Well Led

Globalization has eased the mass migration of people from across the world in the pursuit of jobs and other businesses. As a result the world has turned into a global village where you find people of different cultures working under same roof. Diversity has never been recognised so widely in past as it is now. Today’s corporations are structured in a way wherein the groups are expected to find solutions to the most complex business issues. These groups tend to be quite diverse in nature and bring in all sorts of ideas and innovations into business mainstream.

“Diversity is about differences in ethnic origin, age, gender, disability, family status, education, social or cultural backgrounds – in fact anything which may affect workplace relationships and achievements” (Mullins, 2013). Managing a diverse team is of the main challenges which a typical manager faces in the finance industry. Dan Tennebaum , Managing Director of India Capital as quoted by Dorie Clark gives a good reasoning behind employing a diverse team. He says that “What we’ve tried to do is to give ourselves as many angles as possible to look out at a company” (Clark, 2012). This shows the various levels of thinking, ideas and innovations attached to a diverse team. This gives a good boost to the productivity and enhancement of various financial services.

As every aspect has its pros and cons, so is the case with diverse teams. Tennebaum as quoted by Clark says that “There are a diversity of opinions, and sometimes there are ten different answers to a simple question. There can even be simple cultural misunderstandings.” (Clark, 2012). In most cases noticed by researchers, different types of diversity create varied types of conflicts which leave a huge dent on the team’s performance. As noted by a renowned academician Margaret Neale, “The kind of group conflict that exists and how the team handles the conflict will determine whether this diversity is effective in increasing or reducing performance.” (Unknown,1999).  She further stresses that in most cases “Diversity creates social divisions, which in turn create negative performance outcomes for the group.” (Elizabeth Mannix, 2005).  Further research shows that goals and value based diversity is among the most destructive, even more than the demographic one which was previously presumed.

A manger can prove to be quite instrumental in utilizing the assets of his team. A proper leadership style could suppress conflicts arising within the teams over petty issues. A manager has the same role as a captain of the ship who is in charge of steering his ship from any mishap. It is the duty of a manager to understand the personality of all his team mates and assign them work in which they are productive of. Interference should be minimized at the first step in order to reduce any arising conflicts.


One of the important theories to look upon as a manager is that of Professor Geert Hofstede. He says that “Culture is the collective programming of the mind distinguishing the members of one group or category of people from others” (Hofstede, 2013). His research encompasses more than hundred thousand employees from 40 countries and concluded his model after forming four groups.

In order to successfully manage a diverse team, a manager is supposed to follow some key steps as stressed by Ebokosia.

  •          “Managers need to adjust their management and coaching style to work with different employees.” (Ebokosia, 2012).
  •           Managers also need to custom their leadership style based upon the individual’s personality. This can be illustrated by a following quote “One shoe doesn’t fit all.”
  •          Be a good listener. A good manager is one who first listens, understands and tries to find a way out. An authoritarian manager can never lead any team successfully.
  •          Engage low performers. A good manager should understand that not all employees are of the same calibre. One should boost the morale of low performers by giving good feedback, seeking out solutions together, etc. (Ebokosia, 2012).


On a concluding note, I would like to stress that diverse teams in an organisation can prove to be an asset provided they are lead by an able leader. Diverse teams if well lead can boost the productivity of an organisation. On the other hand they can even prove to be quite disastrous due to arising conflicts and problems. Due to the sensitivity of the finance sector, a manager is expected to take his team along towards a common goal thereby avoiding any catastrophic consequences.



Clark, D. (2012) Want Better Results ? Hire a Diverse Team, 08 Oct, [Online], Available: [2014].


Ebokosia, A.A. (2012) Multiple Personalities: How to lead a Diverse Team to a Common Goal, 10 Oct, [Online], Available: [2014].


Elizabeth Mannix, M.A.N. (2005) ‘Sage journals’, What Differences make a Difference ?, vol. 6, Oct, Available: [2014].

Hofstede (2013) National Cultural Dimensions, [Online], Available: [2014].


Mullins, L.J. (2013) Management & Organisational Behaviour, 10th edition, Harlow: Pearson Education.


Unknown (1999) Diversity and Work Group Performance, 1 Nov, [Online], Available: [2014].