Chapter 3 Ethical Challanges in the

Leader-Follower Relationship
Gaspar Giacomini
Leadership is a process
Person State
1
2
3 4
5
Process
Leadership
X X
V
There are ethical challanges on the path
Hodkdkinson (1993):
instrinsically
valuational;
philosophy-in-action
Leader-Follower Relationship
A major element of
Leaders perception of
himself/herself is
relative to followers,
and how they, in turn,
perceive the leader.
Power over others
Power over others:
hurting people is usually
not the way to get the
best from them.

Abuse deprive the leader
of honest information and
judgments from
subordinates.

60-75% respondents
reported their supervisor
as the worst aspect of the
job.
Disfunctional systems
Roger Smith: lead the
decline of 20 points on
GMs market share
between 1981 and 1990...
But still got a raise on his
pension to U$1 M/year.
Followership
Charisma and its effects
Max Weber Sigmund Freud
Followership is
shared ego-ideals.
Followership are
drawn by leader
special qualities.
Charisma is not an unmixed good
We need to distinguish
between ethical and
unethical charisma leaders
Contrast between power and identification
Knips (1976): 4 corrupting
influences of power:
1) Power as and end in itself
2) Agency theory
3) Exalts self-worth sense
4) Devaluation of others

Power Distance
Moulder (1981): desire to
avoid close contact deightens
the gap between leaders and
followers.

But the Gap will be smaller
where process of identification
and sharing occur.

Mutual identification motif
Joining or distancing followers
Thomas Usher
US Steel CEO

He visited the companys largest mill
in Indiana and told union members:
our long-term interests are the
same...

Joining or distancing followers
High bonus to CEOs may
allienate followers from
leaders.

Japan 17 x
France 23x
America 100x

Leadership is performance
Peter Drucker

What earns a favorable judgment on
a leaders perfornamce?
Success in achieving goals.

Positive and negative outcomes are
more likely to be attributed to the
leader.

Leader characteristics have and
effect on followers by shaping their
perceptions and responses.

Chapter 7 Explaining Ethical Failures of
Leadership
Gaspar Giacomini e Thamy Echigo
Cognitive challenges
When ethical failure of leadership is exposed, we are
inclined to look for an explanation of the leaders
behaviour, not an analysis of the moral status of what was
done.
Why do
they did
it?
Cardinal Bernard Law
Leaders have reasons to believe that they are not bound by
the requirements of morality.
Volitional accounts of ethical failures
The most basic assumption: human behavior is egoistic.
Moraly competes not with ignorance but with self-interest
Society creates mechanisms for making sure self-interest
meets the requirements of morality.
But the by-products of success can strain the leaders ties
to morality.
It seems that leadership does not affect changes in the way
that leaders think about morality.
Mistakes: content x scope
Mistakes of Content
indexed to beliefs about the moral status of actions
(good/bad).
May be indexed to failure to see why some actions are
wrong (ignorance of features that make them wrong).
Ex. Native Brazilians (ndios) rituals.


Mistakes of Scope
indexed to beliefs about the moral status of individuals
They are errors of application of moralitys structures
Ex. Does WalMart has any moral obligation with small
local stores?


The Moral Psychology of Exception Making
Leadership bounded up with the notion of exception making.
Justification: undermining factors actors behaviour falls
out the scope of the requirement exception making
Excuse: the actor is no less bound by the requirement.
Leadership has moved itself out of the general normative
scope.
Higher disparities between leaders and others, higher
probability to leaders see themselves out of scope and
morality.
Challenge: clarify and precision to the justificatory force of
leadership set of reason that legitimates exception.
The justificatory force of leadership
Technically good x morally good conflict between ethical
and effectiveness norms
Push them together
Ciullas: definitions of leadership have normative
implications embodiment of group goals and interests
Commitment with collective goals can promote ethical
failures of leadership
Are leaders circumstances different from the circumstances
on the norms were typically based? (how exceptional we
classify them?)
Leaders can work from the perspective of values that the
followers might reject.

Exceptions Leaders make
To serve others
Chapter 8 The Trouble with
Transformational Leadership: Toward a
Federalist Ethic for Organizations

Thamy Echigo, Guilherme Caetano
After the American War of Independence, James Madison concluded that a
key problem in designing a system of government was how to manage
factional tensions, given the readiness of groups to pursue their own
interests at others expenses.

Two hundred years later this is still a key problem in the management of
governments, corporations, and organizations of all sorts.


Recently, many authors attempts do deal wit the problem of faction offering
a cure that Madison in 1787 considered worse than the disease. The
suggested remedy is a type of leadership that transforms self-interest and
unites social systems around common purposes (often called
transformational leadership).

The purpose of the chapter is to compare Madisons views and emerging
theories of leadership, especially as these bear on the problem of controlling
self-interested organizational behavior.

Introduction
Involves the exchange of incentives by
leaders for support from followers
The objective of such leadership is
agreement on a course of action that
satisfies the immediate, separate
purposes of both leaders and followers
Transactional Transformational
Burns (1978), Bass (1995)
The leader looks for potential motives in
followers, seeks to satisfy higher needs,
and engages the full person of the
follower.
The objective is to turn individuals
attention toward larger causes,
converting self-interest into collective
concerns.
Transforming leadership is motivating
and uplifting
Transactional leadership is immobilizing,
self-absorbing, and eventually
manipulative
Transformational versus Transactional
Leadership
Bass (1995) based on Burns framework
Conger and Kanungo (1988)
Transformational
Charisma
Individual
Consideration
Intellectual Stimulation
High degrees of effectiveness
I
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d
i
v
i
d
u
a
l

O
r
g
a
n
i
z
a
t
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Identification Formulation Design
Stages
High commitment
High task performance

The vision Thing
The negative consequences of the fact that in the organizational life,
participants get preoccupied with their own aims and interests is one of the
hardly consensus on all issues
Unproductive conflict
Depletion of the resources


In the transformational leadership literature, the administrative ideal was
summarized for Bass (1990) as:
Superior leadership performance occurs when leaders broaden and
elevate the interests of their employees, when they generate awareness
and acceptance of the purpose and mission of the group, and when
they stir their employees to look beyond their own self-interest for the
good of the group.

With no leader (transformational leadership), corporations become disabled
by bureaucracy and mediocrity;

Administrative Implications
George Washington chosen to be the president of the
Constitutional Convention

Framers recognized and appreciated individual greatness, but
refused to count on it on the development of the new
government system

They chose to protect people from the misdeeds of
scoundrels and the frailties of ordinary men and women.


The Framers vision and the Chief Executive
of the Convention
All societies are divided into different interest groups or factions;
These factions tend to pursue their own welfare at others expense, resulting in conflict;

How to manage factional conflict and minimize its potential for harm?
Opening point
Removing its causes Control its effects
Suppressing
Freedom
Persuasion
He proposes to use government to help factions check and balance one another, limiting the
capacity of the strong to take advantage of the weak
Madisons Plan
Trigger is critical:
Lower needs, such as physical survival and economic security. These needs are
addressed by transactional leaders
Higher needs, such as moral purpose and participation in a group. Theses are
considered more authentic needs, therefore must be in charge of transforming leaders
who can refocus attention with much greater effect
Transformational
Madison
Human motivation?
Not everyone is attracted to the same goals or leaders
Some employees may not react well to a leader even though most view the leader in a
positive way
Because people are different, minority ideas about the value of particular goals and
interests are likely to exist within large social groups
If differences in individual interests exist within society, and if a majority united by a
common interest cannot be restrained from harming minorities, then the only way to
prevent harm is to keep majorities form uniting around common interests the reverse of
what transformational leaders are supposed to do
Madisonian and Transformational
Leadership Models Compared
Madisons view apply to private organizations; The problems are very similar:
Controlling factions
Ambitious leadears

Threats posed by leaders Threats posed by Factions
They can do as much harm as good
Protection against abuses of power

Madisons concerns not only about the danger of self-interested leaders but the self-
interested majorities acting in the name of some common purpose


Organizational Implications
Paradigm: Organization would not exist if
it were not for some common purpose
(Hall, 1977), since they do exist
organization must have a glue
a) Easy to talk about organization
common goal in the abstract, yet
difficult in the real word
b) Interpretation of the goal diversity
not as a bad paradigm, but bad
organizations

Systems without common goals are
falling apart and need a glue, a
transformational leader
Transformational Madison
Not such purpose or glue is necessary

Madison system participants agree not
on goals, but on specific activities
(legislation) which address their different
goals

Rights versus goals in Organizational
Theory
The concept of transformational leadership implies that individual interests are less legitimate
than collective ends and a call for charismatic presidents
Myth 1 Myth 2 Myth 3
Need for create a vision Should be
transformational leader
Charisma is an important
aspect of leadership
Birnbaum(1992)
Birnbaum data indicates that the kind of imperial presidency is not effective

In general, successful leaders respect diversity, each ones own goals and individual rights.
Shared leadership all clearly madisonian priorities.

Chapter Conclusion
Birnbaum(1992)
AGREEMENTS
Importance of groups and common goals
and interests inside a society or
organization;
Deals with the pressures majority
exercises upon minority groups bad
democracy;
The Madison view about the controlling
systems for faction disadvantages
- rules;
- effect control instead of causes
monitoring.
Madison lights upon the transformational
leader some criticizes concerned to self-
interested biases;
The authors wonder about the
applicability of federalist system: why less
freedom have being prescribed for
others?
DISAGREEMENTS
Madisons opinion about mitigate the
effects represent some risk of high costs
for a company;
Organizations must work guided by any
sort of direction empathic to any group or
ones value or interest people dont
respond only to corporate objectives and
financial stimulus;
Ethical norms institutionalised in a
corporation has not been enough to
guarantee ethical behaviour;
The chapter does not give more profound
view about how much freedom should
go inside an institutes like organizations;
How should the group or individuals free
opinion and interests should be manage
despite current norms approach?
Multinational corporation and family
business.
Analysis and Critics
Chapter 9 Ethics, Character and
Authentic Transformational Leadership
Behavior
Gaspar Giacomini, Guilherme Caetano
Leaders as a many headed hydra
The stories that recount their accomplishments raise moral
questions concerning their character and legitimacy.
x x
The 3 pillars
Moral character
of the leader
Ethical
legitimacy
Morality of the
ethical choice
and actions
Ethics of Leadership
Transactional and Transformational
Leadership
Contingent
Reinforcement
Contingent
Rewarding
Motivated by promises, praises,
reward; Corrected by reproof,
threats, sanctions.

Leaders consult with followers
what is to be done in exchange of
rewards.
Active Management by
Exception
Passive Management by
exception
Leaders monitor followers
mistakes.

Leaders wait to followers
mistakes.
Charisma / idealized
influence
Inspirational
motivation
Intellectual
stimulation
Individualized
consideration
Transactional and Transformational
Leadership
Followers identify
with the leaders
aspirations and want
to emulate theim.
It is a continuum
Transformational
Transactional
Most leaders are likely to display a mixed moral profile
Individualist x Group Societies
Individualist philosophies Group philosophies
Pursue sel-interest
Leaders should be
transactional
Free contract as a
legitimate model

concept of self connected to
friends, family, coworkers,
community.
more consistent with Judaic-
Christian traditions.
Motivation should grow from
authentic inner commitment

Authentic x Pseudo-Transformational
Leadership
X
Idealized Influence (Charisma)
Authentic Transformational Leaders
Envisioning and confident
Sets high standards for emulation
Values: universal brotherhood
Underlying values are morally uplifting
Pseudo-Transformational Leaders
seek power and position at the expense
of their followers achievements
lack sense of true responsability
Behavior is inconsistent and unreliable

We need them
to promote
ethical policies
Inspirational Motivation
Provides followers
with challanges and
meaning for
engaging in shared
goals.
Authentic Transformational Leaders
focus on the best in people
Inwardly and outwardly concerned
about the good that can be achieved
for the group, organization or society


Pseudo-Transformational Leaders
focus on the worst in people
May mislead, deceive, prevaricate
May provide false empowerment
False Prophets

Intellectual Stimulation
Authentic Transformational Leaders
Persuade others on the merit of the issues
Helps followers to question assumptions
and generate creative solutions to problemas
Pseudo-Transformational Leaders
Based on false assumptions to slay uncertainty
Overweight authority and underweight reason
Take credit for others ideas but make them
scapegoats for failure

Individualized Consideration
Authentic Transformational Leaders
Altruism
each follower is treated as and individual
Provides coaching, mentoring and growth opportunities
Channel their need for power to serve others
Pseudo-Transformational Leaders
concerned about maintaining followers dependence
welcome blind obedience

Character and Transformational Leadership
In Leadership, character matters.

Sages and Prophets have historically
been perceived as agents of change, as
well as people to be emulated and as
leaders os others.

To be sure, moral leadership is not be
confused with occupying official
positions of authority.
Pretense and Impression Management
The authentic leader
remain ethical while
using it.
The modern ethical agenda
Is it possible to have idealized
influence and inspirational
motivation without controlling,
dominating, diminishing free
choice and self-determinations
of followers?
Analysis and Critics
Right, transformational but not just transformational, must be
authentic
But, what is the purpose of a organization?
Doesnt it depends on its level of maturity?

The levels of management (leadership) we are talking about?
What about the shareholder? Shouldnt there be a different
weight for the roles?

It is hard to draw the limits when we deal with people e.g.
Behavior is inconsistent and unreliable - on whos point of
view?
Values: universal brotherhood? Does it exists?
Analysis and Critics
The leader theoretically should know what is the best for the
people.

I think the argument utilized by Madison is very strong: People
are different, and therefore, try to make them to think as
Bottom line, leaders are likely to display a mixed moral profile