ETHICAL LEADERSHIP: IMPLICATIONS FOR ORGANIZATIONAL REPUTATION

Abstract

n today’s business environment, characterized by a faster communication system, managers of organizations cannot afford to engage in unethical practices because of its detrimental effect on an organization’s reputation but also the negative publicity that it will create and the consequent effect on the value. A critical issue in many organizations is practicing ethical leadership from the top management is not on its effect on the firm’s value but also on its employees because unethical leadership might have a negative effect on employee job satisfaction and performance. Ethical values must be cultivated from the top. Leaders are required to set the ethical culture by setting moral example for their followers’ for instance formal ethical codes and ethical training. Ethical leaders bear the purpose, vision, and values of an organization and the constituents, within the parameters of ethical ideals. Ethical leaders help in giving meaning to their employees’ work and also ensure that decisions are based on moral values (Avolio et al, 2011). Ethical leaders are always making efforts to incorporate moral principles in their beliefs, values and behaviour; they are committed to higher purpose, prudence, pride, patience, and persistence. This study examined ethical leadership, its dimensions and its implications for organizational reputation.