Leadership,

Trustworthiness &

Ethical Stewardship

Comparative Analysis

Advanced Leadership & Ethics

Professor Armstead

November 2014

Caldwell, Hayes and Long (2010) cite several

findings on the characteristics of successful leaders.

What Leaders Demonstrate &

How They Do What They Do

• Integrity

• Wisdom & judgment

• Maturity

• Seek to understand &

respect others

• Confidence, yet humility

For you to perform your best work, what are the

top 3 characteristics of your ideal leader and why?

• Hire well & trust employees

• Emotional intelligence

• Keen self-awareness

and authenticity

• Cultural competence

• Inspiring and mentoring

What w i d e n s the

Gap of Trust between

Leaders & Followers?L

What bridges the

Gap of Trust between

Leaders & Followers?

A leader’s trustworthiness impacts the level of

in organizational leadership.

Trust serves as a cornerstone for effective leaders.

Leaders earn the stamp of “Trustworthiness” when they can

effectively use resources and build successful relationships.

Tone at the Top contributes to organizational leadership

earning the trust of employees.

Department leaders can earn trust, even if there’s a gap of

trust at the organizational level.

Have you experienced a time when you trusted an

individual leader, but did not fully trust the organization?

If so, how did it impact your performance?

Another Theory of Governance:

ETHICAL STEWARDSHIP

• Stewardship theory: leaders are responsible to the organization to create long-term wealth, for the benefit of all stakeholders and society overall

• Ethical stewardship: great leaders go beyond wealth creation; they enhance the stakeholders’ sense of ownership and commitment

• Caldwell et al., (2010) summarize other researchers’ findings on the ethical stewards, who:

Interact with followers as “owners and partners (Block, 1993).

Integrate economic and social performance to meet moral and ethical objectives (Hosmer, 2007; Paine, 2002).

Operate the business with a long-term focus, to avoid short-term decisions that seemingly increase market value but compromise the company’s ability toachieve its primary mission (Paine, 2002; Pfeffer, 1998).

Recognize that they have a responsibility to existing stakeholders,as well as future ones (Hernandez, 2008).

• Murphy (2009) noted that leaders who privately practice their own religious beliefs have a higher likelihood to make ethical decisions, compared to their non-religious counterparts.

How Important is …

E

T

H

I

C

A

L

Stewardship?

Who Determines?

• From the examples discussed, do you think the leaders exhibited unethical business practices?

The Body Shop: Leadership Modeling Trustworthiness & Ethical Stewardship

“The business of business should not just be about money, it should be about

responsibility. It should be about public good, not private greed.”

The Body Shop Founder, Dame Anita Roddick

Bendigo Bank:

Modeling Social Responsibility and Ethical Stewardship

What’s the Correlation?

Leadership

Trust-worthinessEthical

Stewardship

Leadership, Trustworthiness & Ethical Stewardship

SUMMARY and WHAT’S NEXT

Great leaders stand firm in their own values and strive to

ensure that their actions reflect ethical behavior—as they define

ethical. The highest level of leaders practice a leadership style that demonstrates their

personal values and perspective on ethical stewardship.

ReferencesBeebe, G. D. (2012). Character formation. Leadership Excellence, 29(6), 20. Retrieved from

www.leaderexcel.com

Bendigo Bank Website (2014). Retrieved from http://www.bendigobank.com.au/public/

Caldwell, C., Hayes, L. A., & Long, D. T. (2010). Leadership, trustworthiness, and ethical stewardship. Journal

of Business Ethics, 96(4), 497-512. doi:10.1007/s10551-010-0489-y

Drucker, P. (1981). What is “Business Ethics”? The Public Interest, 63, 18-36. Retrieved from

http://www.nationalaffairs.com/public_interest/detail/what-is-business-ethics

Eagly, A. H., & Chin, J. L. (2010). Diversity and leadership in a changing world. American Psychologist, 65(3),

216-224. doi:10.1037/a0018957

Friedman, M. (1970, September 13). The social responsibility of business to increase its profits. The New York

Times. Retrieved from http://www.colorado.edu/studentgroups/libertarians/issues/friedman-soc-resp-

business.html

Goleman, D. (2013, December). The focused leader: How effective executives direct their own—and their

organizations’—attention. Harvard Business Review, 50-60. Retrieved from https://hbr.org/2013/12/the-

focused-leader

Murphy, P. E. (2009). The relevance of responsibility to ethical business decisions. Journal of Business Ethics,

90(2), 245-252. doi:10.1007/s10551-010-0378-4

The Body Shop International PLC Website (2014). Retrieved from http://www.thebodyshop-

usa.com/index.aspx