The Relationship Between Leadership Ethics and Organizational Success

Abstract

Over the last few decades, business fraud and examples of scandalous management behaviors have sparked a lot of attention among several interested stakeholders. These increasing scandals have necessitated the question on the necessary steps required to prevent their frequent occurrence. The lack of commitment to strong ethical standards by management has been underpinned as the cause of ethical misconducts in organizations. The fiscal crisis of 2007-2009 witnessed many leadership misconducts and abuse of leadership responsibility. The fiscal crisis revealed the loss of about $11 trillion in household wealth, 26 million Americans losing their jobs, and 4.5 million Americans who could not afford their mortgages. These events and statistics show the prevalent lack of ethical leadership in organizations. While leadership ethics is a concern for all stakeholders within business organizations in the United States, only a few segments of the industry are taking steps to incorporate ethical awareness within their global organizations.