Leadership, Ethics, Power, and Cultural Influences Explained

Cultural and Societal Influences on Leadership

The content, manner of manifestation, and efficiency of leadership are the result of several determining factors. The education a leader benefits from represents one of these factors. Education's contribution to leadership development is studied on three distinct levels: general education, professional education, and managerial education.

General education builds the foundation of individual and social behavior and provides a general knowledge base with important effects at the communicational level. Professional education in technical, economic, or information technology fields ensures the personal competency and prestige of specialists, which is of great importance in relationships with others in the same domain. Managerial education primarily focuses on developing the innate abilities that leadership is based on. Such education also emphasizes developing and improving the ability to influence the decisions, actions, and behavior of other people.

The combined result of these training processes has a significant impact on social abilities, technical knowledge, decisional and communicational ability, and managerial behavior — all essential factors for effective leadership. During the last few decades, as a consequence of the numerous positive implications of leadership, managerial education has granted considerable specific attention to elements that affect leadership development. This has had practical effects: the number of managers who exercise efficient leadership based on techniques developed through managerial training has increased in developed countries.

As experts in the field note, given the current turbulent global conditions, leadership has become more important than management techniques alone (De Woot, 1992). Societal and cultural factors shape leadership in complex and distinct ways, and their influence is closely tied to the degree of civilization and development of the country in question.

It has been observed that "founders of organizations, the organizations' original leaders, are immersed in their own societal culture, and they are most likely to enact the global leader behavior patterns that are favored in that culture" (House et al., 1999). In other words, the founders or leaders of an organization establish themselves as role models, setting a general leadership style that is subsequently embraced by subordinate leaders. This style is passed on to subordinates through role modeling and socialization.

Because a founder's presence in organizational activity allows for a constant influence on subordinate leaders, there is no coercive pressure for subordinates to follow that example — they are influenced in a natural manner and accept the founder's leadership style without negative response. As a consequence, the behavior of leaders reflects broader leadership patterns that are themselves a reflection of the entire societal culture.

Culture also affects the general vision of leaders. For example, Chinese individuals expect their leaders to be more action-oriented and to limit lengthy verbal speeches, which is more common in Western civilization. The Indian culture differs significantly from the Chinese, as Indians tend to prefer leaders who take risks (Wharton Network, 1999). The importance of gender and cultural background on leadership style varies by region. The effect of these factors is moderate in Anglo, Nordic, Germanic, and Eastern European contexts, as well as in South Asia, though with different implications in each setting (Van Emmerick et al., 2009).

Types of Leadership and Their Cultural Drivers

Certain studies have revealed that each type of leadership is influenced by distinct cultural and societal factors. According to the GLOBE project (House et al., 1999), the relationships are as follows:

Charismatic or value-based leadership is influenced by future orientation and humane orientation. Team-oriented leadership is influenced by collectivism, humane orientation, assertiveness, and uncertainty avoidance. Participative leadership is influenced by power distance and humane orientation. Humane orientation leadership is influenced by gender egalitarianism. Autonomous leadership is influenced by collectivism. Self-protective leadership is influenced by power distance and uncertainty avoidance.

These societal and cultural factors manifest in distinct ways. Uncertainty avoidance, for example, assumes an increased number of information-processing mechanisms, meaning that leadership in this context treats information as a resource of high importance. The power distance factor can be identified in situations where the number of independent scientists is limited, which means that intellectual inquiry is somewhat suppressed — a situation observable in less developed countries.

Gender egalitarianism is indicated by a high proportion of females with earned income, reflecting a lower degree of discrimination against women and increased participation by women in the workforce. Such conditions are more characteristic of developed, Western societies. Humane orientation is revealed by a low number of retail outlets per capita, suggesting that attention is oriented toward relationships rather than economic commodities. Future orientation is found in countries where a high proportion of public education expenditure is devoted to higher education, "indicating public investment for future opportunities and future economic performance" (House et al., 1999). Performance orientation corresponds to countries where only a small percentage of research and development is government-funded, suggesting free market competition and limited government intervention in the economy.

Western, developed countries with economies of international importance tend to be characterized by leadership influenced by uncertainty avoidance, gender egalitarianism, future orientation, and performance orientation. Developing countries, by contrast, tend toward leadership influenced by power distance, collectivism, and humane orientation. This means that leaders cannot simply choose a type of leadership based on personal preference; these influencing factors are largely inherited from their superiors, trainers, and the broader society.

Ethical Responsibilities of a Leader

In order to practice efficient leadership, leaders must first demonstrate outstanding ethics. Leaders serve as models to be followed by others, which is why ethics is so important in the context of leadership. Leaders must address the following types of ethics: morality, principle ethics, virtue ethics, mandatory ethics, and aspirational ethics.

While specialists find it difficult to agree on a single common definition of ethics, there is broad agreement that ethics show us what is right, what is wrong, and what the difference between these two is. Ethics also establish principles that all individuals should implement in order to maintain what is agreed to be right conduct.

The types of ethics mentioned above differ in their manner of manifestation, causes, and effects. Morality usually refers to an appreciation or evaluation of a person's actions, functioning on the basis of cultural and religious standards and norms. Although this type of ethics is more individual in nature, it is no less important for leaders and their subordinates.

Principle ethics have wider implications and a more complex area of manifestation. The factors of influence for this type include rational, objective, universal, and impartial principles, which are used to analyze ethical dilemmas. These principles collectively form a prerequisite for implementing an ethical system that can be followed by others.

Virtue ethics refer to an individual's character. Although this is an internal, individual characteristic, its effects are external and may become far-reaching depending on the situation. As noted earlier, a leader's effectiveness and leadership style can be attributed in part to general education, which includes character formation. The internal structure of the leader therefore has external effects and directly influences subordinates in a significant way. Certain shortcomings in this area can be corrected; others cannot, and these may affect the leadership style in one way or another.

Leaders are not perfect, and this reality should not serve as an excuse for unethical behavior. A leader who admits mistakes and tries to correct them is likely to earn more respect and appreciation from peers than one who denies or conceals such issues. Virtue ethics must also ensure that the leader acts in the best interest of those he or she represents, works with, and works for. In addition, the leader should be surrounded by individuals with similar ethical conduct, which both facilitates the achievement of ethical responsibilities and makes it easier to identify any unethical conduct by the leader.

The lowest level of ethics — though not the least important — is mandatory ethics, which refers to compliance with the law. All individuals, and especially leaders, must respect the law. Aspirational ethics refer to the effects and influence that a leader's actions have on others. The first people leaders influence are those they work with, who in turn influence the broader segment that the organization addresses, giving leaders the potential for significant and far-reaching impact.

In a survey conducted among 462 executives, 56% considered ethical behavior to be the most important characteristic required for successful leadership — more important than sound judgment and adaptability (Signature, 2001). As most theoreticians and practitioners have agreed, "it is the leader's responsibility to set the ethical tone in his organization" (Markkula Center, 2008). The ethical dimensions of leadership ethics in business contexts are therefore far more consequential than they may initially appear.

Sources of Leader Power

One of the central elements that conditions the content and results of motivation is the power that leaders hold over their subordinates within the organization. Although it is not always visible, power is a major ingredient in motivating employees.

There are several definitions of power. Finkelstein, as well as Hickson, Lee, and Schneck, define power as the ability of a person to exert and impose their will (Hickson et al., 1992). Snell and Dean define power as the ability of a person to determine the accomplishment of certain objectives in the manner they choose (Snell & Dean, 1992). More generally, in the context of organizational management, power refers to the ability of an employee, owner, or any other stakeholder to influence the decision-making process, the actions, and the behavior of other members of the organization in accordance with their will. The greater one's power, the greater one's influence.

In order to understand power within the organization, it is essential to understand its sources. Leaders' sources of power can be individual or organizational.

Individual sources of power include: the power to reward, the power to punish, formal position, personal charisma, authority of knowledge, the drive for power, the ability to harmonize processes, and trust in oneself and in one's ideas.

The power to reward is based on the leader's right to control the process of granting bonuses within the organization. The power to punish is based on the leader's competency to initiate and apply disciplinary measures when employees fail to follow established rules or meet expectations. Formal position derives from the perception among organizational members that the leader has been duly invested with authority to exert influence. Personal charisma derives from individual abilities and the natural influence the leader is able to exert on others. The authority of expertise in a given field is reflected in the leader's influence over subordinates. The personal drive for power — sometimes called the need for power — consists in an intense preoccupation with obtaining managerial influence, sustained by significant effort and energy. The ability to harmonize decisions and actions of others is based on the capacity to provide compelling arguments and to persuade. Finally, trust in oneself and in one's promoted ideas is perceived by others as a major factor in determining their participation and conformance.

Organizational sources of power include: control over resources, formal authority or competency, the ability to solve problems involving risks and uncertainties, and the position held within work processes.

Control over resources is probably the most important factor of organizational power. The more directly a person controls resources such as money, personnel, equipment, energy, and information, the greater the influence. Leaders' formal authority consists in their decisional rights within the organization; this authority can only be exceeded by that of owners or major shareholders who control the financial resources that fuel the organization. The ability to solve problems involving risk and uncertainty earns acknowledgment and significant influence because each organization regularly confronts high-impact risk situations. The position held by the leader within work processes also shapes the degree of power: if a leader controls a high proportion of information that affects the company's activity, their influence over people and processes increases accordingly.

Leaders' power can also be divided into internal and external sources. Internal sources address the individual's own characteristics — innate abilities such as intelligence, and acquired skills developed through learning. While internal sources of power grant a certain type of authority, they alone do not suffice for practicing efficient long-term leadership. External sources — including the ability to own or gather resources, especially financial resources — are also necessary. The people who work alongside a leader similarly constitute an external source of power, as their association increases broader trust in the leader and thus extends their influence.