Efficacy of Leadership Ethics As A Tool For Developing Capabilities: A Study On Mba Studentsperspectives

http://ijopaar.org/ijopams.php/; 2017 Vol. 4(1); pp.
19-30, ISSN: 456-4516
EFFICACY OF LEADERSHIP ETHICS AS A TOOL FOR

DEVELOPING CAPABILITIES: A STUDY ON MBA
STUDENTSPERSPECTIVES
*Anand Shankar Raja M
**Shubham Goel&Preethi Sarah J P
*Anand Shankar Raja M, Assistant Professor, Department of commerce, Christ University, Bengaluru
**Shubham Goel and Preethi Sarah JP, Post Graduate scholar (Mcom), Department of commerce,
Christ University, Bengaluru – 560029.
Abstract
The main theme of this study is to understand the student perception towards leadership ethics
concept. Business management students chose to do their Higher education in the field of business
administration to improve their ethical leadership qualities. This reasonable choice is due to their
capabilities, expectations and major source of influence form the internal and external
environment. The students who are doing their higher education in the field of business
management are the target respondents for this research work. The data has been collected from
238 students across the city of Bangalore focusing on the deemed universities which offers the
Master of Business Administration program. The researchers have used convenient sampling
method to collect the data. Factor analysis has been used for dimension reduction. From the
results of the factor analysis those factors which had less Eigen values were removed and the
remaining was maintained for the final analysis. The research work concludes that with regard to
the internal factors contributing towards ethical leadership qualities students should give
importance to Active participation and being an extrovert at the same time they should
commitment towards task and keen dedication toward the work which they do. This dedication
would enhance various types of skills for sustainability and motivate them to be creative in
thinking and to be more research oriented. In a nutshell the study concludes that if the students
have to be a successful leader should be equally influenced by the internal and external sources.
Key Words: Efficacy of leadership ethics, Student capabilities, perspectives.
1. INTRODUCTION
With the world being dynamic in nature and new challenges emerging on a regular basis, the
moral and ethical values of various individuals are being threatened. Individuals have to make
challenging decisions which can have a huge impact on their future. Such decisions can impact the
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organization in a positive or a negative way. To ensure that the organization is impacted in a positive
way, a leader must be ethical. A leader is one, who carries the right antecedent and sets the right
benchmark for his followers. Leaders such as Abraham Lincoln, Mahatma Gandhi, Nelson Mandela,
to name a few, had their own set of morals and values, which inspired many people. They had the
ability to inculcate a new vision and provided the right quality in decision-making to accomplish their
goals. James Burke, a former CEO of Johnson & Johnson is another such example. James Burke
believed in being honest and dealing with problems with openness and candor which allowed the
company to recover from the Tylenol poisoning which occurred in 1982. James Burke once said in an
interview that "Every relationship that works is based on trust, and you don't develop trust without
moral behavior” (Patrick E. Murphy and George Enderle, 1995) [1a].Ethical leadership rose to
prominence after the world was taken aback by various scams and frauds such as Enron, WorldCom,
Harshad Mehta’s case, Sathyam scam, Commonwealth games, 2G spectrum scam and other such
cases. These scams led the world to take notice of ethics in leadership. The world wanted leaders who
were ethical to guide them to achieve their goals. Leadership Ethics is a “demonstration of
normatively appropriate conduct through personal actions and interpersonal relationships, and the
promotion of such conduct to followers through two-way communication, reinforcement, and
decision-making” (Brown et al., 2005). Leadership has gone a long way from having profit oriented
goals to the belief “Do to others as you would have them do to you”. Leadership ethics is important
for success over a long period of time. Leadership Ethics has a positive and significant relationship to
promotion to a senior leadership position but not for a short-term leadership position. (Robert S.
Rubin et al., 2010) [3a]. This shows that promotion to a senior position requires a leader to be ethical
in the long-run. Ethical Leadership helps to improve the reputation of an organization and helps to
attract and retain employees.
A study showed that individuals believed that the most influential ethical traits were
character, respect and appreciation for others and collective orientation. The most influential unethical
traits were being motivated by self-interest and Misusing power, Incivility and Deception and
Dishonesty (Christian J. Resick et al., 2011). An ethical leader must embrace and promote the ethical
culture within the organization. In India, Russi Mody was successful as a leader at Tata Steel but did
not succeed at Indian Airlines as the cultures of the two organizations were so different (Rooplekha
Khuntia and Damodar Suar, 2004) [5a]. Such leaders also embrace diversity and ensure that ethics are
followed even when there is high pressure to achieve results. A study stated that, leaders must be
educated to be ethical, reappraise the false nature of valuing material goods over humans and the
environment, and create a world which provides justice to all and is sustainable in nature (Deborah C.

Poff, 2010) [6a]. This study looks at ethical leadership from the perspective of a student to find the
factors students feel contributes to ethical leadership.
2. REVIEW OF LITERATURE
George Enderle (George Enderle, 1987), explained that leadership strikes the right chord to create a
vision to the leaders as well as subordinates and the responsibility in implementation of corporate
goals, at the end of the day, the leaders are bound to work in the circumference laid down by the
corporate policies, and desire to meet the corporate goals is of vital importance. Thirdly, perceiving,
interpreting and creating reality is an important prerequisite for decision making. Patrick E. Murphy
and Georges Enderle, 1995 [1b], conducted a study on Managerial Ethical Leadership with the help of
examples. The researchers found five themes which were common among the leaders. The first was
that these leaders believed in doing their work with openness and honesty. The second, all these
leaders stated strongly their beliefs with the ideals of the organization. Thirdly, the leaders cared about
how they would impact others through their decisions. The fourth was that these leaders were highly
motivated and were emotionally strong. Finally, all these leaders had very strong religious beliefs to
guide them through ethical practices.
Rooplekha Khuntia and Damodar Suar, 2004 [5b], believed that organizational structure is
dynamic and changes according to the style of organizational structure. Robert S. Rubin et al., 2010
[3b], explored the relationship between Leadership Ethics and Promotability. An empirical approach
was used to examine this relationship. There was a positive and a significantlink between leadership
ethics and promotability to a senior leadership position. The same was not found for short term
promotability. Deborah C. Poff, 2010 [6b], stated that Ethical Leadership Compass designed by the
researcher was significant and bestows legitimacy and directs the aspiring leaders to take up the right
direction with the right moral value such as honesty, trustworthy, integrity, loyalty and dedication to
virtue. David M. Mayer et al., 2010 [8], the researchers looks at the possibility of ethical atmosphere
acting as a moderator between the misconduct of employees and leadership ethics. The researchers
also found that ethical atmosphere was negatively related to the misconduct of employees.
Christian J. Resick, Gillian S. Martin et al., 2011, examined Ethical Leadership from an
American, Asian and European point of view. The researchers found that influential ethical traits were
character, collective orientation and respect and appreciation for others. The influential unethical traits
were Incivility, being motivated by self-interests, Misusing power, Deception and Dishonesty. The
study also mentions that what may be ethical in one culture may not be ethical in another culture.
Catherine Marsh, 2012, studied the aspects that ethical leaders felt was important for ethical
leadership. The researcher made two models for this study. The first is a framework for ethical

leadership which looks at value aspects and value perspectives used for decision making. Samuel T.
Hunter, 2012, described that Authenticity isa key attribute for an ethical leader. A leader, who
possesses authenticity, has greater ethical quality and potential for growth. The ethical leaders drive
two outcomes, the employee well-being and job satisfaction in the workplace.
3. STUDY OBJECTIVE
To identify the internal and external factors that impacts the perception of MBA students on ethical
leadership and to determine if these factors will help the student community to successful leaders
from their perspective.
INFERENCE FOR THE MODEL FRAMEWORK
From the above figure 1 it is clearly understood that, ethical leadership can be influenced by
various internal and external. These factors are important in shaping ethical leaders of the future.
Students can be influenced by such factors easily and it is very important to understand the impact of
this on potential leaders. The religion followed by a student can play an important part on determining
how ethical the student would be. Religious values help shape the personal and moral values of an
individual from a very young age. Each religion promotes being good and ethical in its own way. This
is very important as it acts as a base for students to be ethical as leaders. The religious beliefs act as a
guideline for students to follow and help them remain ethical over time. Another factor which has a
big influence in ethical leadership is competition. There is a high level of competition in the world
and it can have a big impact on potential leaders. Those individuals that find solutions without using
unethical means are likely to becoming ethical leaders in the future. Students face a lot of competition
and it is very important that this is looked at positively. A student that faces competition with a
positive attitude and creativity has a very good opportunity to be successful. Competition also helps to
improve the decision making process of a student and helps them look at things differently. This is
required to keep up with the dynamic nature of the world. Another reason that paved the way for
ethical leadership was the number of scams that have taken place among various companies in the
past. These scams portray the leaders involved in a negative way. The society is aware about the
negative impact unethical leaders can have. This has led to growing importance in leaders who are
ethical in nature. Students are being taught from a young age about ethics. This is to make them aware
that leadership must be taken up in the right way to help develop the society. Scams have ensured that
leaders for the future generations must be ethical and this is a very important criterion for
promotability to senior positions in an organization. The skills inculcated by students are very
important to ensure they become leaders. These skills involved executory skills, communication,
creative thinking and other such skills. They are very important to students for placements into

MODEL FRAMEWORK
Internal Factors
1. Accountability
2. Active Participation
3. Motivation
4. Authority and Active
Domination
5. Creative Thinking
6. Consideration
7. Executory Skills
8. Blood relatives and
family
9. Personal values and
morals
10. Life experiences
11. Commitment
12. Education
13. Honesty and Openness
14. Effective Communication
Student
15. Flexibility Perspectives
External Factors
1. Career Development
2. Promotability
3. Placements
4. Competition
5. Building up contact
Figure 1-Model framework on internal
6. Organization Culture
7. Peer Influence and external factors that impact MBA
8. Social Pressure
student’s perspectives on ethical
9. Observation and Imitation
10. Working with teams leadership. This Model was framed by
11. Technology Preethi Sarah and Shubham Goel/ Anand
12. Managing Change
13. Effective utilization of resources Shankar Raja M.
14. Strategy Formulation
15. Achievement of high-octane
results
Organizations. The student’s attitude and skills are looked at by organizations and their personal and
moral values are also tested. This allows organizations to grow over time and gain reputation due to
the quality of employees retained and hired by them. An individual needs appropriate skills to be a
successful leader. A leader with the appropriate skills that is ethical in nature will be very important to
organizations. Thus, various factors play a role in the development of a student into an ethical leader.
4. RESEARCH MATERIALS & METHODS
This research work determines the perspective of Ethical Leadership among the MBA
students. The study for this research is in the month of July 2017. The study undertakes first-hand
information from the students using a questionnaire schedule and hence it deals with primary data. At
the same time, the existing data from reputed database and other secondary sources has been made the
best use. Thus, the study relies on primary and secondary data. Stratified sampling is taken into
consideration, as the sample size focuses on Master of Business Administration students, possessing
right knowledge on Ethical Leadership. Thus, 238 samples were drawn from Master of Business
Administration classes. Students from Bangalore are considered as the population of this research
study. Bangalore is selected because the city boasts about its prestigious colleges that specialize in
commerce and management. In this research work multi-scales are checked for reliability analysis
with the help of SPSS version 20. The test results ranges from .69 to .769 for different segments of
research instrument indicating that it is reliable. A commonly accepted rule for describing internal
consistency using Cronbach’s alpha has been satisfied.
5. DATA ANALYSIS & INTERPRETATION
TABLE 1.0
KMO and Bartlett's Test (internal factors)

Kaiser-Meyer-Olkin Measure of Sampling Adequacy. .653
Approx. Chi-Square 1663.345
Bartlett's Test of Sphericity Df 105
Sig. .000
TABLE 1.1
Rotated Component Matrixa(internal factors)
Component
1 2 3 4 5
I perceive active participation
is required for ethical .839
leadership
My personal values and morals
impact my ethical leadership .749
ability
Authority and active
domination helps my ethical .661
leadership skills
Having the commitment to
pursue excellence leads to .567
ethical leadership
Flexibility helps in ethical
.781
leadership
Effective communication helps
.758
in better ethical leadership skill
My actions as a leader must
show honesty and openness for .733
ethical leadership
Education that i have had helps
influence me to follow ethical .589
leadership skills
Life experiences can impact
the ethical leadership skills of a .480
person
The habits of my blood
relations and family influence
.763
my motivation to follow ethical
leadership
Having consideration for
others guides my ethical .650
leadership qualities
As a student i take
accountability to have ethical .590
leadership skills
As a student i feel that my
creative thinking abilities help .792
me shine as a business leader
Executory skills are important
.602
for ethical leadership
Being self-motivated is
necessary for being a .891
successful ethical leader
Extraction Method: Principal Component Analysis.
Rotation Method: Varimax with Kaiser Normalization.
a. Rotation converged in 11 iterations.
5. Factor Analysis Interpretation for internal factors

After screening through the sample size and adequacy of 238, was done in this research using
Kaiser-Meyer-Olkin (KMO) & the Bartlett’s test which specified the reasonable basis for a factor
analysis to check the interlink between the variable, and the results clearly portrayed that the sample
adequacy norms were met and the variables used in the analysis were highly correlated with each

other. Almost all the scale items had a good communality range as shown under extraction except a
few which were removed from being clubbed for the allocation of appropriate name.
TABLE 1.3
Component 1 Active participation and being an extrovert
Component 2 Commitment towards task and keen dedication
Component 3 Enhancing various types of skills for sustainability
Component 4 Creative thinking and research oriented
Component 5 Self-motivated and confident
TABLE 1.4
KMO and Bartlett's Test (external factors)

Kaiser-Meyer-Olkin Measure of Sampling Adequacy. .632
Approx. Chi-Square 2104.296
Bartlett's Test of Sphericity Df 105
Sig. .000
TABLE 1.5
Component Matrixa(external factors)
Component
1 2 3 4
The career development of famous
leaders encourages me to be an .615
ethical leader
As ethical leadership helps for
promotability to higher positions, I .563
would follow it
Placements require students which
are ethical and this encourages me .739
to be more ethical in my actions
Competition around me motivates
.778
me to follow ethical leadership skills
Building up contacts with various
people can help my future as an .575
ethical leader
The co-culture with other students
.454
motivates me to be an ethical leader
I believe that Peer Influence can
.637
impact my leadership qualities

The social pressure to be moral at all
times influences my decisions as a .657
leader
Various role models and their work
encourage me to have ethical leader .507
skills
The teams I work with can influence
my leadership skills and ethical .757
beliefs
As technology is dynamic and ever
changing it can play a role on
.680
deciding how ethical I would be as a
leader
The world is ever changing and
managing such change in the right .583
way helps my leadership ability
Effective utilization of resources
makes it easier for a leader to be .666
ethical in nature
The popular business strategy
formulations motivate me to have .566
ethical leadership skills
The need for achievement of high-
octane results can impact my
.752
decision making and my ethical
values as a leader
Extraction Method: Principal Component Analysis.
a. 4 components extracted.
Factor Analysis Interpretation for external factors

After screening through the sample size and adequacy of 238, was done in this research using
Kaiser-Meyer-Olkin (KMO) & the Bartlett’s test which specified the reasonable basis for a factor
analysis to check the interlink between the variable, and the results clearly portrayed that the sample
adequacy norms were met and the variables used in the analysis were highly correlated with each
other. Almost all the scale items had a good communality range as shown under extraction except a
few which were removed from being clubbed for the allocation of appropriate name.
TABLE 1.6
Component 1 Career opportunities
Component 2 Influence from external sources
Component 3 Technological adoption
Component 4 New insights from the world ethical environment

6. DISCUSSION
According to Meyer, Motivation is one's direction to behavior, or what cause a person to repeat a
behavior and vice versa. It affects a person's decision direction, intensity and persistence of behavior.
Methods of motivating employees are monetary and non-monetary benefits Ethical Leadership. The
personal trait such as integrity, honesty and truth worthiness depicts ethical. Thus motivation and
confidence among the student community plays an important role in achieving the leadership skills.
Trait leadership theory is based on the assumptions that some traits are particularly suited to
leadership and that good leaders have the right combination of traits. Some of the traits that were
found to be higher in leaders compared to non-leaders in some early work (reviewed by Stogdill,
1974; House and Baetz, 1979) are such as intelligence, dominance/need for power, self-confidence,
energy/ persistence and knowledge of the task. Extraversion is also one of the personality
characteristics that have been found in some studies to be more characteristic of leaders compared to
non-leaders (Arnold, 2005, p. 484). Thus by taking into consideration the various researchers works
on ethical leadership it can be concluded that, students who have chosen MBA or any other
professional courses with an aim to be a successful leader should make sure that they are hard workers
and risk takers because leaders are not born they are created. One has to be self-motivated to be a
successful leader. Thus the four components are very apt for the study. Mary Beth Foglia (2013),
states that the important relationships between ethical leadership, an organization's environment and
culture, and overall ethics quality. Certain leadership practices may have a larger impact on
employees’ perceptions of overall ethics quality than others.
7. CONCLUSION
Ethical Leadership is becoming a requirement for reputed organizations, especially for the senior
management positions. These leaders must have strong principles and must ensure that there is
consistency in their decision making process. Ethical leaders must re-affirm their ideals with the
direction of their organizations. Ethical leadership is dynamic concept which is being as an important
trait for the new generation of leaders. The world wants to avoid new scams and ethical leadership is
one of the most efficient ways to do so. It has been proved that ethical leadership can help improve an
organization in the long run and it has been preached by various leaders who had very successful
careers. For a student to become an ethical leader, it is helpful if the student is an active participant
and an extrovert that is dedicated and committed towards various tasks. It is also important for
students to ensure that they have the necessary skills required and to work on their skills from time to
time to ensure that they can complete the required tasks. Having creative thinking and being research

oriented helps students look at situations in a unique way which can help them find the best possible
solutions for any problems they come across. A student must also be self-motivated and confident so
that it is possible to put together the beliefs of the student and change such beliefs into reality. Career
opportunities can guide the actions of a student towards ethical leadership. Students are also
influenced by external sources such as peer pressure, social pressure, the co-culture with other
students and also the contacts they build up as a student. All these sources can influence the ethical
decisions a student takes over time. The way students adopt to technology which is dynamic in nature
can also influence their ethical skills as a leader. Students also gain various insights over time which
helps form the world ethical environment. All these factors make it possible for a student to become
an ethical leader in the future. Ethical leadership ensures that the future is bright and filled with
various opportunities for people.
8. RECOMMENDATION
Students are the next generation of leaders in a country. Students need ethical leadership qualities to
ensure that their future is bright. Various scams and frauds in recent years have made the general
public look at the leaders in a negative way. Ethical leadership is important to change this perception.
Ethical leadership allows students to be accountable to their actions and pave the way for a better
world. A number of students have been graduating each year and would step into the role of
leadership in the near future. Responsibility lies on universities, to help students focus on ethics, also
by modifying curriculums to expand the horizon of ethical leadership. Universities can help provide
students exposures of various kinds which include various seminars, conferences and field visits. This
provides students a base on which they can build their knowledge upon and helps them grow as
individuals. Universities can inculcate courses which teach students about the importance of ethics
and why the students as individuals must follow ethics to ensure a better and successful future.
References
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Business Ethics Quarterly, 5(1), 117.Doi: 10.2307/3857275
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perspective for construct development and testing. Organizational Behavior and Human
Decision Processes, 97(2), 117-134. doi:10.1016/j.obhdp.2005.03.002
3. Rubin, R. S., Dierdorff, E. C., & Brown, M. E. (2010). Do Ethical Leaders Get Ahead?
Exploring Ethical Leadership and Promotability. Business Ethics Quarterly, 20(02), 215-236.
Doi: 10.5840/beq201020216
4. Resick, C. J., Martin, G. S., Keating, M. A., Dickson, M. W., Kwan, H. K., & Peng, C.
(2011). What Ethical Leadership Means to Me: Asian, American, and European Perspectives.
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5. Khuntia, R., & Suar, D. (2004). A Scale to Assess Ethical Leadership of Indian Private and
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Accepted 06 Nov 2012, Published online: 11 Feb , 2013


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http://ijopaar.org/ijopams.php/; 2017 Vol. 4(1); pp.

19-30, ISSN: 456-4516

EFFICACY OF LEADERSHIP ETHICS AS A TOOL FOR

Key Words: Efficacy of leadership ethics, Student capabilities, perspectives.

UGC JOURNAL NO. 45255;

UGC JOURNAL NO. 45255;

UGC JOURNAL NO. 45255;

INFERENCE FOR THE MODEL FRAMEWORK

UGC JOURNAL NO. 45255;

KMO and Bartlett's Test (internal factors)

5. Factor Analysis Interpretation for internal factors

UGC JOURNAL NO. 45255;

Component 1 Active participation and being an extrovert

Component 2 Commitment towards task and keen dedication

Component 3 Enhancing various types of skills for sustainability

Component 4 Creative thinking and research oriented

Component 5 Self-motivated and confident

KMO and Bartlett's Test (external factors)

UGC JOURNAL NO. 45255;

Factor Analysis Interpretation for external factors

Component 1 Career opportunities

Component 2 Influence from external sources

Component 3 Technological adoption

Component 4 New insights from the world ethical environment

UGC JOURNAL NO. 45255;

UGC JOURNAL NO. 45255;

1. Murphy, P. E., & Enderle, G. (1995).Managerial Ethical Leadership: Examples Do Matter.

UGC JOURNAL NO. 45255;

UGC JOURNAL NO. 45255;

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