A Characteristics of a Perfect Leader from My Viewpoint

Introduction

I believe that the leader has a job of the utmost importance when considering ethical decision-making. They are at the top of the pyramid, setting the tone for the entire organization. Everyone from employees to suppliers to consumers observes how their actions play out. If they cannot lead by example and set the expectations, then we cannot expect everyone below them to be motivated to perform the actions necessary to cultivate a business that is perceived as ethical. The leader's ethical standpoint influences the company's overall reputation and can significantly impact its long-term success (Gini, 1997).

The Role of Leaders in Ethical Decision-Making

The leader has a duty to all stakeholders. Everyone who can be impacted by the decisions of the company should be taken into consideration, not just solely the stockholders. A leader should strive to maximize the returns on stockholder investments, but they should do this in a way that does not, in turn, harm any of the other stakeholders the company has. A leader’s job is to ensure that the business can meet the needs set forth by the stakeholders of that business. They should strive to resolve conflicting needs and balance the interests of all parties involved (Freeman, 1984).

Traits of an Ideal Leader

A leader should possess traits such as openness (transparency), concern for how the company's actions will affect stakeholders, active participation in actions rather than merely talking about taking action, and fairness. I believe that openness is the most crucial attribute a business and leader can offer all its stakeholders. A business built on openness and transparency has the potential to build a relationship of trust with them. This trust enhances the business's image in both the short-term and long-term. They do not attempt to obscure reality from stakeholders; instead, they present stakeholders with the truth of what occurs. I believe this transparency makes stakeholders more willing to collaborate with businesses if a problem arises.

When a leader is genuinely concerned with how the business’s actions affect stakeholders and takes steps that will not harm them, it fosters greater trust in the business. This approach is vital because it opens leaders to considering the opinions of others, such as employees and the community, who may be affected by decisions. It can lead to more informed and balanced decision-making. I believe this can help create commitment among consumers because they do not feel like a means to an end, but rather as valued partners in the business's success (Carroll, 1991).

Balancing Profit and Ethics

Neither the business nor the leader should focus solely on internalizing all the benefits while externalizing the costs onto others. Once a business becomes solely profit-driven and disregards ethics, it risks damaging its relationships. In the long-term, this could lead to ostracization by local communities and consumers and potentially trigger calls for punitive actions against the business or leader. Businesses that prioritize ethical considerations alongside profitability are more likely to sustain their operations and enjoy continued success in a competitive environment (Donaldson & Dunfee, 1999).

Conclusion

In conclusion, ethical leadership is crucial for the sustainable success of any business. By prioritizing transparency, stakeholder engagement, and a balanced approach to profit and ethics, leaders can cultivate trust and foster long-term relationships that benefit the entire organization. Leaders must remember that their actions set the standard for everyone else and have a profound impact on the business's ethical standing.

References

Carroll, A. B. (1991). The pyramid of corporate social responsibility: Toward the moral management of organizational stakeholders. Business Horizons, 34(4), 39-48.

Donaldson, T., & Dunfee, T. W. (1999). Ties that bind: A social contracts approach to business ethics. Harvard Business Press.

Freeman, R. E. (1984). Strategic management: A stakeholder approach. Pitman.

Gini, A. (1997). Moral leadership and business ethics. In M. E. Bowie (Ed.), Business Ethics: A Kantian Perspective (pp. 104-120). Blackwell Publishers.