Abstract
The relationship between leadership, trustworthiness and ethical stewardship is examined in Caldwell et al.'s (2010) "Leadership, Trustworthiness and Ethical Stewardship." The authors posit that ethical stewardship leads to trustworthiness, which is an important facet of leadership in organizations and businesses. In this essay, these three primary facets are reviewed and examined, the individual relationships weighed against other research on the topic. A subjective view of these facets is also included, considering the mediating lens as a potential drawback to the theory that behaving in an ethical and trustworthy way will lead to the perception of an effective leader by employees and stakeholders.
In "Leadership, Trustworthiness, and Ethical Stewardship," Caldwell et al. (2010) examines "the relationships between leadership, perception of interpersonal trustworthiness, and the elements of ethical stewardship - a construct of organizational governance that has received increasing discussion in both the academic and practitioner literatures" (p. 497). These three traits are considered to be intricately connected, and all essential for effective leadership of an organization or business. In this paper, this article will be reviewed, and its stance on the aforementioned three subjects examined.
Caldwell et al.'s discussion of leadership is extremely interesting. The authors center their theory of leadership upon a model from Chemers (1997), which denotes three critical tasks that leaders must perform. First, they must conduct relationship development - interacting with one's coworkers, cultivating relationships and keeps track of how they are performing and getting along within the workspace. Second, resource utilization takes place, where leaders make use of whatever financial and material resources are made available to them in the best way possible. Finally, there is image management, where a leader does whatever they can to cultivate an image that follows what their employees and colleagues expect of them. (p. 498). All of these tasks help to enhance internal integration and external adaptation, dealing with intracompany conflicts and synchronicity as well as the overall performance and reputation of the company.
The most interesting attribute of leadership that is implicitly covered in this article is the complex nature of the leader-follower relationship; often, leadership is seen as a social transaction between people at two distinct levels of responsibility within a company, and it is the burden of the leader to "impress" the follower (Dirks & Ferrin, 2002). The best type of leader for this kind of transaction is the transformational leader, whose strategy is to "make followers more aware of the importance and values of task outcomes, activate their higher-order needs, and induce them to transcend self-interests for the sake of the organization" (Podsakoff, p. 108). This article presumes the transformational leader as the definitive leader, given the importance of follower respect and acceptance as a facet of leadership.
Caldwell et al. also discusses trustworthiness as a concrete, independent principle, in terms of leadership. For the authors, trustworthiness is connected to leadership via the social contracts that people form between themselves and leaders, as well as the leaders' fulfillment of this contract. In order for a leader to be trusted, a leader must have ability, benevolence and integrity (p. 500). Ability involves the skill of the leader in their chosen field, benevolence involves the inherent goodness or benefit the leader has to the employee, and integrity involves the leader having a shared set of principles with the trustor - principles that will be followed adequately.
Essentially, the reasons that people trust are varied, and can be different depending on particular interest and their own personal history and preference (p. 500). When leaders behave with accountability, as well as the aforementioned three attributes, a leader has the potential to be considered trustworthy. When values and commitments are honored by the trustee, the trustor has precedent that they will do what they say. In a leader, this quality manages to garner greater respect from their coworkers. Combining the two aforementioned models, Caldwell et al. posit that "leadership behaviors associated with resource utilizationrelationship development [and] image management influence individuals' perceptions of interpersonal trustworthiness" (p. 500).
Caldwell's assessment of the relationship between trust and leadership is fairly sound; the model of leadership chosen to represent it is clear and concise, creating clear hypotheses that they sought to address in their study. According to other research, however, there are many types of leadership, some of which may be less correlated to trust than others. Transformational leadership, for instance, is very highly correlated with trust; this is due to trust-based behavior descriptions measuring one's effectiveness as a leader, and employees' satisfaction with said leader (Dirks & Ferrin, p. 32).
Thirdly, Caldwell et al. link ethical stewardship to leadership, citing stakeholder theory and others to systems of governance. In essence, leaders have an ethical responsibility to their shareholders and other stakeholders to lead effectively, as they have placed their faith in him to account for their investment. Stewardship theory is defined as "a higher level duty of governance in which the motivations of the manager are based on pro-organizational rather than self-interest behavior" (p. 501). Stewards integrate shared interests, and work toward the self-actualization of an organization and the workers within it. When a leader exhibits ethical stewardship, they attempt to work hard towards generating profits for their company while simultaneously forming relationships with stakeholders that show maximum commitment from them (p. 501). The ultimate theory surrounding ethical stewardship suggested by Caldwell et al. involves the abandonment of self-interest in favor of providing effective service to the organization. This would then benefit the leader as well, through the proper usage of resources and employees in an ethical manner to create profit and prosperity for this business.
Ethical stewardship is perceived as the ability to honor obligations to one's stakeholders; in this place, trustworthiness is earned through the ability to see beyond one's own individual advancement in the company, and making use of leadership resources for the greater good. From a human resources perspective, ethical stewardship most definitely enhances the leader-follower relationship mentioned previously; by behaving in a selfless way, it sets a precedent seen by coworkers and stakeholders that the leader will see to their needs before his or her own. In this way, trustworthiness of the leader is established through ethical stewardship itself (Caldwell & Troung et al., 2011).
There is a very interesting relationship shown between stewardship and agency theory, a much different one than with stakeholder theory. Agency theory "places high value on competence in achieving increased profitability," often doing so in order to promote their own self-interest (Podrug, 2008). This belies the benevolence and trustworthiness that ethical stewardship cultivates; however, research indicates that agency theory is still a dominating force in the worlds of business and academia (Podrug, 2008). Ideally, with the help of ethical stewardship and the establishment of a pattern of trustworthiness, leaders can behave in a more socially and economically acceptable way, moving from agency theory to the idealized stakeholder theory.
Connecting the three ideas of leadership, trustworthiness and ethical stewardship involves linking the aforementioned constructs into a clear through line of thought and theory. In essence, in order to lead effectively, trustworthiness and the perceived trust of one's employees is absolutely important. Just as important, as well, is the ability to handle and run the company effectively, offering ethical stewardship to the stakeholders who stand to lose if a leader performs ineffectively (p. 502). Often, trustworthiness is determined through the legitimate, objective ethical stewardship of the company, which then translates to one's perception as a leader. Ethical stewardship and trustworthiness are two separate, though not mutually exclusive, means to achieve the end of ethical leadership. They are also subjectively assessed, as one's performance as leader does not strictly dictate just how much an employee trusts them, nor do they determine how well they are perceived to run the company. This is done through the mediating lens - the perspective from which the outside party views the leader's ethical stewardship and trustworthiness (p. 503).
The issue of the mediating lens is one that colors my perception of Caldwell et al.'s article - they have very good points that these positive traits can often lead to the creation of effective leaders; however, the perception of an effective leader is not always the objective sign of one. As a result, a leader may seem trustworthy, usually by displaying the model's signature signs of ability, benevolence and integrity, but not actually back up that faith with ethical stewardship. At the same time, there are significant gaps in perception that can also lead competent, effective leaders to lose faith in their ability to lead, due to few people trusting them because of their own mediating lens. With this in mind, I am not fully convinced of the effectiveness of a linear model of behavior emphasizing trustworthy and ethical behaviors, because it will not necessarily guarantee a linear response.
Despite the doubt that is experienced regarding these traits, based on the mediating lens coloring perceptions of actual performance, the ethical basis for behaving as a good leader remains sound. As the authors posit, "Honoring a model of leadership that rises to the level of ethical stewardship can enable businesses to build trust, improve profitability, and achieve more effective results long-term" (p. 509). Whether or not the mediating lens allows stakeholders, employees and other witnesses to see the effectiveness of one's leadership, the theory holds that leaders should attempt to follow these values in order to create a more trustworthy, ethically sound way of leading. Whether or not they achieve trustworthiness is never assured; however, the effort must be made nonetheless.
In conclusion, Caldwell et al. make a fairly convincing point of the importance of trustworthiness and ethical stewardship in effective leadership. Putting one's own self-interest below that of the company's, and seeing to the needs of stakeholders, displays traits of ability, benevolence, and integrity that will lead to the perception by said stakeholders of an effective leader. These actions are part and parcel of the fulfillment of the concept of image management, as the leader creates an ideal version of themselves through their actions and work philosophies. Other research supports the importance of these facets, though the mediating lens still presents a problem in creating a guaranteed way to increase stakeholder and employee confidence in a leader.
References
Caldwell, C., Hayes, L. A., & Long, D. T. (2010). Leadership, trustworthiness, and ethical
scholarship. Journal of Business Ethics 96: 497-512.
Caldwell, C., Truong D. X., Linh, P.T., & Tuan, A. (2011). Strategic human resource
management as ethical stewardship. Journal of Business Ethics 98(1): 171-182.
Dirks, K. T., & Ferris, D. L. (2002). Trust in leadership: meta-analytic findings and implications
for research and practice. Journal of Applied Psychology 87: 611-628.
Podrug, N. (2008). Stewardship management behavior and trust as source of sustainable
competitive advantage in 21st century. Presentation at 16th EDAMBA Summer
Academy: Soreze, France.
Podsakoff, P. M., MacKenzie, S.B., Moorman, R.H., & Fetter., R. (1990). Transformational
leader behaviors and their effects on followers' trust in leader, satisfaction, and
organizational citizenship behaviors. Leadership Quarterly 1(2): 107-142.
