Ethical leadership does not only entail portrayal of good character by a leader, but it also considers the characters of followers. Ethical leadership accounts for the contexts that a leader and the followers encounter, the processes and skills of the leader, and the eventual outcomes that arise. First and foremost, leaders are their own organizational members. This implies that the values, vision, and purpose that they hold are for organizational benefit. Leaders should not only perceive their constituents as followers, but also as key stakeholders working towards attainment of common, goals, values, and vision. Within a comprehension of ethical ideals, ethical leaders embody the vision, values, and purpose of a corporation and constituents.
Leadership ethical views vary depending on organizational and cultural settings. In this assignment, a one Chinese and one American company would be used. Cultural differences are clearly reflected in business behaviors of an organization. China’s history dates back to more than 5, 000 years. Numerous current ideas of virtues and moral originated thousands of years back. Organizational policies are still influenced by schools of philosophies that originated in ancient times. Leadership ethical views in Chinese Corporations are mainly influenced by Confucianism, which was developed between 500 and 400BC. Confucianism lays emphasis on governmental and personal relationships, justice, correctness of social relationships, and sincerity. This partly explains why most Chinese corporations have a strong hierarchical sense (Chan & Lam, 2008).
In most Chinese companies that are privately-owned, company ownership is concentrated on a few people or one person. The full capacity to make decision is bestowed upon the company owner. Transaction negotiations are done by lower level officers or delegates. This implies that incomplete or misinterpreted information may be used to make decisions. This is contrary to United States corporations where all the stakeholders are involved in the process of making decisions. Additionally, the corporations protect their rights using the United States legal system (Ardichvili & Mitchell, 2008).
In the year 1949, China was taken over by the Communist Party under the leadership of Mao. A proclamation made by Mao was that “half of the sky was held up by women”. This clearly shows that the Chinese Constitution protects equal rights for women. Women no longer take the last names of their husbands, and most of them began working outside their homes long time ago. Currently, women are employed in virtually all occupations and professions in China. Women have been known to hold several highly-ranked political positions, and some are successful entrepreneurs. However, this does not necessarily mean that gender equality has been totally achieved. Given the size of China’s population, the number of women in leadership posts is very low (Chan, 2008). The same case has been witnessed in America, where women are still considered to be somehow inferior to their male counterparts.
A Chinese company that can be used as an example is Sinopec, a petroleum and chemical corporation in China. The company focuses on building workplace diversity. Female workers and those from different ethnic background hold different posts in the company. Sinopec established a Women Labor Union to specially protect female workforce. The main reason for doing so was to empower female employees. This clearly shows that the company leadership ethics strongly advocates for gender and ethnic equality. This is in line with the findings that women are respected in the Chinese culture and allowed to hold different professional positions (Chan, 2008).
Bribery has been a major issue of concern in many Chinese corporations. Despite the fact that the economy of China has been privatized over the last few years, a strong control and influence over many enterprise activities are still maintained by the government. A company’s strategic decision and success opportunity can be greatly influenced by a man of power. In the year 2009, Sinopec’s former chairman, Chen Tonghai, was found guilty of corruption. Because of taking bribes worth $ 28.7 million, Chen was given a suspended death sentence (McDonald, 2009). This clearly shows that Chinese corporations lack strong policies against corruption. Leadership ethics is somehow lenient on bribery.
PepsiCo, an American multinational corporation is the second example. According to the company leadership, practices such as software piracy, gift giving, sharing insider information, nepotism, and dishonesty in advertising are rated as more unethical, contrary to its Chinese counterpart, Sinopec. Any form of bribery is not tolerated at PepsiCo (PepsiCo Inc., 2011). The company has a code of conduct that is applicable to all officers, associates, directors, subsidiaries and to every transaction made. Decisions are made by all stakeholders, which is contrary to Chinese corporations where making decisions is the sole responsibility of the business owner.
Although most American companies have few women in management posts, PepsiCo is exceptional. This exceptionality presents a key similarity with Sinopec in that, both companies value gender equality. Central to the operations of the company is diversity and inclusion, especially gender equality (PepsiCo Inc., 2011). This clearly shows that the company leadership ethics holds great value for gender equality.
In Conclusion, it is evident that cultural differences have a major influence on business behavior. Despite the differences, it is essential for leaders to devote their energy and time in creating organizational value.
Ardichvili, A., & Mitchell, J. (2008) Characteristics of Ethical Business Cultures, Journal
of Business Ethics, 85, 445-451
Chan, A., & Lam, K. (2008) Business Ethics in Greater China: An Introduction. Journal
of Business Ethics
McDonald, M. (2009) Beijing Courts Convicts Ex-Sinopec Chief of Bribery, New York
PepsiCo Inc. (2011) Homepage, retrieved on July 14, 2012 from