Chapter 05 – Leadership Ethics and Values
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Leader
Part 2: Focus on the Leader
Chapter 5: Values, Ethics, and Character
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Chapter 5 Outline
Values, Ethics, and Character
Introduction
Leadership and “Doing the Right Things”
Values
Moral Reasoning and Character-Based Leadership
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Key Learning Points
Introduction
This chapter builds on the concepts of power and influence addressed in the previous chapter.
Leaders can use power for good or ill, and a leader’s personal values and ethical code may be
Leadership and “Doing the Right Things”
The phrase “doing what is right” sounds deceptively simple. Leaders will invariably be faced with
ethical dilemmas that require great moral courage and a clear understanding of their values, the
Values
In order to improve and better understand how leaders (and followers) can make more ethical
decisions, it is imperative leaders and followers have a solid understanding of what their values are
Moral Reasoning and Character-Based Leadership
Moral reasoning refers to the process leaders use to make determinations about ethical and unethical
behavior. In this sense, it does not directly relate to an individual’s morality, per se, but rather
focuses on the decision-making process when faced with morally and ethically challenging problems.
Values play a key role in the moral reasoning process because value differences among individuals
Character-Based Approaches to Leadership
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Ethical leadership involves the two core components of the moral person (a principle decision maker
who cares for people and society) and the moral manager (managers who make ethics an explicit
mission in their leadership and management agenda). Authentic leadership is grounded in the
The Roles of Ethics and Values in Organizational Leadership
In any organization, the top leadership’s collective values play a significant role in
determining the dominant values throughout the organization, just as an individual leader’s
make sure clear values guide everyone’s behavior in the organization.
Leading by Example: The Good, The Bad, and The Ugly
Ethical leadership is perhaps best perpetuated throughout the organization and exemplified by
Creating and Sustaining an Ethical Climate
Leaders are responsible for establishing an ethical climate in their organization. This is
accomplished through several leadership “fronts” including: formal ethics policies and procedures;
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Brief Definitions of the Key Terms for Chapter 5
Ethics: Principles of right conduct or a system of moral values.
Theory X: A pessimistic view of others resulting in managers who rely heavily on coercive,
external-control methods to motivate workers because workers are not industrious or motivated
by nature.
Dual-process theory: Moral judgments dealing primarily with “rights” and “duties” are made by
automatic emotional responses while moral judgments made on a more utilitarian basis are made
more cognitively.
Ethical dilemmas: Situations where a person is forced to choose between two courses of action
that could both be considered “right”.
Truth vs. loyalty ethical dilemmas: Acting honestly when doing so could compromise real or
the kinds of standards everyone should uphold all the time, whatever the situation.
Care-based thinking: A “do what you want others to do to you” approach that applies the
criterion of reversibility in determining the rightness of actions.
Implicit prejudice: Judgments about some group being systematically biased without the
judger’s awareness.
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Moral justification: Involves reinterpreting otherwise immoral behavior in terms of a higher
purpose, which can be seen most readily in the behaviors of combatants in war.
Euphemistic labeling: Dissociating behaviors from one’s espoused moral principles by using
the decisions they make.
Dehumanization: Another way of avoiding moral consequences for our actions that allows an
individual to treat others badly when they are assigned epithets that make them less than human.
Attribution of blame: An attempt to justify immoral behavior by claiming that it was caused by
someone else’s behavior and not their own.
Moral manager: A manager who strives to “make ethics an explicit part of their leadership
agenda by communicating an ethics and values message, by visibly and intentionally role
modeling ethical behavior.”
Authentic leadership: Leadership that is characterized by exhibiting a consistency between
values, beliefs, and actions.
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Unethical climate: A climate in which questionable or outright unethical behavior exists with
little action taken to correct such behavior, or (worse) where such misbehavior is even condoned.
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Overview of the Learning Resources for Chapter 5
Exercise 5-1: Values Rummy. In this highly interactive 25-minute exercise, students pass out a deck of
values cards, and then play a game of rummy in order to get the hand that best represents their top six
values.
Exercise 5-2: Values Auction. In this highly interactive 45-minute exercise, students allocate points to
Exercise 5-3: Personal Values Priority Exercise. In this 40-minute exercise, students are required to think
Exercise 5-4: The Motives, Values, and Preferences Inventory. Instructions for completing this on-line
Exercise 5-5: Voting with your Feet. In this 30-minute experiential exercise, students are presented with
Exercise 5-7: Survivor. This 25-minute exercise asks students to pick the 6 out of 10 individuals who will
get to restart the human race after a nuclear holocaust.
Exercise 5-9: Breaking the Chain. This highly interactive experiential exercise gets at the importance of
values, teamwork, and how individuals and groups handle ethical dilemmas.
Exercise 5-10: Values and the Classics. In this 30-minute exercise, student teams read over excerpts from
Billy Budd and Antigone and discuss the moral dilemmas and values represented in these classics.
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Sample Lesson Plans for Chapter 5
Lesson 1: 60 minutes
Pre-work: Exercise 5-3, Personal Values Priority Exercise.
Lesson Plan: The overall goal for this lesson is for students to develop a more robust understanding of
the importance of values and how people prioritize their personal values.
• Discuss what values are and how they develop (5 minutes).
• Complete Exercise 5-3, Personal Values Priority Exercise (40–60 minutes).
o Have students complete the 2-page handout in Exercise 5-3.
Lesson 2: 60 minutes
Pre-work: Exercise 5-5, Voting with Your Feet. Prior to the lesson, instructors will need to create all of
the materials required for the exercise (as outlined in the full explanation of the exercise). Additionally,
select the specific “ethical dilemmas” for your class or situation (or design statements that are more
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Minicase, “Balancing Priorities at Clif Bar,” Sample Answers
Question 1: Without knowing Gary Erickson’s age, where would you guess he falls in the
four generations of workers as delineated by Zemke?
It would be most likely to classify Erickson as a “GenXer” based on several key factors outlined
Question 2: Consider the terminal and instrumental values in Table 5.1. Recalling that
leaders are motivated to act consistently with their values, what values appear to be most
important to Gary Erickson?
Terminal Values
An exciting life—It would seem that Erickson values an exciting life. He is an avid cyclist and
entrepreneur.
A sense of accomplishment—Erickson would appear to value accomplishment. This is
exemplified in the story of how he started “Clif Bar”–deciding he could do better than the
Instrumental Values
Being responsible—Erickson appears to value responsibility as evidenced by his concern for
follow-through on his company vision, and the environmental and social programs he started at
the company.
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Question 3: Clif Bar, Inc. possesses a definite set of organizational values. If you visit the
Warming” and “Register to Vote” are just as prominent as information about the product.
Knowing some of the values of Gary Erickson, how closely aligned do you think the
organizational values are to the way the company actually operates?
The Director of Operations’ comment, “It’s a balancing act,” likely captures the essence of the
issue between values and business. Ultimately, in order to do social and environmental programs
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Chapter 5 Exercises & Instructions
Exercise 5-1
Exercise Title: Values Rummy
Purpose: To help people prioritize their personal values.
Summary: This is a highly engaging and eye-opening exercise that can really help people prioritize their
values. Prior to the exercise, instructors should write down the following labels on 3 x 5 cards.
Harmony Competence
Job Security Change
Advancement Responsibility
Instructors should make three copies of each value, so that the deck of values consists of a total of 72
cards. Break students out into groups of 5–7, and tell them that they are going to play a game called
Values Rummy. (Instructors will need one deck of 72 cards for each 5–7 person group). Instructors
should then tell students that they are starting the game with no values, and they will have six rounds to
At the end of six rounds, have group members take a sheet of paper and rank order the values in their
hand. At this time, they can also add any values that they feel strongly about but were not in their hand.
Once they have identified their top six personal values, instructors should then ask group members the
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This exercise takes 25 minutes to complete.
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Exercise 5-2
Exercise Title: Values Auction
Purpose: To demonstrate the importance of values, what people are willing to sacrifice in order to live
according to their values, and the kinds of tradeoffs people make with their values.
Summary: Ask students to form groups of 4–6 people, and then ask them to review the values listed on
the next page. They should be given 2 or 3 minutes to check off their five most important values, and then
another 7–10 minutes to discuss their ratings in their small groups.
Once all the students are finished allocating their points, the instructor runs a values auction. The
instructor plays the role of an auctioneer and solicits bids from the students, starting with 50 points. The
student with the winning bid “wins” the value, but now has that many fewer points to bid on the other
This exercise takes about 45 minutes to complete.
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Values Handout
Top
Key Values Five Points
Competence: being seen as an expert _____ _____
Science: working with data and doing research _____ _____
Job Security: having a predictable future _____ _____
Hedonism: having a good time _____ _____
Integrity: being seen as honest and trustworthy _____ _____
Religion: living a spiritual life _____ _____
Health: being in good physical condition _____ _____
Patriotism: believing in country _____ _____
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Stress-Free: working in a stress free environment _____ _____
Chapter 05 – Leadership Ethics and Values
Exercise 5-3
Exercise Title: Personal Values Priority Exercise
Purpose: To demonstrate the importance of values, how (and why) we prioritize our values, and what
effect these decisions have on who we are and how we interact with other people. Additionally, this
exercise will highlight the tradeoffs people are willing to make and what they are willing to sacrifice in
order to live according to their values.
Summary: Ask students to think about and reflect on the values that are important in their lives. Students
After all students have completed the exercise, have them form small groups (3–4 students) to discuss the
process they used to prioritize the values, what impacts their values have on their personal life as well as
the interactions they have with others (in both leadership and followership roles), and the reflection
questions provided on the page following the priorities exercise.