Ethical Turnarounds and Transformational Leadership: A Global Imperative for Corporate Social Responsibility

摘要

A company's social responsibility and its sustainable competitiveness must rest on a culture grounded in appropriate ethical values. Accountability for this foundation lies with the corporate leadership, which is responsible for establishing organizational values and culture. When a breach occurs in this leadership process, or when a transition-economy organization is entering the global arena, an ethical turnaround is generally needed. We created this term to describe the leadership process needed to regain, or initially establish, corporate credibility and legitimacy in the eyes of stakeholders. These leadership requirements go beyond those needed in a strategic turnaround since they must help resuscitate an organization's culture and ethical underpinnings. This article discusses transformational leadership during ethical turnarounds in developed economies (focusing on Tyco) and in transition economies (focusing on Troika Dialog in Russia). We conclude with implications for business leaders in both economic settings.