EDO 820 Module 8 A Position Paper on Leadership and Rule-Breaking Example

Leadership Raises the Stakes, Not the Permission: A Position Paper on Whether Leaders May Break the Rules

Student Name

Doctor of Education Program, Aspen University

EDO 820: Ethical Issues in Leading Organizations

Instructor Name

Month Day, Year

Leadership Raises the Stakes, Not the Permission: A Position Paper on Whether Leaders May Break the Rules

Across eight modules, Kinloch Family Services has served as a stubborn test of this course's central question. Its chief executive, a successful and well-meaning leader, used a foundation's restricted gift to cover payroll while state payments were late, believing his responsibility to 900 employees justified it. This paper takes a position on the question the case raises: whether the distinctive features of leadership justify breaking rules. The position is that they do not. Leadership's features raise the stakes of rules and the obligation to follow them, and where an exception is truly warranted, they require that it be made openly, so that others can review it. Kinloch and its figures are invented.

Why Leadership Raises the Obligation

Three features distinguish leadership: responsibility for others, high stakes and authority that others lack. Each is usually offered as a reason leaders may sometimes break rules. Each is better understood as a reason they should be especially careful not to. A leader's responsibility for others extends to people outside the organization, such as funders whose trust makes future grants possible and clients of programs whose money is moved. High stakes mean that a leader's mistakes about exceptions do more harm than others' mistakes. And authority means a leader's rule-breaking teaches followers that rules bend for those with power, a lesson that spreads far beyond the act.

The Evidence That the Role Distorts Judgment

Price (2006) developed at book length the argument that ethical failures in leadership are often failures of belief rather than of will. Leaders typically accept moral requirements in general but come to think their own position puts them in a special category where those requirements bend. Because such beliefs feel like moral conviction rather than temptation, ordinary appeals to conscience do not reach them. Price argued that the remedy lies partly in leaders' recognition that their judgments about their own exceptions are especially unreliable.

Hoyt et al. (2013) tested a related claim experimentally. Drawing on social role theory, they examined whether occupying or imagining a leader role changes how people judge rule-breaking. Across studies, people placed in or primed with a leadership role were more inclined than others to see deviations from ethical rules as justified when the deviation served the goals of their group. The role itself, apart from personality, tilted judgment toward the leader's exception.

This evidence answers the question of who should judge exceptions. If the leader role biases the very judgment that an exception requires, the leader cannot be the final judge of his own exception. The Kinloch chief executive's certainty that his choice was the only responsible one is exactly what the research predicts a leader would feel.

A Moral Person and a Moral Manager

Treviño et al. (2000) interviewed senior executives and corporate ethics officers about what earns an executive a name for ethical leadership. They found that such a reputation rests on two pillars. Being a moral person involves personal traits, such as integrity and honesty, behaviors, such as doing the right thing and showing concern for people, and decision making based on values. Being a moral manager involves actively leading others on ethics: role modeling through visible action, using rewards and discipline to reinforce standards and communicating openly about ethics and values. Executives who were moral persons but not moral managers were often seen as ethically neutral, and their organizations took cues from other sources.

The Kinloch chief executive was, by most accounts, a moral person in many respects. But when he asked the finance director to call the transfer a loan, he acted as a manager teaching the opposite of what ethical leadership requires. Leadership's obligation is not only to be good but to show others how to be good, and private rule-breaking fails that obligation even when its motive is kind.

The Strongest Objection

The strongest objection holds that rigid rule-following can betray the people rules exist to protect. Had the chief executive waited, employees might have missed pay, staff might have quit, and children in foster care might have lost workers who knew them. Rules on restricted funds, the objection runs, exist to ensure money serves people, and in a crisis, strict compliance could defeat that purpose.

The reply accepts part of the objection. There may be emergencies in which using restricted money is right. But the objection supports an exception made openly, not one made privately. As Module 5 showed, Kinloch's chief executive could have called the foundation, convened the board's executive committee by phone and described the transfer accurately. Had the foundation and board agreed, the exception would have been legitimate; had they refused, he would have learned that his judgment was not shared. What the objection cannot justify is the path he took: deciding alone, labeling the act misleadingly and informing those affected late or not at all.

Implications

For leaders, the position implies a discipline: when a rule seems not to apply, treat that belief as a warning sign, seek out someone with standing to disagree and make any exception openly and in plain words. For boards, it implies structures that make open exceptions easy and hidden ones hard, the independent finance committee, the restricted-funds policy and the protected reporting routes proposed in Modules 6 and 7. For Kinloch, it implies that the chief executive's return, if the board permits it, should depend on his accepting these constraints, not on his good intentions, which were never in doubt.

Conclusion

Leadership's distinctive features do not justify breaking rules; they raise the obligation to follow them and to make any exception in the open. Price explains why leaders come to believe in their own exceptions, Hoyt, Price and Poatsy show that the leader role itself biases that belief and Treviño, Hartman and Brown show that leaders must manage others' ethics as well as their own. The Kinloch case shows what happens when a good leader forgets that his conviction is not enough.

References

Hoyt, C. L., Price, T. L., & Poatsy, L. (2013). The social role theory of unethical leadership. The Leadership Quarterly, 24(5), 712-723. https://doi.org/10.1016/j.leaqua.2013.07.001

Price, T. L. (2006). Understanding ethical failures in leadership. Cambridge University Press.

Treviño, L. K., Hartman, L. P., & Brown, M. (2000). Moral person and moral manager: How executives develop a reputation for ethical leadership. California Management Review, 42(4), 128-142. https://doi.org/10.2307/41166057