Business ethics and firm economic performance have traditionally often been regarded as mutually exclusive ends. We challenge this “either-or” belief and analyze when and how ethical firm leadership and firm performance may harmonize well. In extension of earlier research on ethical leadership and performance at the individual and team level, we study the context–dependency of the organization level relationship between CEO ethical leadership and firm performance. We propose a moderated mediation model of the link between CEO ethical leadership and firm (...) performance, identifying mediating and moderating variables unique to the organization-level of analysis. CEO ethical leadership is argued to work through organizational ethical culture which promotes firm performance under the condition that there is a strong corporate ethics program in place. Results from a multisource cross-sectional study, in which we surveyed 145 participants from 32 organizations and validated organizational performance ratings by objective performance data, showed support for our conceptual model. (shrink)

To advance current knowledge on ethical decision-making in organizations, we integrate two perspectives that have thus far developed independently: the organizational identification perspective and the ethical climate perspective. We illustrate the interaction between these perspectives in two studies, in which we presented participants with moral business dilemmas. Specifically, we found that organizational identification increased moral decision-making only when the organization’s climate was perceived to be ethical. In addition, we disentangle this effect in Study 2 from participants’ moral identity. We argue (...) that the interactive influence of organizational identification and ethical climate, rather than the independent influence of either of these perspectives, is crucial for understanding moral decision-making in organizations. (shrink)

Leading social innovation is challenging. Creating enduring social innovation requires navigating the tension of simultaneously engaging top-down and shared leadership. We outline the crux of the challenge and provide key takeaways and practical advice for the tandem deployment of top-down and shared leadership for social innovation success.