Academic journal article SAM Advanced Management Journal

An Empirical Study on the Relationships between Authentic Leadership and Organizational Trust by Industry Segment

Academic journal article SAM Advanced Management Journal

An Empirical Study on the Relationships between Authentic Leadership and Organizational Trust by Industry Segment

Article excerpt

Introduction

After the Revolutionary War battle at Yorktown in 1783, General George Washington informed his army of the cessation of hostilities between the United States and Great Britain. Several years later, in an effort to secure ratification of the new Constitution, James Madison convinced Washington, then a private citizen, to preside at the convention as a signal of strength and leadership (Pary and Allison, 2009). Why did the populous have such admiration and respect for a man whom most only knew through reputation? If we look at the converse in relation to political characters of present day, sadly we find ourselves searching for someone who even approaches this example of authentic leadership. Just as Washington's presence had a significant influential effect on followership, today we thirst for true and real authentic leadership. Interest in authentic leadership increased in a period in which there was societal unrest and instability. High-profile cases of unethical corrupt and corporate leadership provided a catalyst for more ethical and constructed leadership (Luthans and Avolio, 2003).

According to Northouse (2013), authentic leadership represents one of the newest areas of research and is still in the formative stages of development. Corporate scandals, management malfeasance, ethical lapses by our politicians, and a shift in cultural and societal norms have all contributed to a continuing demand for greater accountability of organizational leaders in the public and private sectors. Luthans and Avolio (2003) initially defined authentic leadership "as a process that draws from both positive psychological capacities and a highly developed organizational context, which results in both greater self-awareness and self-regulated positive behaviors on the part of leaders and associates, fostering positive self-development. Also, Shamir and Eilam (2005), described authentic leaders as people who exhibit genuine leadership from conviction and are originals, not copies. Their theoretical framework is focused on an interpersonal approach with a leader having the following attributes: (a) "the role of the leader is a central component of their self-concept, (b) they have achieved a high level of self-resolution or self-concept clarity, (c) their goals are self-concordant, and (d) their behavior is self-expressive."

Recently, researchers have begun to address followership as influenced by authentic leaders. One such model presented by Gardner et al. (2005) produces favorable outcomes such as trust and workplace well-being (job satisfaction). In this context this study will focus on the outcome of leader-followership assessment.

According to Northouse (2013), authentic leadership works when leaders and followers come together to define their concerns and determine the right thing to do about them. Authentic leadership tries to determine what is truly good for the leader, followers, and organization. Research assessing the relation between follower and work behaviors is still scarce. However, preliminary evidence supports the relationship between authentic leadership and certain behavioral outcomes. Walumbwa et al. (2008) found authentic leadership to be a significant predictor of followers' trust and satisfaction. Another study by Clapp-Smith et al. (2009) found authentic leadership to be positively related to employee performance, reflecting trust in the leader. Walumbwa et al. (2008) theorizes that authentic leadership is a positive predictor in followers' outcomes, such as job satisfaction.

Based on these recent studies focusing on the followership constructs of authentic leadership, the intent of this study is to examine further the effect of authentic leadership on the follower and corresponding outcomes, such as developing trust in the organization. Our empirical data shows a high correlation between authentic leadership and organizational trust and concludes that authentic leadership is a reliable predictor of the development of organizational trust in every industry segment we studied. …

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