In the present day world white-collar crime (corruption, fraud and other related economical and financial felonies) are meeting more and more often. The elements of corruption could be found in the governmental structures, within small and large business corporation and many other structures. High level of corruption characterizes social and economical development of the country as very low. Still even well developed countries could not avoid corruption scandals such, Enron would be a good example. This scandalous story is referred to as the most loud white collar crime of the 21st century. The leaders of the company were deeply involved in financial fraud and well known for their close connection with governmental leaders of that period. Still the corruption and other related financial crimes could be prevented and the emotional intelligence is core idea that could help contemporary leaders to meet the growing demands of present day leadership.
First systematic studies relating to emotional intelligence are traditionally dating back to the 90-s of the 20th century. The meaning of the term relates to the article by J. F. Mayer and P. Salovey: “Emotional intelligence refers to an ability to recognize the meanings of emotion and their relationships, and to reason and problem-solve on the basis of them. Emotional intelligence is involved in the capacity to perceive emotions, assimilate emotion-related feelings, understand the information of those emotions, and manage them” (Mayer, Salovey; 1999). Both authors were intended to study the subject and provided revolutionary ideas that helped to understand psychological phenomenon of emotional intelligence and it relation to contemporary business, leadership in particular.
The necessity of understanding emotional intelligence within the leadership is quite a contradictory question as actually does not fit to the classical (autocratic) model of leadership that was actually developed through history It does not fit for the present day realities: “Associated with great figures of military history and conjure up charismatic and sometimes despotic images. However, people often use the same language for leadership today – bold, brave and tough with a strong sense of purpose and resolve” (Childs, 2004). Still there could be outlined several factors explaining why contemporary leadership needs emotional intelligence:
- today’s workforce does not accept the autocratic style often adopted by leaders following historical models of leadership.
- leadership has had to evolve to match a growing sense of democracy and independence in the workforce
- employees now have far more options and choices than the foot soldiers of yesterday (Childs, 2004).
Dealing with contemporary needs of leadership, there should be mentioned such thing as empowerment, which becomes more and more significant in the present day business. Contemprary leader should understand the necessity of democratization within his company going far beyong the demanding style of the past. In the present day leadership the stress is made on counseling, co-operation and democatic style. The following list would give some the new demands to contemporary leader:
- consultation and involvement – but leaders still get criticised for not having and communicating a compelling vision and purpose
- autonomy and freedom – but leaders are still expected to take full responsibility when things go wrong
- opportunities for growth, challenge and glory – but leaders must be on hand to coach and mentor us so that we develop our potential
- inclusion and team spirit – but we still want our leaders to give us individual recognition and acknowledgement (Childs, 2004).
We see that contemporary demands for the leaders are very high, the same time the significance of the the meotional intelligence is obvious.
Leadership Traits and Their Relation to the Corruption
According to the recent investigations different traits of a leader could either promote or prevent corruption. As it was mentioned earlier charismatic leaders of the past provided a huge influence on the present day leadership and now some leaders use their experience. Charismatic leader has a number of characterizing traits that are typical for their style of leadership: “In this description are charismatic leaders’ self-confidence in their own beliefs, abilities, and actions, and strong conviction about their ideas. Charismatic leaders do not doubt themselves and have “unwavering beliefs”. This projected self-confidence could have great positive effects, including increased motivation of followers and subsequent improved performance” (Pfarrer, 2004). For many years charismatic leadership was described as extremely positive without mentioning so called “dark side of charisma”, which is also present and could be confronted to the positive traits that could support and motivate the followers of such leader: “ The charismatic leader’s confidence and “lack of internal conflict” (Kets de Vries, 1993; Nahavandi, 2000, p. 178) could also contribute to leader arrogance and a skewed moral code (absence of conscience). If these leaders never experience self-doubt, they might not experience a distinct moral sense of right and wrong. Charismatic leaders’ ability to excite followers to follow their mission, and their impression management skills in interacting with stakeholders, could also lead to increased opportunity for corruption. These special abilities of charismatic leaders could allow them to lie with greater ease, potentially creating “facades” that could deceive those who might be averse to illegal or questionable organizational activities. Facades are false exterior images that are different from true internal practices. For example, a charismatic leader might present an external facade to stakeholders detailing greater organizational profits than what actually exists. Obviously, impression management skills could be a powerful tool for a leader to hide any illegal or corrupt behaviors within the organization” (Pfarrer, 2004). Everything of the described could perfectly suit to the Enron case, where shareholders were “charmed” by charismatic leaders and lost everything. The negative experience has a significant impact on the developmental practices. That is why contemporary leadership is shifted to empowerment strategy, to avoid concentration of great powers within one person (or small group of people) who could use their leadership powers for their own purpose as it happened with Enron, where thousand of people became the victims of white-collar crime.
The Positive Influence of Emotional Intelligence on Preventing Leadership Corruption and Unethical Behaviour.
Some refer to the emotional intelligence as “serving leadership”, but I can’t agree with this statement. The old-fashioned strategies built around one particular person (or a small group of people) should be left in the past. Orienting on productivity and efficiency of the company the leader should not forget about people who provide this particular efficiency and productivity. The ages of treating people as thoughtless beings are left in the past and new collaborative and empowerment oriented strategy are the new word in Leadership, which would have positive influence of the further development on business strategies. EI oriented leader is a good listener first of all: “People who are high in emotional intelligence know how to listen to their emotions and regulate their intensity so they are not hijacked by them. Emotionally intelligent people know how to keep disruptive emotions in check. Emotionally intelligent people sense the effect their emotions have on others. Emotionally intelligent people can laugh at themselves. Emotionally intelligence people know how to deploy their strengths and compensate for their weaknesses” (Kramer, 2002). What does it mean? It means that trusting and empowering followers, listening to their opinion (and taking it into consideration, while decision making), reducing conflict situation and co-operating with workers the leader promotes interpersonal skills and creates definitely new strategy, that deals with shifting authorities. These shift expects personal initiative from workers, their self-motivation with empowerment and certain it deals with question of spreading powers. The powers would not be concentrated within one or several people, whose opinion is decisive. It turn out that the powers would be spread among the all participants of the process. Team strategy one of the most recent invention in management is deeply EI oriented. The followers would be well aware about present day situation of the company and could not be lied about perfect conditions and wonderful statement of the enterprise as it happened with Enron. The EI oriented leadership would give the employers an ability to participate more actively in the life of the company.
In the end I would like to make a stress on the developmental process. Time does not stand still and new strategies are being developed recently. Yet, the ideas suggested by emotional intelligence correspond to contemporary vision on management from the leaders’ side as well as from employees. With passing years the demands to leadership has grown a lot and now emotional intelligence is considered to be an efficient idea to struggle corporate corruption, which past strategies, oriented on one powerful leader supported. Perfect illustration for emotional intelligence would be team oriented strategic planning, supposing empowerment of employes, involvement them in the decision making and promoting their personal and professional skills within the individually oriented groups, where each is responsible for corresponding sector of work.
1. Pfarrer, M. D. (June 22, 2004). Heroes or villains? Corruption and the charismatic leader. Journal of Leadership & Organizational Studies.
2. Kramer. R. (2002). Beyond Max Weber: Emotional Intelligence and Public Leadership. NISPAcee Proceedings from the NISPAcee Conference.
3. Mayer J., Salovey P., Caruso D. (1999). Emotional Intelligence Meets Traditional Standards for an Intelligence. Elsevier Science Inc.
4. Childs R. (2004). Emotional Intelligence and Leadership. Team Technology.