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We extend current research about corporate corruption and charismatic leadership by developing a multidimensional model involving stakeholder pressures, environmental factors, charismatic leaders, and their followers. Specifically, we propose that stakeholder pressures place strong demands on leaders of organizations, increasing the motive for, and likelihood of, corrupt practices. Furthermore, opportunity for corruption increases due to specific environmental factors, and through charismatic leaders' ability to create façades and influence followers to participate in, enable, or hide wrongdoing. We examine the implications of the "dark side " of charismatic leadership, that is, a "villain " charismatic leader concept rather than focusing on the "heroic " capabilities often studied in leadership research, and answer the call for studies that incorporate situational context (e.g., environmental pressures) into leadership research (Conger, 1999).
Corruption is not new. Indeed, tales of the powerful and charismatic abusing their positions for organizational and personal gain are as old as recorded history. Despite the long trail of deceit, lies, and greed, however, corporate corruption appears to grasp the public's attention in waves, reaching a crescendo at different periods and then fading into the background. Now appears to be one of those times of "mass appeal," so to speak. Names like Tyco, Enron, and WorldCom dot the airwaves, as do now-familiar faces of notorious leaders like Kozlowski, Ebbers, and Stewart. Public airings of grievances have illuminated what scholars have known for years-that corporate corruption is not victimless. Instead, it is a "societal problem whose magnitude is difficult to overestimate", incurring a cost to society far greater than that of ordinary crime. (Szwajkowski, 1985, p.559)
While corporate corruption may not be a novel topic among researchers, the study of the interaction of stakeholder pressures, environmental variables, charismatic leadership, and follower attributes on organizational corruption, is. We extend current research about corporate corruption and charismatic leadership
by developing a multidimensional model involving these four constructs. Our proposed model examines the direct relationship between stakeholder pressures and corporate corruption, as well as the moderating influence of environmental factors and charismatic leadership's "dark side," i.e., the leader's control over followers and ability to manipulate stakeholder demands and decouple organizational practices. Further, this paper answers the call from researchers to look at charismatic leadership from a systems perspective (Yukl, 1999), as...