A model for the impact of ethical leadership on the effectiveness of the audit team based on McGrath's systemic framework

پژوهش نامه مدیریت تحول

Article 2, Volume 16, Spring&Summer2024, July 2024, Pages 31-65   

Document Type: Original Article

DOI: 10.22067/tmj.2024.82145.1425

Authors

Reza Zamani¹; Mahmoud Lari dashtbayaz^{* 2}; Reza Hesarzadeh²

¹Ph.D. in Accounting, Faculty of Economics and Administrative Sciences, Ferdowsi University of Mashhad, Mashhad, Iran

²Associate Professor of Accounting, Faculty of Economics and Administrative Sciences, Ferdowsi University of Mashhad, Mashhad, Iran

Abstract

 

INTRODUCTION

In a complex and constantly changing environment, organizations encounter numerous risks, challenges, and obstacles that threaten their performance and sustainability. In this regard, addressing complex problems requires the collective development of creative solutions and the establishment of teamwork relationships. Therefore, organizations adopt team-based plans to maximize the value of their human capital, so that teams become the basic building blocks of organizational leadership structure design. Identifying and investigating the determinants of team effectiveness is of great importance. Considering today's competitive and fluid environment, audit institutions should pay more attention to the effectiveness of their work teams to gain a sustainable competitive advantage. The current research aims to model the impact of ethical leadership on the effectiveness of the audit team based on McGrath's systemic framework (input-process-output).
 
2- THEORETICAL FRAMEWORK
Previous research indicates a positive relationship between ethical leadership and team intra-role performance. Ethical leadership determines the effectiveness of the senior management team and positively affects the subordinates' optimism toward the organization's future. Ethical leadership can enhance team performance directly through leader-member exchange. Additionally, ethical leaders maintain team efficacy and social cohesion when their team is not performing well. According to the above, we expect managers and supervisors to improve the audit team's performance by exercising ethical leadership.
 
3- METHODOLOGY
This is practical research in terms of purpose, and concerning the method, it is a descriptive survey. Data were gathered in two years (2021-2022) using questionnaires and interviews. To achieve the research's main goal, the needed data was collected from 189 employees of the Certified Public Accountants Society of Iran. The obtained data was analyzed using SPSS and SmartPLS software.
 
4- RESULTS & DISCUSSION
The research results showed that managers and supervisors, who have the interests of the employees in mind, make fair and balanced decisions. Creating a pattern for ethically doing work can increase commitment and cohesion among team members. Strengthening and increasing coordination and reducing conflict between members lead to an improvement in the performance and efficiency of the audit team. In short, ethical leadership improves the cohesion between the audit team members, thereby improving its performance and efficiency. On the other hand, in the input-process-output framework, process variables including cohesion, conflict, and coordination, whose relationships with team effectiveness were previously explained, can mediate input factors (ethical leadership) in team results.
 
5- CONCLUSIONS & SUGGESTIONS
According to the results of the research models test, which indicated the effect of manager-supervisor ethical leadership on team interactions, including team members' cohesion, involvement, and coordination, and ultimately team performance and efficiency, ethical leaders can bring many benefits, including coordination between members, reducing emotional conflict, reducing conflict regarding the allocation of resources and responsibilities, increasing the sense of collective commitment, and finally, improving team performance and efficiency. Therefore, it is suggested that managers and supervisors use ethical leadership mechanisms to establish effective communication with team members and treat them fairly. Audit institutions should include this criterion in their employment policies as a basis for accepting or continuing to work with audit managers and supervisors. Since some data was collected electronically, it should be noted that the authors did not directly monitor the respondents and the correctness of their responses. Accordingly, regarding the research limitations, response bias is likely to happen in self-reporting measures.

Keywords

Ethical Leadership; Team Effectiveness; Team Interactions

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