Abstract
Leadership styles vary as per the context and environment in which the organizations exist. Today's environment for organizations is not the same as it was two decades back. Globalization, ICT convergence, digitalization, multigenerational workforce, and the recent pandemic have completely changed the environment in which organizations operate and exist. To meet this new changing time, there are challenges that leaders face and hence new styles of leadership are merging which will ensure that governance does not take the back seat but is in line with the changing dynamics and expectations. Adopting a qualitative approach, the aim of this chapter is to deliberate on contemporary leadership styles and discuss the challenges therein for better governance.
TopIntroduction
Tone-at-the-top is established by management and the Board of Directors and is critical for creating and maintaining a corporate governance framework (Andreou, Antoniou, Horton, & Louca, (2016). Corporate governance is the basis for the company’s internal control environment and for maintaining effective business processes (Andreou et al., 2016). A robust internal control environment with effective business processes is crucial because it aids management in protecting shareholder welfare (Andreou et al., 2016). Management establishes internal controls and operating procedures that protect company assets and minimize the risk of fraud or abuse (Gao & Zhang, 2019). As evidenced by a robust internal control environment, corporate governance establishes acceptable employee behavior and allows an organization to have consistent process activities. To meet this new changing time there are challenges that leaders face and hence new styles of leadership are merging which will ensure that governance does not take the back seat but is in line with the changing dynamics and expectations. Adopting a qualitative approach the aim of this chapter is to deliberate contemporary leadership styles and discuss the challenges for better governance. The content of this chapter includes a discussion of leadership styles and the challenges for governance. In the process, agency theory, the internal audit function, and the accounting and financial reporting processes as operating aspects in governance and significance of the Board of Directors as they are in leadership role, are also looked into. The results of this study expand the understanding of the leadership styles and the role from the Board of Directors plays in governance and specifically the internal controls governing the accounting and financial reporting processes.
Key Terms in this Chapter
Individual Competence: Refers to the capacity of individuals/employees to act in a wide variety of situations. It’s their education, skills, experience, energy and their attitudes that will make or break the relationships with the customers and the products or services that are provided.
Business: Pertains broadly to commercial, financial, and industrial activities.
Management: Any act by an individual member on the behalf of a group, with the intent to get the group to better meet its goals. It includes acts or activities or the process of looking after and making decisions about something.
Motivation: The act or an instance of motivating, arousing desire to do, creating interest or drive by incentive or inducement. It is also a psychological that arouses, sustains, and regulates human behavior.
Policy: Refers to guidelines as issued by the governance.
Leader: Head, superior, a person who rules, guides, motivates, encourages, stimulates, and inspires others.
Stakeholder: A person with an interest or concern in something, especially in an organization or institution. A stakeholder is a member of a type of organization or system in which a member or participant seen as having an interest in its success.
Strategies: Method chosen and plans made to bring about a desired future, achievement of goals or solutions to a problem. Strategies are a result of choices made. It is that set of managerial decisions and actions that determine the long-term performance of a business enterprise.
Core Competences: Knowledge based technical and human abilities and skills.
Decision-Making: A rational and logical process of choosing the best alternative or course of action among the available options.
Challenges: Something that by its nature or character serves as a call to make special effort, a demand to explain, justify, or difficulty in a undertaking that is stimulating to one engaged in it.