Integrating Ethical Leadership into Performance Appraisal Systems: A Review of ESG Sustainability Practices

DOI

10.2991/978-2-38476-358-0_16How to use a DOI?

Keywords

Ethical Leadership; Environmental; Sustainability and Governance; Performance Appraisal; State Agencies

Abstract

Past research has extensively documented the negative impacts of political appointments on organizational leadership and the significance of ethical leadership in enhancing organizational performance. However, there remains a gap in studies focusing on ethical leadership within the contexts of Environmental, Social, and Governance (ESG) criteria and performance appraisal systems for organizational leaders, particularly in state-owned agencies (SOAs). This paper aims to address this gap by reviewing recent literature on the relationship between ethical leadership, performance appraisal, and ESG factors, and relating their implications for organizational performance in Sabah SOAs. The review examines existing theories on performance appraisal and ethical leadership, identifies deficiencies in current appraisal systems, and assesses how ethical leadership influences ESG sustainability in large organizations. Findings indicate a lack of effective performance appraisal systems for leaders in Malaysia and limited generalizability of previous research due to variations in participant demographics, geographic locations, and cultural contexts. The study also highlights how factors such as human rights, good governance, labor relations, and corporate policies contribute to investment impacts through environmental effects. The review emphasizes the importance of transparency and integrity in organizations to ensure that politically appointed leaders are appropriately appraised and developed. This is crucial for sustaining ESG initiatives in Sabah state agencies. The paper advocates for further research to enhance performance appraisal systems and better understand the role of ethical leadership in promoting ESG sustainability in SOAs.

Copyright

© 2025 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - Alwizan Mohd Ron
AU  - Ahmad Shahrul Nizam Isha
PY  - 2025
DA  - 2025/01/31
TI  - Integrating Ethical Leadership into Performance Appraisal Systems: A Review of ESG Sustainability Practices
BT  - Proceedings of the International Conference on Environmental, Social, and Governance (ICESG 2024)
PB  - Atlantis Press
SP  - 202
EP  - 210
SN  - 2352-5398
UR  - https://doi.org/10.2991/978-2-38476-358-0_16
DO  - 10.2991/978-2-38476-358-0_16
ID  - Ron2025
ER  -