Authentic Leadership and Psychological Capital

Running head: AUTHENTIC LEADERSHIP AND PSYCHOLOGICAL CAPITAL
Authentic Leadership and Psychological Capital
Name of the student
Name of the University
Author note

1AUTHENTIC LEADERSHIP AND PSYCHOLOGICAL CAPITAL
Introduction
Authentic leadership refers to approach in relation to leadership that emphasizes on
building the legitimacy of the leader. It can be done with the help of maintaining of honest
relationship with the followers by building on the aspect of ethical foundation. The authentic
leaders act as positive people who helps in promoting the aspect of openness in an
organization. Leader member exchange is indicative of relationship based approach that
focusses on the aspect of two-way relationship that exists between the leaders and that of the
followers (Shamir and Eilam-Shamir 2018). Psychological capital refers to the development
state which is characterized by the elements of self-efficacy, hope along with resiliency. This
literature review discusses about the relationship that exists in between authentic leadership,
psychological capital and that of leader member exchange. This literature review also
elaborates on how to build up the psychological capital of different kinds of employees like
professionals and the administrative employees. It also discusses regarding the building of
psychological capital of blue colour and the white collar employees. It also talks about how to
build psychological capital of different generational cohort along with the people belonging
to various ethnicities. It also talks about the significance of emotions on the performance of
the employees in an organization.
Relationship in between authentic leadership, leader member exchange and the
psychological capital of employees
Authentic leadership focuses on the aspect of moral quasi-traits that is originated from
the value standards of a person. Authentic leadership equips the leaders with a kind of
thinking pertaining to their own behaviour. According to Leroy et al. (20150, authentic
leadership lays stress on the intrinsic qualities that a leader has which is more salient as
compared to exhibited behaviour of leader. The concept of authentic leadership extends

2AUTHENTIC LEADERSHIP AND PSYCHOLOGICAL CAPITAL
beyond that of authenticity of leader that helps in encompassing authentic relation with the
followers. It has been argued by Wang et al. (2014) that positive psychological capacities that
an authentic leader has helps in fostering positive behaviour in the employees of an
organization. Authentic leadership paves the path for exchange taking place in between
leader and the follower and it helps in the self-development of the employees of an
organization. Authentic leadership paves the path for that of leader-member exchange as it
looks beyond behaviour of a leader and lays more stress on the aspect of the followers of the
leader that helps in facilitating the aspect of leader-member exchange in an organization.
According to Laschinger and Fida (2014), authentic leadership springs from the self-
determination theory that lays emphasis on idea that human nature will show persistent
positive feature by exhibiting effort along with agency. Authentic leaders shows consistency
in relation to values and the beliefs which has positive consequence on the psychological
well-being of the employees of an organisation. The authentic leader displaying good values
can make the employees psychologically happy that would be reflected on their jobs. The
leader-member exchange taking place can help in building psychological capital of
employees that can lead to growth of the organization.
Building the psychological capital of employees
Building psychological capital of professionals and the administrative employees
The psychological capital of the professionals can be built in an organisation by
nurturing the element of trust within an organisation. The leader can build the psychological
capital of the professionals by the help of the aspect of relational transparency along with the
ethical perspective. It has been stated by Sendjaya et al. (2016) that the authentic leader
engaging in the process of balanced processing can instill positive behaviour in the
professionals that can augment performance of the employees in an organization. The leader

3AUTHENTIC LEADERSHIP AND PSYCHOLOGICAL CAPITAL
should be able to prove authenticity by taking recourse to the actions that can help in
developing the capacity of the professions working within the framework of an organization.
The psychological capital of the professions can be built with the help of the aspect of
dominant trust that can help in fostering positive performance of employees. The public
organisations need servants who would be dedicated towards their work. According to Hirst
et al. (2016) that the positive leader should focus on building the strength of the
administrative employees that can help in bringing about positive outcome for the employees
working in an organisation. The authentic leader should instill dimension of hope that can
help the employees in relation to their engagement in the organisation. The authentic leader
should provide hope to the administrative employees that can act as a positive factor that can
help the employees in reaching their organisational goal.
Building of emotional labour in employees
It has been found with the help of research that in the event of the service provider
being able to identify with the work role emotional labour can result into increasing well-
being of the employees in an organisation. Emotion Regulation Theory has stated that
emotional labour can give rise to burnout along with job dissatisfaction of the employees in
an organisation. Suppressing the emotions at the time of social interaction can result into
overworking of the nervous systems of the employees in an organization (Conway 2015). The
authentic leader should show the element of emotion regulation that can help them in
controlling the behaviour of the employees of an organization. It has been found with the help
of research that level of the job demand can have an impact on the stress that are experienced
by the employees of an organization. The authentic leader should have control over the aspect
of emotional displays that can help in facilitating exchange taking place in between the leader
and the employees of an organization.