On Using Sequential Equation Modelling to Test Leadership Types in the Certified Public Accounting Profession

• In Event: Pension Plans, Derivatives, & Clawback Provisions

Abstract

Few studies in the literature have examined the effect of different leadership styles on Certified Public Accountants (CPA’s). Authentic leadership is a leadership style that fosters positive psychological capacities and a positive ethical climate (Walumbwa, Avolio, Gardner, Wernsing & Peterson, 2008). We examined whether authentic leadership as demonstrated by CPA managers is positively related to the level of commitment by subordinates and negatively related to their role-ambiguity and intentions to leave. We also compared authentic leadership to a Laissez-faire leadership style, and examined differences between CPA firms and other places where CPAs are employed. We also were interested in differences which depend upon the career stage of the CPA. The hypotheses were tested on a sample of 512 CPAs in Israel using Sequential Equation Modelling (SEM). The results indicate that authentic leadership predicts desirable subordinate job attitudes, and therefore could enhance their motivation, while laissez-faire leadership has the opposite effect. This could have a significant impact on how we lead in the CPA profession.

Authors

• Elad Kalay, Ariel University, Israel

• Yael Brender-Ilan, Ariel University

• Jeffrey Kantor, Ariel University, Israel