The Limits of Contemporary Leadership Theory: Boundary Conditions of Authority, Accountability, and Coordination under Institutional Constraint

Abstract

This paper examines the limits of contemporary leadership theory by identifying the boundary conditions under which its core assumptions (legitimacy, formal accountability, contract enforceability, transparency, and institutional stability) break down. While these assumptions shape current leadership frameworks, they are often unexamined in extreme contexts. Using organised crime as a case study, we demonstrate how these assumptions break down and explore alternative mechanisms that enable leadership to persist in challenging environments: authority without legitimacy, accountability outside formal structures, coordination without contracts, opacity instead of transparency, and adaptation amid instability. We introduce a boundary-condition framework that outlines how leadership mechanisms are reconfigured when conventional institutional assumptions fail, and we develop six propositions, including one that explains accountability challenges in AI-enabled organisations. We introduce a boundary-condition framework that outlines how leadership mechanisms are reconfigured when conventional institutional assumptions fail, and we develop six propositions, including one that explains accountability challenges in AI-enabled organisations. This study contributes to leadership theory by identifying its boundary conditions, proposing a framework for leadership under institutional constraints, and extending it to explain accountability challenges in AI-enabled organisations.