Charismatic leadership perspectives emphasise the kind of leader–follower social relationship summarised above and are the first of the wholly new leadership approaches considered. House’s version of this approach defines charismatic leaders as those who by force of their personal abilities are capable of having a profound effect on followers. The work of Conger and Kanungo suggests that if leaders use behaviours such as vision and articulation, environmental sensitivity and unconventional behaviour, rather than maintaining the status quo, followers will attribute charismatic leadership to them. Yukl draws a distinction between charismatic and transformational leadership (see below) by suggesting that transformational leadership requires leaders to empower others and make them partners in a change process, whereas charismatic leadership requires followers to place their trust in the leader’s special expertise to achieve radical change.

Notwithstanding Yukl’s distinction, transformational leadership is typically seen as a broader approach than charismatic leadership. Bass and associates’ transformational perspective is a particularly well-known theory that includes charisma as one of its dimensions. It separates vision-oriented transformational leadership from day-to-day transactional leadership and argues that the two work in combination. Transactional leadership is typically seen as based on contingent rewards, management by exception (active and passive), and laissez-faire behaviour. Transformational leadership is dependent on the four ‘I’s’ of individualised consideration, intellectual stimulation, inspirational motivation and idealised influence. Transformational and charismatic leadership, and the new leadership in general, are important because of their facilitation of change in our increasingly fast-moving world.