How much influence does a leader have on Organizational culture?

Each employee of an organization is an influencer as far as the organizational culture is concerned but my opinion is that the senior the person, the greater the influence. I would like to illustrate this with a real life case scenario of an organization. Let’s call this organization “ABC Inc”. ABC is headquartered in Bangalore and is in the software services sector. It has a fantastic culture and employee engagement levels are quite high. Employees are encouraged to take time off from their work to have fun, and make office a lively place. It also has a flat hierarchy and every employee is treated as an equal irrespective of their level in the organization.
To strengthen its presence in South India, ABC decided to open a development center in Chennai. It appointed Mr. G as the location head. Mr. G has around 30 years of experience and is quite well known in the industry. He has spent most of his years in organizations which are hierarchical in nature and where there is a clear distinction between people in different grades. He is a person who likes to exercise his powers, use his privileges and enjoys being address as “Sir” by employees.
For the Chennai center staffing, many of the staff from the Bangalore office was transferred to Chennai. Freshers were recruited from different colleges in Tamil Nadu, and then were trained at the Bangalore office and then moved to the Chennai office. Mr.G also brings in a bunch of his old colleagues and these folks assume senior manager positions at the Chennai office.
After 3 months of operation, the Bangalore headquarters start getting complaints from Chennai employees that the culture there sucks. The Headquarters decides to do a secret audit and sends one HR person over to Chennai. The HR person meets with a cross section of the employees and seeks their feedback. He finds that the Chennai office has become very hierarchical and if an employee wants to meet a senior manager, he or she will have to send a request for meeting. It definitely is not following an open door policy. He also sees that the office is quite with minimal interaction between employees.
Even though there is no policy written down that specifies how the working environment should be, the leader’s likes and dislikes get into the system and that influenced the culture. A person who has the power to take decisions, and is high up in the organizational pyramid definitely is an influencer to organizational culture.