Linking Ethical Leadership with Firm Performance: A Multi-dimensional Perspective

Despite the importance of ethical leadership, the impacts of its different facets on firm-level performance are unclear. Drawing on the resource-based view of the firm and the group engagement model, we propose that ethical leadership consisting of leader humane orientation, leader responsibility an...

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Bibliographic Details
Authors: Wang, Dan (Author) ; Feng, Taiwen (Author) ; Lawton, Alan (Author)
Format: Electronic Article
Language:English
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Published: Springer Science + Business Media B. V 2017
In: Journal of business ethics
Year: 2017, Volume: 145, Issue: 1, Pages: 95-109
Further subjects:B Leader humane orientation
B Ethical Leadership
B Leader moderation orientation
B Leader justice orientation
B Leader responsibility and sustainability orientation
B Firm Performance
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Summary:Despite the importance of ethical leadership, the impacts of its different facets on firm-level performance are unclear. Drawing on the resource-based view of the firm and the group engagement model, we propose that ethical leadership consisting of leader humane orientation, leader responsibility and sustainability orientation and leader moderation orientation are beneficial to firm performance, and leader justice orientation plays moderating roles. We empirically tested this theoretical framework employing multi-source survey data collected from 264 Chinese firms. The findings reveal that both leader humane orientation and leader responsibility and sustainability orientation have positive influences on both firm financial and social performance, while leader moderation orientation only has positive influence on firm financial performance. In addition, leader justice orientation positively moderates the relationship between leader humane orientation and leader responsibility and sustainability orientation and financial performance as well as the relationship between leader moderation orientation and social performance. These findings provide theoretical and practical implications for understanding how different facets of ethical leadership jointly function to influence firm performance.
ISSN:1573-0697
Contains:Enthalten in: Journal of business ethics
Persistent identifiers:DOI: 10.1007/s10551-015-2905-9