Ethical Leadership Enhances Willingness To Report Though Mediating Effects

Literature Review

Ethical Leadership and Fairness and Willingness To Report

In terms of fairness, ethical leaders are believed to weigh the well-being of employees alongside the impact of their decision-making on the moral scale (Hassan et al., 2014). Ethical misconduct is proposed to have a negative impact on employees because of the distorted image of ethical leaders’ identities and antithetical values to what ethical leaders should hold. Additionally, ethics also acts as a compass that constructs the rule of fairness in one organization and provides guidance for rightful behaviors in organizational activities (Pedersen et al., 2017). Leaders’ actions of prioritizing the personal interests of some specific members of the organizations and not others can detrimentally influence employees’ perception of fairness.

Ethical leaders are shown to be positively related to such public interests as social equity, justice, and fairness (Wright et al., 2016). Specifically, the role of fairness, in the study field of the public sector, is positively associated with ethics (Cecez-kecmanovic & Marjanovic, 2018), self-reported affective commitment (Hassan et al., 2014) and public hiring (Pedersen et al., 2017). Nevertheless, fairness has yet to be examined in enhancing willingness to import that will be covered for the first time in this study. The underlying reason is attributable to leaders’ efforts to increase the level of ethics by suppressing special prioritization of personal benefits which implicitly reinforce public servants’ courage to convey their thoughts on the issues. In order to maintain a fair working environment, such violation of fairness is unacceptable and should be eliminated by reporting. Moreover, fairness implies no invisible power to prevent employee willingness to protect the rights, which, as a result, enhance their inclination to report ethical issues in the workplace. Therefore, we suggest the following hypotheses:

H5: Ethical leadership has a positive influence on fairness.

H6: Fairness has a positive influence on the willingness to report.

Figure 1 illustrates the research model with hypothesis development.

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Measures

Respondents are requested to evaluate the questionnaire on the 5-point Likert-scale ranging from strongly disagree to strongly disagree. First, the 8-item scale of ethical leadership is adopted from Wright et al. (2016). Second, affective commitment is evaluated by 5 measurement items from the previous studies of Wright et al. (2016) and Caillier (2017). Third, PSM is evaluated with three original items from Wright et al. (2016) and Pedersen et al. ( 2017) reflecting internal incentives. We added three self-developed items which concern job promotion as a potential external motivator. Forth, the 4-item measurement scale of Wright et al. (2016) casts light on the extent of fairness in terms of the decision-making process with an additional item “uphold ethical and moral standards”. Finally, respondents are asked to rate their willingness to report issues on a 3-item measurement scale. The initial scale consists of one item concerning “ethical problems.” After the group discussion with experts, two emblematic issues of the Vietnamese public sector “dubious process” and “personal conflicts” are added to finalize the questionnaire.

Data collection

There is a total of 320 surveyed public servants in the area of Ho Chi Minh City, Vietnam. They were asked to complete 2 parts of the questionnaire: (1) demographic information and (2) 27 questions representing five key factors in the theoretical model. In addition, an approach of Brislin, Lonner, & Thorndike (1973) called back-translation was applied during the translation process to minimize the differences in meanings between the two Vietnamese and English versions of the questionnaire.

Finally, 300 collected samples were valid for further analysis which represents an effective observation and meets the required sample size. Specifically, male and female respondents accounted for 39.4% and 60.6% respectively. The majority of the surveyed respondents belong to the working age group (26-45 years old) (84.6%) and earned bachelor’s degree (86.6%). Importantly, 64.4% claimed to have been working in the public sector for 1-10 years, while the remaining 35.6% represented experts in the field with 10-30 years of experience, which confirmed the validity of the data.

Contribution to the literature

This study is conducted for the purpose of investigating potential determinants of employee willingness to report issues in public organizations. Ethical leadership is shown to significantly enhance employee PSM (Wright et al., 2016) and encourage employees to report misconduct (Brown et al., 2005; Hassan et al., 2014). The findings also shed light on the significant role of affective commitment as consequent of PSM and antecedent of willingness to report. The results draw us to a promising future route of studying the significant role of affective commitment in mediating positive outcomes in the study field of the public sector.

In line with the study of (Pedersen et al., 2017), ethical leadership plays an important role in stimulating fairness in public organizations. Previous studies looked into employee willingness to report under the control of procedural fairness (Hassan et al., 2014; Wright et al., 2016). Accordingly, we continue to investigate fairness as an antecedent of reporting behaviour and the result confirmed its significance. The result is attributable to the perception of fairness which showed a high appreciation of equitable benefit distribution among the society. The important stimulating role of fairness can also be reasoned by the distortion of the rule of fairness when ethical norms are violated, for instance, in the case of unethical prioritization of individuals over public benefits. Hence, with the perceptions of fairness in mind, employees are more likely to report unethical conduct to maintain a fair working environment. The findings also extend the existing literature with the mediating role of fairness that enhances the impact of ethical leadership on willingness to report. We warrant for future study of fairness as a mediator in a different context in the public sector.

Implications

This study sheds light on the important determinants of employee willingness to report ethical issues in the public sector. Specifically, ethical leadership is statistically supported to have the strongest impact on the willingness to report. In addition, ethical leadership is the significant antecedent of both fairness and PSM which stimulates public servants to report directly and indirectly though the mediating role of affective commitment. Human resource managers in the public sector, therefore, should put more emphasis on ethical leadership practices that advocate employees voicing their report of the misconducts. It is suggested to list strong ethical convictions as one requisite characteristic during the recruitment process (Mayer et al., 2009). Ethics training and programs to develop ethical leadership should be organized regularly in order for each leader to design, manage, and improvise their practices to match with the current situation of their organizations. Moreover, it is highly advisable that the ethical principles be clarified because of their vital role as a compass for the guidance of rightful behaviors in the organizations. Ethical leaders, as a role model, should actively incorporate and promote such principles in their daily acts to spur their subordinates to follow. Besides, daily interpersonal conversations about ethical issues may be effective in promoting ethics, sending a signal that leaders are willing to listen and discuss employees’ concerns about the problems.

This study aims to study the impact of ethical leadership on employee willingness to report issues and the underlying mechanisms. In line with previous studies, ethical leadership is found to be the most influential in enhancing the reporting behavior of unethical conduct compared to other factors in the study. Ethical leadership is evidenced to have a strong impact on fairness and PSM, both of which are significant direct and indirect determinants of ethical behaviors (specifically, willingness to report misconduct). Considering the primary importance of ethical leadership in the context of the Vietnamese public sector, human resource managers should put be more attentive to leadership practices to raise the collective concerns, promotion, and encouragement of ethical behaviors. Moreover, the results warrant a promising path of investigating the mediating role of affective commitment and fairness in employees’ engagement in ethics-related discussions. Fairness, as a newly discovered antecedent of willingness to report, also needs further emphasis in this study field. Eventually, in regard to ethical leadership as a key factor in the framework, feasible practices are recommended for HR managers to establish an ethical and fair working climate where employees can freely raise their voice on the ethical concerns in the public organizations.