The Influence of Perceived Ethical Culture and Ethical Leadership on Job and Organizational Engagement

Ethics in leadership continues to be of interest in psychology and business literatures; however, there is relatively limited research investigating the interplay between ethical leadership, ethical culture, and employee engagement. Specifically, this study explored the mediating effects of perceived managerial ethical leadership behavior (PELB) between perceived organizational ethical culture (POEC), and employee job engagement (JE) and organizational engagement (OE). It was hypothesized that both POEC and PELB would be positively related to JE and OE, and that PELB would mediate the relationships between POEC and JE and POEC and OE.;Data was collected via online surveys. To mitigate common method bias, the exogenous and endogenous measures were temporally separated. A total of 239 working adults participated in this study (63% female and 37% male, with an average age of 34.24 years [SD = 10.56]). In terms of ethnicity, the sample consisted of 82% Caucasian/White, 8% Asian/Pacific Islander, 6% Other/Multi-Racial, 3% Hispanic/Latino, and .8% African American/Black.;Structural equation modeling was used to examine overall model fit and phantom modeling was used to assess the mediation effects. Results indicated significant total effects between POEC and JE (beta = .23) and between POEC and OE (beta = .40). Findings also demonstrated a significant indirect effect of PELB between POEC and JE (beta = .20, p = .002) and between POEC and OE (beta = .18, p = .001). Additionally, the unique or direct effect of POEC on JE, when controlling for PELB, was smaller and non-significant (beta = .03, p = .708); however, the direct effect of POEC on OE, when controlling for PELB was significant (beta = .22, p = .007). The mediated model indicated good fit to the data, (x2 = 13.65, df = 5, p = .02; CFI = .97; RMSEA = .08).;Findings suggest that when employees perceive their organizational culture and manager's behavior to be ethical, they are more likely to be engaged with their organization not just their work. Architecting an environment that promotes and reinforces ethical conduct may help organizations harness employee capability, by fostering conditions for more holistic work engagement and enhancing the employee experience.