Do as I say and do as I do? The mediating role of psychological contract fulfillment in the relationship between ethical leadership and employee extra-role performance

DOIhttps://doi.org/10.1108/PR-12-2016-0325
Date04 February 2019
Pages98-117
Published date04 February 2019
AuthorIfzal Ahmad,Magda B.L. Donia,Asadullah Khan,Muhammad Waris
Subject MatterHR & organizational behaviour,Global HRM
Do as I say and do as I do? The
mediating role of psychological
contract fulfillment in the
relationship between ethical
leadership and employee
extra-role performance
Ifzal Ahmad
School of Business and Management, Karakoram International University,
Gilgit, Pakistan
Magda B.L. Donia
Telfer School of Management, University of Ottawa, Ottawa, Canada, and
Asadullah Khan and Muhammad Waris
Faculty of Industrial Management, University of Malaysia Pahang,
Pahang, Malaysia
Abstract
Purpose The purpose of this paper is to investigate the impact of ethical leadership on two important
employee extra-role behaviors; organizational citizenship behaviors (OCBs) and creative performance (CP).
Drawing on social exchange and organizational support theories, psychological contract fulfillment (PCF)
was proposed as the mediating mechanism explaining this relationship.
Design/methodology/approach Data were collected via questionnaire from 248 employee-supervisor/
colleague dyads employed in a large fast-moving consumer goods multinational company in Pakistan.
The hypotheses were tested using structural equation modeling.
Findings Supervisorsethical leadership style (ELS) was positively related to employeesOCBs and CP.The
predicted mediating role of PCF in the relationship between ELS and extra-role behaviors was also supported.
Research limitations/implications While it benefittedfrom dyadic data, a significant limitation of this
studyis the cross-sectional natureof the data. A noteworthyimplication of the findingsis the important role that
supervisorsELS plays in employeesbehaviors within the organization. Furthermore, it appears that ethical
leadership is a significant factor in employeesevaluations of PCF and their ensuingbehavioral responses.
Originality/value This study contributes to addressing the inconsistent findings in prior research on
ethical leadership. An additional novel contribution is that it identifies PCF as an underlying mechanism
linking ethical leadership and employeesextra-role behaviors.
Keywords Quantitative, Creativity, Psychological contract fulfilment,
Organizational citizenship behaviour (OCB), Ethical leadership style
Paper type Research paper
Introduction
In what is increasingly referred to as the post-truthera in which basic ethical conduct
appears unnecessary for leadership success (Egan, 2016), the notion of ethical leadership
may seem to some as outdated and even a nuisance. Such societal reality stands in contrast
to research in fields such as organizational behavior and industrial and organizational
psychology that view ethical leadership as increasingly relevant in light of recent large scale
corporate scandals such as VolkswagensDieselgate(Smith, 2016). Indeed, researchers
agree on the importance of ethics in the workplace and of ethical leadership in particular
(e.g. Ciulla 1995; Javed et al., 2016; Mo and Shi, 2015).
Personnel Review
Vol. 48 No. 1, 2019
pp. 98-117
© Emerald PublishingLimited
0048-3486
DOI 10.1108/PR-12-2016-0325
Received 19 December 2016
Revised 5 June 2017
2 October 2017
3 December 2017
6 February 2018
26 March 2018
Accepted 4 June 2018
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/0048-3486.htm
98
PR
48,1
Defined as the demonstration of normatively appropriate conduct through personal actions
and interpersonal relationships and the promotion of such conduct to subordinates through
two-way communication, reinforcement, and decision-making(Brown et al., 2005, p. 120),
copious research has established the positive impact of ethical leadership on subordinates
attitudesand behaviors.For example, thereis much evidence ofthe impact of ethicalleadership
on employeeswell-being (e.g. Chughtai et al., 2015), performance (e.g. Walumbwa et al., 2011),
organizational citizenship behaviors (OCBs); (e.g. Mo and Shi, 2015; Mayer et al., 2012),
academic citizenship behavior (Arain et al., 2016), safety performance (Khan et al.,2018),job
satisfaction (e.g. Yozgar and Mesekiran, 2016), creativity (e.g. Chugh tai, 2014; Feng et al., 2016)
and innovative work behaviors (Yindong and Xinxin, 2013).
Importantly, the relationship between ethical leadership and employeesinvolvement in
extra-role behaviors also provides encouraging evidence of the importance of this leadership
style on valuable discretionary employee behaviors (Boehm and Dwertmann, 2015).
However, there are not only limited studies focusing on discretionary behavioral outcomes
such as OCBs and creative performance (CP) but the existing studies also have some notable
inconsistencies in their findings (Lu, 2014). For example, Arain et al. (2016) found both direct
and indirect effects of ethical leadership on studentsacademic citizenship behavior, Mayer
et al. (2012) found a direct positive relationship between ethical leadership style (ELS) and
OCB, while Mo and Shi (2015) found only an indirect relationship between ELS and OCB
mediated by organizational concern. On the other hand, Feng et al. (2016) identified a
curvilinear relationship between ELS and OCB. Similarly, Javed et al. (2016) found both
direct and indirect effects of ELS on creativity through empowerment, whereas, Chughtai
(2014) identified only an indirect effect of ELS on creativity, mediated by leader-member
exchange and psychological empowerment.
These differential findingssuggest the importance of uncoveringand better understanding
of potentialmechanisms by which ethicalleadership impacts employeesOCBs and CP. Brown
and Mitchell (2010) also stressed on conducting more research to better understand the
implications of ethical leadership. Among the most prominent studies exploring mediating
paths are those considering the roles of moral identity (Arain et al., 2016; Bavik et al., 2017),
employee controlled motivation (Bavik et al., 2017), safety culture and safety consciousness
(Khan et al., 2018), trust(Xu et al., 2016), leader-memberexchange (Chughtai, 2014;Walumbwa
et al., 2011), procedural justice and organizational c oncern (Mo and Shi, 2015), psychological
empowerment ( Javed et al., 2016), knowledge sharing and self-e fficacy (Ma et al., 2013),
employee voiceand psychological ownership(Avey et al., 2012; Chen and Hou, 2016), intrinsic
motivation (Feng et al., 2016) and work-related s tress (Elci et al., 2012).
Defined as thepromissory understandingsand beliefs of an employee aboutthe chances of
fulfillmentof the pledges made by their organization (Rousseau, 1995), psychological contract
fulfillment (PCF) has been identified as a strong predictor of important outcomes such as
turnover intentions (Collins, 2010), commitment (Fontinha et al., 2013), innovative work
behavior (Chang et al., 2013), OCBs (Mo and Shi, 2015; Turnley et al., 2003), job performance
(Conway and Coyle-Shapiro, 2012; Rodwell et al., 2015) and perceived organizational support
(Chaudhry and Tekleab, 2013). In line with Mo andShis (20 15, p. 1) argument that little was
known regarding the underlying mechanism through which ethical leadership enhances
employeesOCB; we contend that the value of exploring the role of PCF toward explaining
the manner through which ethical leadershipimpact employeesbehavioral outcomes is high.
Extant studiesalso emphasized on studying othermediating variables (such asPCF ) because
of the increasingattention to research on ethicalleadership (Hoch et al., 2016).Studies suggest
that the outcomes of PCF are stronger in strength with fulfillment of commitments than the
isolated commitments itself (Lambert et al.,2003). Therefore, it is expectedthat mediating role
of PCF between ethicalleadership and employeesextra-role behaviors,such as creativity and
OCB, will unfold its vast potential implications.
99
The mediating
role of
psychological
contract

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