Ethical leadership in sustainable organizations: The moderating role of general self-efficacy and the mediating role of organizational trust

Abstract Contemporary sustainable organizations are facing the dilemma of enhancing the intellectual and emotional commitment and engagement of their employees. This study aims to examine the underlying mechanism in the relationship between ethical leadership and employee engagement. Drawing on the social exchange theory, this study investigates the mediating role of organizational trust and moderating effect of general self-efficacy on this relationship. Data were collected through three-wave time-lagged study design from 212 employees working in public and private organizations. Findings of this study demonstrated that ethical leadership influences organizational trust of employees, which in turn improves their engagement at the workplace. In addition, the effect of ethical leadership on employee engagement was found to be stronger for those individuals with low rather than high general self-efficacy. The theoretical and managerial implications are also discussed in light of the findings.