Effects of ethical leadership and formal control systems on employee opportunistic behavior in China

Changsuk Ko · Mark H. Haney · Gukseong Lee

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Ethics in Business and Education Job Satisfaction and Organizational Behavior Accounting and Organizational Management

Abstract

Purpose The purpose of this paper is to explore how ethical leadership and formal control systems influence employee opportunistic behavior. Design/methodology/approach Using survey data collected from Chinese employees (N=430), the authors conducted regression analysis to test hypothesized relationships between ethical leadership and formal control systems and employee opportunistic behavior. Both direct effects and an interaction effect were tested. Findings The authors found that both ethical leadership and formal control systems individually play significant roles in reducing employee opportunistic behavior. In addition, the results indicate that ethical leadership and formal control systems function as complements to jointly constrain employee opportunistic behaviors. Originality/value This study contributes to an understanding of the relationship between supervisors and followers in China by demonstrating the effects of ethical leadership and formal control systems on employee opportunistic behaviors, including an interesting interaction effect.

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References

2003Common method biases in behavioral research: A critical review of the literature and recommended remedies.1986Self-Reports in Organizational Research: Problems and Prospects 1979Transaction-Cost Economics: The Governance of Contractual Relations 1996Production, Information Costs and Economic Organization 1975Markets and Hierarchies 2001Justice at the millennium: A meta-analytic review of 25 years of organizational justice research.2005Ethical leadership: A social learning perspective for construct development and testing 2002Do formal contracts and relational governance function as substitutes or complements?

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2022Ethical leadership, management control systems and circular economy in SMEs in an emerging economy, the UAE 2022The mediating role of organizational identification between corporate social responsibility dimensions and employee opportunistic behavior: Evidence from symmetric and asymmetric approach triangulation

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