Background Ethical leadership involves guiding and influencing others through actions rooted in honesty, integrity, fairness, and respect. It was crucial for building trust, fostering a positive organizational culture, motivating employees, managing risks, and ensuring long-term, sustainable success. Objective The study of ethical leadership became central to understanding how leadership affected organizations. This study proposed that organizational justice was a psychological mechanism through which ethical leadership shaped individual ethical behavior. This study used a moderated mediation model, showing that a leader’s moral identity affects how ethical leadership influences employees’ ethical behavior through the concept of organizational justice. Methods Data were collected from 360 subordinate-supervisor pairs within a prominent Saudi public organization. Results The research revealed two key findings after analyzing data from 360 supervisor-subordinate pairings in different Saudi organizations. Firstly, ethical leadership positively impacted employee ethical behavior, and organizational justice mediated this relationship. Secondly, the effect of ethical leadership on employees’ ethical behavior was high when leaders showed higher moral identity. Conclusions In conclusion, the study underscored the pivotal role of ethical leadership in shaping employees’ ethical behavior, mediated by organizational justice. It highlighted that leaders with a strong moral identity enhanced this effect, demonstrating the importance of fostering ethical leadership and justice within organizations to promote ethical conduct among employees. These insights offered valuable theoretical and practical implications for organizational development.
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