Impact of Ethical Leadership on Organizational Performance and Employee Engagement: A Comprehensive Review

Abstract

Ethical leadership is currently one of the main organizational performance drivers, having a great impact on performance outcomes and levels of employee engagement. This systematic review synthesizes evidence to illuminate the complex dynamics linking ethical leadership behavior with organizational effectiveness. Within a review of more recent quantitative studies and conceptual frameworks, we describe how employee behavior is shaped by ethical leaders, builds trust, and facilitates high-performance cultures. The meta-review integrates the evidence from varied organizational settings, and it is concluded that ethical leadership is always associated with greater employee engagement, organizational citizenship behavior, and performance outcomes over the long run. However, the mechanisms through which the latter are generated are highly complex and situation-specific.