Purpose
The purpose of this paper is to examine the effect of ethical leadership on employee performance, with the employee engagement and organizational citizenship behavior (OCB) as mediating variables.
Design/methodology/approach
The design of this study was to ascertain the predictive generalizations truth of the theory. The population in this study was all employees of non-star hotels in Sarbagita area of Bali.
Findings
First, ethical leadership does not have a significant effect on employee performance, where the increase in leadership value is not able to provide a significant improvement in the performance of non-star hotel employees in the Sarbagita area of Bali. Second, employee engagement is able to mediate ethical leadership in improving employee performance. Third, the OCB will be able to play a role in mediating the influence of ethical leadership on employee performance if it passes the mediating role of employee engagement first.
Originality/value
The inconsistencies of the previous study results provide evidence and opportunities for this study to review by including mediating variables on ethical leadership and employee performance relationship. The studied variable as a mediating variable is employee engagement. In addition to employee engagement, this study also included the OCB variable as a mediating variable. Several previous studies have identified the influence of ethical leadership, employee engagement and OCB in improving employee performance in separate research models, so there is still a gap for further research.
This study aims to examine the role of ethical behavior and entrepreneurial leadership in improving organizational performance. This research was conducted at the management of the Lembaga Perkreditan Desa (LPD) in Bali. Based on 2016 data, the number of LPDs in Bali was 1433 units, but 177 units were not operating, so 1256 units spread out in 9 districts/cities. Sampling is based on Slovin formula with 9% precision, so the number of LPDs sampled is 34 units. The determination of LPD samples in each district/city was carried out by stratified proportional random sampling. The research respondents were LPD administrators consisting of heads, secretaries, and treasurers in each LPD sample, so the number of respondents was 102 people. Data retrieval is done through interviews with respondents based on the prepared questionnaire. Furthermore, data processing is carried out with the SmartPLS 3.0 program. The results of the study found that
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