The Importance of Ethical Leadership in Employees’ Value Congruence and Turnover

Abstract

This study investigates the relationship between leadership, value congruence, and employees’ intention to leave in China’s hospitality industry. We test the moderating effect of cultural values on the relationships between these factors using data gathered from employees at ten branches of a major restaurant chain in South China. Our results show (1) a positive relationship between ethical leadership and leader–follower value congruence, (2) a significant moderating effect of collectivism on the relationship between ethical leadership and leader–follower value congruence, (3) a negative relationship between leader–follower value congruence and employees’ intention to leave, and (4) a significant mediating effect of value congruence on the relationship between ethical leadership and employees’ intention to leave. Although these findings apply only to the restaurant industry, it is clear that ethical behavior by group leaders builds value congruence and discourages employee turnover.