A few articles covering the influence of a company’s ethical leadership on employee retention.
Voice more and stay longer: How ethical leaders influence employee voice and exit intentions
Given the importance of voice in ethical leadership theory, authors Lam et al. analyse the relationship of ethical leadership to employee voice and the relationship of voice to exit intentions. Building on the theory of work engagement, the authors further hypothesise that cognitive engagement mediates these proposed relationships. To test these propositions, the researchers conducted a field study to relate ethical leadership of supervisors, measured at time 1, to employees’ cognitive job engagement, measured at time 2.
The analyses show that the relationship between these variables can account for supervisory ethical leadership’s association with employee voice and exit intentions. In a supplementary study using a different sample, Lam et al. find that supervisory ethical leadership is related to exit intentions through voice. The authors discuss how these findings contribute to the literature on ethical leadership, employee voice, and exit.
Lam, L., Loi, R., Chan, K., & Liu, Y. (2016). Voice More and Stay Longer: How Ethical Leaders Influence Employee Voice and Exit Intentions.
Business Ethics Quarterly, 26(3), 277-300.
When does corporate social responsibility reduce employee turnover?
This study places important boundary conditions on the generally accepted notion that CSR will reduce turnover. The primary argument is that CSR will be most effective at reducing turnover that is motivated by a preference for more meaningfulness at work. Authors Carnahan et al. find empirical support for this idea using microdata on attorneys employed by large law firms.
The authors find that firms with higher levels of CSR have moderately lower rates of turnover to startup law firms and through occupation changes, moves which are more likely to be motivated by a preference for meaningfulness than moves to non-startup law firms. Strikingly, the retention benefits of CSR are much stronger after attorneys experience mortality-related shocks that cause them to re-evaluate their jobs (i.e., for New York City-born attorneys following the 9/11 attacks).
To the authors’ surprise, firms with higher levels of CSR experience higher turnover rates to non-startup law firms. In addition to their arguments about the importance of meaningfulness, the study provides two important extensions to work examining CSR and turnover: (1) it may be useful to view the CSR-turnover relationship through a risk-management lens, and (2) investments in CSR may increase employee departures from organisations under certain conditions.
Seth Carnahan, David Kryscynski and Daniel Olson. (2016). When does corporate social responsibility reduce employee turnover? Evidence from attorneys before and after 9/11.
Academy of Management Journal, online August 16, doi: 10.5465/amj.2015.0032.
Does CSR enhance employer attractiveness for millennials?
Corporate social responsibility (CSR) has become increasingly important in labor market communication. To express organisational identity, reinforcing commitment to sustainable development and stakeholder engagement, organisations report their CSR activities. The impact of a company’s employer branding (EB) strategy depends on how information recipients interpret corporate messages. Therefore, authors Klimkiewicz and Oltra assume that job seekers may show diverse attitudes toward CSR.
The extant literature has hardly explored the interplay between CSR, EB, and job seekers’ attitudes, so the authors identify a relevant research gap to be tackled. The aim of this paper is to examine how millennial job seekers’ attitudes toward CSR influence perceived CSR-based employer attractiveness (EA).
Klimkiewicz and Oltra conducted an empirical study in Poland, collecting data from a sample of Millennials – highly sensitive toward CSR issues. The results generally confirm that individual attitudes toward CSR play a key role in understanding how job seekers perceive CSR signals and eventually impact CSR-based EA.
Klimkiewicz, K. and Oltra, V. (2017) Does CSR Enhance Employer Attractiveness? The Role of Millennial Job Seekers’ Attitudes.
Corporate Social Responsibility & Environmental Management, doi: 10.1002/csr.1419
Discovering the millennials’ personal values orientation
Values theory posits that individuals have values and they are formed by upbringing and life’s experiences and influence an individuals’ cognitive processes, decisions, and behaviour. Emerging onto the business scene is a new population group, the Millennials.
This research seeks to explore Millennials’ values from the viewpoint of their personal value orientation (PVO). Managerial PVO from the 1980s and 2010s are used as comparative populations. The Millennials’ PVO is generally consistent with managerial PVO from past research. They tend toward a Personal, rather than Social, and Competence, rather than Moral, value orientation. Yet, some subtle differences emerged.
Millennials are more self-focused and less other-focused than managers from the 1980s or 2010s. They emphasise competency skills more than today’s managers but less than the managers of the 1980s and place more worth on moral values than managers of the 1980s but less than today’s managers.
Weber, J. 2017. Discovering the Millennials’ Personal Values Orientation: A Comparison to Two Managerial Populations.
Journal of Business Ethics, 143(3), 517–529.
The interactive effect of perceived pay equity and diversity climate on turnover intentions
Stakeholder theory has received greater scholarly and practitioner attention as organisations consider the interests of various groups affected by corporate operations, including employees.
This study investigates two dimensions of psychological climate, specifically perceived pay equity and diversity climate, for one such stakeholder group: racioethnic minority professionals. Buttner and Lowe examined the main effect of U.S. professionals’ of colour pay equity perceptions, and the influence of perceived internal and external pay equity on turnover intentions. The authors also investigated the interactive effect of perceptions of pay equity and diversity climate on turnover intentions. Results indicated that pay equity perceptions were negatively associated with turnover intentions.
The findings showed that perceptions of internal pay equity influenced turnover intentions but perceptions of external equity did not. Further, perceptions of pay equity and the diversity climate interactively influenced turnover intentions. Participants who reported an unfavourable diversity climate and a low perceived pay equity were most likely to report turnover intentions. Simple slope analysis for moderate pay equity also was significant. When perceived pay equity was high, favourability of the diversity climate did not affect turnover intentions.
The findings have useful practical implications. When pay was perceived as equitable, participants appeared to pay less attention to the diversity climate. Employee pay equity perceptions may be malleable; sharing information with employees about pay levels during performance reviews may enhance perceptions of pay equity. The findings suggest that, consistent with stakeholder theory, organisations should attend to perceptions of both pay equity and diversity climate when striving to minimise the turnover intentions of professionals of colour.
Buttner, E.H. & Lowe, K.B. 2017. Addressing internal stakeholders’ concerns: The interactive effect of perceived pay equity and diversity climate on turnover intentions.
Journal of Business Ethics, 143(3), 621–633.