Ethical Leadership as a Driver of Supervisor Technical and Social Effectiveness: A Triple Helix for Cultivating Employees' Sense of Purpose

ABSTRACT A sense of purpose is generated when individuals perceive an authentic connection between their work and a broader transcendent life purpose beyond the self. Academics have shown significant positive effects of this driving force in life for employees and organizations, and thus the literature demands studies that analyze its antecedents, i.e., the potential factors that shape an individual's sense of purpose in life. Following an Aristotelian approach to virtue ethics in business, we analyze (1) whether ethical leadership enhances the technical and social effectiveness of supervisors, and (2) whether this moral asset of leaders enhances employee sense of purpose, either directly or by interacting with their technical and social effectiveness‐related dimensions. Using data from 395 employees in the Iraqi insurance and health care industry, structural equation modeling analysis revealed that, as expected, the ethical dimension of supervisors can influence employees' sense of purpose, both directly and by improving their technical and social effectiveness as leaders. Our findings thus encourage managers to practice ethical leadership to become more effective in leadership and in encouraging employees to have a sense of purpose in what they do.