A social exchange perspective in sustaining employee engagement: do benevolent leaders really matter?

The hybrid working mode, which has become prevalent post-pandemic, emphasizes a new management style for managing a geographically dispersed workforce. Switching between family and work roles requires additional attention from leaders beyond the workplace to keep the employees engaged. The essential role of leadership in remote office management has been highlighted in the banking industry. Bank managers are expected to intensify their attention to employees’ safety and well-being, as well as their physical and mental conditions, to secure seamless business processes. This study proposes that benevolent leadership, a leadership style that provides holistic care beyond the working context, elevates employee engagement via psychological empowerment as a result of the social exchange process. A cross-sectional study was conducted using a final sample of 280 banking employees in Malaysia. The findings show that psychological empowerment has an indirect mediation effect on the relationship between benevolent leadership and employee engagement. This study provides insights into the indispensable role of empowerment in facilitating benevolent leadership to enhance engagement among the hybrid banking workforce in a multicultural context. A refocus on leadership in consummating existing engagement programs and appropriate task delegation was suggested to effectively promote engagement in the banking environment.