Exploring the influence of ethical leadership and culture on employee job satisfaction: the moderating effects of age, gender, tenure, and organizational age

Employee job satisfaction is crucial for retaining good employees and sustaining the organization. Leaders’ ethical values and how these ethical values get translated into creating an ethical organizational culture are crucial factors in employee job satisfaction. In this study, we administered a survey questionnaire to understand how employee job satisfaction is related to the presence of ethical leadership. We also explored the mediating role of ethical culture and the moderating impact of age, gender, tenure, and age of the organization. We used leader-member exchange theory, and adapted frameworks primarily developed in a Western context and found that they are significant in the Indian context. We observed that ethical culture mediates the relationship between ethical leadership and job satisfaction. The analysis also revealed that Millennials and Gen-Z prefer organizations with an ethical culture. The same is true for new entrants against employees who have spent more extended periods in the same organization. We collected 210 samples from India’s micro, small, and medium-sized enterprises (MSMEs). There were 152 male respondents, 58 female respondents, and 145 respondents in the age group of 20–30 and 65 in the range of 30–50. We used SPSS Amos to perform structural equation modeling. The results hold significant implications for managers. The research calls upon managers to create an ethical culture with clearly articulated rules. This culture should encourage dissent and punish deviations. MSME companies must move away from the leader-centric approach to conscientiously creating an ethical culture.