The Effects of ethical leadership on innovation orientation: the mediating role of spirituality

In nowadays competitive markets, the organizations’ innovation orientation is increasingly considered as a key factor for their long-term success. organizations of having more innovative capacity may react to environmental challenges more rapidly. innovation orientation is defined as the organization's ability to develop an innovative process in line with the business model to achieve its vision, objectives, and goals. previous research indicated that the organizational context plays a vital role in developing capabilities and tendencies toward innovation. researchers believe that spirituality and ethical leadership have an important role in shaping the innovation orientation. ethical leaders make the organizational climate ethical and pleasant by entering spirituality into the organization. the relationship between ethical leadership and spirituality considering the innovation orientation has been less studied in previous research. according to the importance of innovation orientation, the present study can be beneficial for organizational planning and providing solutions to improve innovation.

THEORETICAL FRAMEWORK

According to the literature on innovation orientation, ethical leadership, and spirituality, the theoretical framework was established having four hypotheses as follows:
Hypothesis 1: ethical leadership has a positive and significant impact on innovation orientation.
Hypothesis 2: ethical leadership has a positive and significant impact on employees’ spirituality.
Hypothesis 3: employees’ spirituality has a positive and significant impact on innovation orientation.
Hypothesis 4: employees’ spirituality mediates the relationship between ethical leadership and innovation orientation.

This research was an applied study in terms of purpose and it was a descriptive-correlational study in terms of method. the data gathering instrument was a questionnaire and collected data was analyzed by structural equation modeling. the statistical population was comprised of 190 experts working in the R&D department of saipa automotive company, 120 of which were selected by conducting simple random sampling based on cochran's formula. the estimated PLS model was evaluated and confirmed in terms of reliability and convergent and divergent validity. the model’s reliability, specifically, was assessed by two indices of cronbach's alpha and composite reliability.

Research results indicated that ethical leadership positively affects innovation orientation in the R&D department of the company under study. This finding suggests that, by creating a constructive organizational culture, ethical leaders can improve the organization’s dynamism and foster employees' awareness along with their positive thought. hypothesis two was accepted that is ethical leadership positively affects employees' spirituality. the direct effect of employees' spirituality on innovation orientation is also significant. in fact, employees’ identification with the organization, their attachment to counterparts, and alignment of their values with the organization’s mission and objectives may improve the managers’ attitude toward their innovative capability. moreover, results implicated the mediation of spirituality in the relationship between ethical leadership and innovation orientation. accordingly, through their fair behaviors, ethical leaders are capable of improving the organization’s innovation orientation as a result of employees’ creativity. in total, this research provides valuable thoughts for those managers looking for implementing the innovation orientation.

CONCLUSIONS & SUGGESTIONS

Previous pieces of research suggest that, in the light of employees’ spiritual beliefs, ethical leadership equips the organization with innovative competencies and capabilities. the current research was to explain a mechanism through which ethical leadership affects the organization’s innovation orientation. ethical leadership, probably with the aid of variables such as fairness, role clarity, and authority delegation, is capable of increasing the employees’ spirituality and the organizations’ innovation orientation. the findings, indeed, implicated that employees' perception of ethical leadership may affect their attitudes and behaviors. therefore, managers should care about their ethical values and beliefs when implementing their managerial procedures. in this regard, it is suggested that managers improve organizational spirituality by means of creating a pleasant and cooperative workplace, increasing organizational cohesion, and encouraging employees to accept the organization’s goals and values. another suggestion is to create a work environment of supporting teamwork, creativity, and innovation through establishing an ethical climate and a constructive organizational culture. however, there may be limitations because of the quantitative approach of this research. in other words, the measures of ethical leadership and spirituality are in the early stages of formation and may not completely capture the qualitative nature of these constructs. future researchers are accordingly recommended conducting longitudinal studies to examine the effect of ethical leadership on independent variables more precisely.