The study assesses a model designed to investigate the mediating impact of psychological empowerment, job crafting, and proactive personality, and to examine the moderating influence of person–organization fit on the relationship between ethical leadership and employee innovative behavior. A sample of 782 full-time employees from various industries in Jordan were surveyed to gather data on ethical leadership, innovative work behaviors, psychological empowerment, job crafting, proactive personality, and person–organization fit. The study employed an empirical research design, with data collected through surveys. The results reveal a positive correlation between ethical leadership and innovative work behavior, with psychological empowerment, job crafting, and proactive personality as the mediators in this relationship. The link between ethical leadership and innovation work behaviors is also moderated by person–organization fit. The study’s model suggests that ethical leadership practices enhance innovation. Prioritizing ethical principles, transparency, fairness, trust, and accountability cultivates a culture valuing ethics and encouraging innovation. The results provide insights to boost empowerment and proactive behaviors and highlight the importance of a person–organization fit that aligns values for an innovation-friendly workplace. Fit considerations should also be incorporated in recruitment and retention processes. The study makes significant theoretical contributions by synthesizing insights from ethical leadership theory and developing a comprehensive framework to understand how ethical leadership influences innovative work behavior. The research also extends prior work by examining the moderating role of person–organization fit by emphasizing the importance of aligning individual and organizational values in fostering innovation.