Organizational Commitment and Corporate Ethical Values: Exploring the Nexus between Employees' Psychological Contract and Firms' Ethical Behaviour in the Nigerian Insurance Industry

Abstract

Commitment of employees to their organisations has been one of the central research themes in organisational study. Though, many predictors of organisational commitment abound in the literature, much is however not known on how ethical behaviour in the organisation affects employees' commitment. Considering the nature of insurance services, and high potentials for ethical dilemma in the industry, this study contributes to organisational commitment literature by providing further understanding on the impact of corporate ethical values on organisational commitment in Nigeria. Underpinned by cognitive dissonance theory, the study proposes a significant relationship between the two constructs. While controlling for some demographic factors, corporate ethical values was hypothesized as a significant determinant of organisational commitment. With data from 415 managers, collected through Hunt's et al (1989) Corporate Ethical Value and Hunt's et al (1985) organisational commitment scales, the results of the multivariate analysis were presented, and discussed with managerial implications.

Antecedents of organizational commitment of insurance agents: Job satisfaction, ethical behavior, and ethical climate

“…It was proposed that employees would exhibit a higher commitment to their organizations if they work in an ethical atmosphere and people behave ethically (Yousef, 2001). Obalola et al (2012), through a sample of 415 managers in Nigeria insurance industry, indicated that employees would show a high commitment to their company if they perceived the company as an ethical actor. Chen et al (2019) also demonstrated that ethical leadership positively relates to an employee's OC through samples of 52 manufacturing companies.…”

“…OC is an important variable that impacts the employee's performance at work and their behavioral loyalty to organizations (Liou et al, 2013;Yao et al, 2019). Researchers have conducted some studies to explore the impact of different variables on OC including leadership (Chen et al, 2019;Choi et al, 2015b;Gul et al, 2012), job security and work style (Pathak & Tripathi, 2010;Spanuth & Wald, 2017), employee training and teamwork (Hanaysha, 2016a), organizational learning (Hanaysha, 2016b), and corporate social responsibility (Asrar-ul-Haq et al, 2017;Obalola et al, 2012). Since few studies investigate deeply the impact of ethics related variables on OC of employees, this study, from the perspective of business ethics, examined the impact of EC and EB on OC and its three dimensions of insurance agents in China where companies may confront unique ethical situations.…”

“…Abundant previous studies were found on the antecedents of employees' OC in various contexts (Lambert et al, 2018;Luz et al, 2018;Pathak & Tripathi, 2010;Top et al, 2015). Several variables received great attention from previous researchers, such as different leadership styles (Chen et al, 2019;Choi et al, 2015b;Gul et al, 2012), employees' burnout (Sarisik et al, 2019), job related variables like job security and work style (Pathak & Tripathi, 2010;Spanuth & Wald, 2017), job characters (Coetzer & Rothmann, 2006), employee training and teamwork (Hanaysha, 2016a), environment and organizational learning (Hanaysha, 2016b), psychosocial safety climate (Geisler et al, 2019), corporate values, and corporate social responsibility (Asrar-ul-Haq et al, 2017;Obalola et al, 2012). However, few studies probe deeply into the impact of ethics variables on OC of employees in Chinese context where employees and managers may confront different ethical situations from other countries.…”

Examining relationships among corporate ethical values, commitment and turnover intentions

“…Friend et al (2009) suggested ethical climate as a major factor influencing the commitment level of employees in sales organizations. Also, the positive relationship of commitment and ethical climate has been established in various studies (Obalola et al, 2012;Weeks et al, 2006;Babin et al, 2000). Valentine et al (2011) confirmed the positive link between CEV and job satisfaction level of employees, which is considered as a strong antecedent and correlate of their commitment perceptions (Shahirari et al, 2012;Valentine et al, 2011;Koh and Boo, 2004;Van Scotter, 2000;Tett and Meyer, 1993).…”

The Role of Organizational Values in Commitment of Employees

“…While defined commitment as an emotional orientation towards the organization, realizing the costs associated with leaving the Organization and a normative commitment to stay with the organization [30]. In the same vein defined, commitment as a set of internal standards that lead to behavior in a manner that is consistent with the objective and interests of the organization [31]. And another one defined it is a state of loyalty and an inner sense of the individual making a high-level effort in which he hopes to increase the effectiveness of the organization [32].…”