Corporate Ethical Values and Turnover Intention

Abstract

Corporate ethical values have been studied in a number of ways to understand how they influence the behavioral intention or actions of employees to achieve organizational survival and success. Nevertheless, they have not been considered as much within international business organizations, specifically around the issue of turnover which is important for those concerned with retaining knowledgeable staff in the organization. This study develops a model that explains how corporate ethical values influence turnover intention based on social identity theory and ethical principled theory. The empirical results find that career satisfaction directly relates to turnover intention whereas corporate ethical values indirectly relate to turnover intention through the full mediation of organizational identification. Meanwhile, the effects of career satisfaction on turnover intention and on organizational identification are positively moderated by corporate ethical values. Last, managerial implications and research limitations are discussed.

Keywords

corporate ethical values turnover intention career satisfaction identification

Defined as a composite of an organization’s ethical policies and the ethical values of its managers (Bellow, 2012; Hunt, Wood, & Chonko, 1989), corporate ethical values have been studied in a number of ways to understand how they influence the behavioral intention or actions of employees (e.g., taking initiative and giving extra effort) to achieve organizational survival and success (Leung, 2008). The literature has indicated that corporate ethical values are important to the overall well-being of the corporation, its various stakeholders, and the public at large (Verschoor, 1998). Previous empirical findings have revealed that the creation of strong corporate ethical values is necessary to prevent unfavorable acts or unethical intention (Leung, 2008). Despite the abundant literature regarding corporate ethical values, they have not been considered as much within international business organizations, specifically around the issue of turnover intention which is important for those concerned with retaining knowledgeable staff in the organization (Takawira, Coetzee, & Schreuder, 2014).

Turnover intention has been always an important issue for business organizations, because high turnover rate can seriously hurt workplace morale and prohibit employees from developing commitment or identification toward their firm (e.g., Knippenberg & Schie, 2000; K. E. Lee & Shin, 2005). Turnover intention is defined as a deliberate and conscious willfulness to leave the organization within a foreseeable future (Ertureten, Cemalcilar, & Aycan, 2013). Since turnover intention is the best predictor of actual turnover behavior (e.g., Griffeth, Hom, & Gaertner, 2000; Van Breukelen, Van der Vlist, & Steensma, 2004), it comes of high importance for management to examine the relationship among turnover intention, its predictors, and moderators from a viewpoint of corporate ethical values that have been gaining key influence to date. More specifically, while turnover intention has been often discussed from various aspects irrelevant to ethics (e.g., pay satisfaction, organizational commitment, organizational support, leader–member exchange, identification, etc.), this study complements previous literature by exploring the key role of corporate ethical values in the development of turnover intention.

Corporate ethical values provide cues about a firm’s actions expected by employees. As a result, a firm with stronger corporate ethical values is more likely to win the identification of its employees (e.g., Wang, Tsai, & Lin, 2013) and to consequently reduce their turnover intention. Corporate ethical values can create the pervasive moral atmosphere of a social system characterized by shared perceptions of rightness as well as consensuses about how ethical concerns should be addressed (Cohen, 1993). Previous research suggests that corporate ethical values represent a major pillar for supporting international business organizations to improve the organization–employee relationship (Gu, Tang, & Jiang, 2013; Jones, Felps, & Bigley, 2007). For example, previous literature has indicated that ethical misconduct (i.e., a lack of corporate ethical values) can erode organizational legitimacy and integrity in a long run (Suddaby, Gendron, & Lam, 2009), eventually boosting employees’ intention to quite their job. This is understandable because when corporate ethical values are not strong, the organizational legitimacy and integrity can become shaky and the employees do not know what stands for on their current operation and functions (Vargas-Hernández, de León-Arias, Valdez-Zepeda, & Castillo-Girón, 2012). Despite the importance of corporate ethical values, it is somewhat surprising that there has been virtually no theoretical or empirical analysis on turnover intention by simultaneously evaluating the dual role of corporate ethical values as a predictor and moderator, which is thoroughly assessed in this study. Without understanding the main effect and moderating effect of corporate ethical values, our knowledge about them will remain highly limited, and management initiatives taken to reduce turnover will remain ineffective based on managers’ subjective misconception.

The empirical results of this study show that corporate ethical values indirectly relate to turnover intention through the full mediation of organizational identification, whereas career satisfaction directly relates to turnover intention. At the same time, corporate ethical values positively moderate the effects of career satisfaction on organizational identification and on turnover intention. Our research model and hypotheses along with their theoretical rationale are presented in the following sections.

Theory and Conceptual Model

This research develops a conceptual model (see Figure 1) based on social identity theory and ethical principled theory to explain the moderation of corporate ethical values in the development of turnover intention. In the model, turnover is influenced by both career satisfaction and corporate ethical values directly and indirectly via the mediation of organizational identification. Meanwhile, the effects of career satisfaction on turnover intention and organizational identification, and the effect of organizational identification on turnover intention are all hypothetically moderated by corporate ethical values. Career satisfaction and corporate ethical values are included in a single model setting because they represent, respectively, extrinsic motivation (e.g., Judge, Klinger, & Simon, 2010) and intrinsic motivation (Graafland & Van De Ven, 2006) in workplaces that promote employees’ perceptual cognitive connection toward a specific organization.

Figure 1.

Research model.

Although social identity theory (e.g., Hogg & Terry, 2000) and ethical principled theory (Hasnas, 1998) have both paid close attention to individuals’ psychological perceptions toward their group, these two theories have developed in isolation from each other. To move toward a more in-depth understanding of employees’ psychological perceptions toward their organization, this study integrates insights from both theories to explain turnover intention. Turnover intention is a key concern to organizations (Cascio, 1982) and is also highly relevant in an analysis of the psychological perceptions of employees toward their organization based on these two theories. Accordingly, this research contributes to the literature of organizational studies by explicating how the social identity theory and ethical principled theory can be integrated to effectively justify the moderation of corporate ethical values in the formation of turnover intention.

The social identity theory serves as a theoretical base for our hypotheses because previous literature has strongly recommended that social identification in organizational contexts is a powerful concept to explain employees’ turnover intention (e.g., Van Dick et al., 2004). The primary assumption of social identity theory is that social identification with an organization involves the incorporation of the organization’s values and norms into the employees’ self-concept (Tajfel & Turner, 1986). If the employees’ social identity (e.g., feeling proud of being the members of the organization) is strong (Turner, Hogg, Oakes, Reicher, & Wetherell, 1987), a negative association between employees’ organizational identification and their intent to leave the organization is likely to appear (Van Dick et al., 2004). At the same time, career satisfaction is intrinsically rewarding and thus serves employees’ self-enhancement that increases their involvement with and/or attachment to the organization (i.e., organizational identification). Organizational identification is a key factor that reflects the specific ways in which employees define themselves in terms of their membership in a business organization (Mael & Ashforth, 1995). According to social identity theory, the more employees are satisfied with their career development in an organization, the more the organization’s interests are incorporated in the self-concept, and the more likely the employees are to act with the organization’s best interest in mind (Van Knippenberg, Van Dick, & Tavares, 2007), leading to a positive relationship between career satisfaction and organizational identification.

According to social identity theory, organizational identification negatively relates to turnover intention for two critical reasons. First, organizational identification reflects the extent of perceived overlap between an employee’s self-concept and the norms and goals of the organization (Van Dick et al., 2004). Hence, organizational identification is a broad feeling of shared fate between self and organization and, consequently, a highly identified employee should be less inclined to quit the job. (Van Dick et al., 2004). Second, turnover intention may be assumed as somewhat going against the organization’s interest, whereas organizational identification motivates individuals to pursue that very interest for the organization (Van Knippenberg et al., 2007). For that reason, there exists a negative relationship between organizational identification and turnover intention. Note that although the negative relationship between organizational identification and turnover intention has been tested in previous literature, hypothesizing such relationship in this study is necessary for the completeness of our research model and also for verifying the cross validation of the relationship to complement the previous literature. In summary of these two reasons, the relationship between organizational identification and turnover intention can be derived as given below:

Hypothesis 1: Organizational identification negatively relates to turnover intention.

Career satisfaction is considered a subjective career success that is defined by the employees’ satisfaction with their career accomplishments (Joo & Park, 2010). Career satisfaction and career success have been used interchangeably in career research. In case of career dissatisfaction, employees are strongly inclined to search for possible solutions (e.g., turnover) so as to get ahead with their career development (Nauta, Vianen, Heijden, Dam, & Willemsen, 2009). For that reason, employees are most likely to have high turnover intention when their psychological well-being and career satisfaction in workplaces are low (Wright & Bonett, 2007), leading to a direct and negative relationship between career satisfaction and turnover intention.

Career satisfaction can influence turnover intention indirectly through organizational identification. Specifically, when individuals perceive their work context in a positive manner due to great ethical values, they would develop a stronger identification with their organization, which in turn avoids negative intention (e.g., turnover intention). In other words, strong ethical values fulfill employees’ needs for affiliation and social identity, simultaneously facilitating their feelings of being the members in the organization and their intention of continuing working for the organization. Previous literature has suggested that employees’ satisfaction about their career development is highly associated with organizational identification (Schneider, Hall, & Nygren, 1971). Such career development includes, for instance, the opportunity to fulfill their career potential and the opportunity for career advancement through promotion (Reade, 2001). Previous studies have found that career satisfaction is a form of reward that influences organizational identification (e.g., Brown, 1969; S. M. Lee, 1971). That is, employees’ career satisfaction enhances the perception of oneness with or belongingness to an organization (Lincoln & Kalleberg, 1989). Prior empirical research has indicated that perceived opportunity for career fulfillment and advancement can eventually strengthen organizational identification (Reade, 2001). Since identification involves employees’ self-concept derived from membership in a firm, employees who are satisfied with their career development more highly are more likely to foster identification with the firm (DeConinck, 2011), subsequently resulting in their reduced turnover intention. In summary, the second hypothesis can be stated as given below:

Hypothesis 2: Career satisfaction relates to turnover intention directly and indirectly through the partial mediation of organizational identification.

Although the literature has not assessed the association between corporate ethical values and organizational identification, previous research based on the ethical principled perspective has recognized the potential effect of corporate ethical values on affective organizational commitment (Shafer, 2009). For instance, Treviño, Butterfield, and McCabe (1998) suggest that affective organizational commitment is often lower when the corporate values are perceived as egoistic and higher when the values are perceived as principled. Their finding is consistent with the observation that employees often feel more emotionally attached to an organization that supports values such as caring for employees and the broader community and adherence to ethical principles (Shafer, 2009). Analogously, corporate ethical values are hypothetically related to organizational identification in a similar fashion according to ethical principled theory. Ethical principled theory suggests that employees strongly identify themselves as parts of the organization when the organization advocates the deontological principles of moral philosophy in tackling ethical dilemmas (Rothwell & Baldwin, 2007). In other words, the organization’s decision-making criteria that reflect widely accepted ethical standards or social principles of wrong and right can substantially influence employees’ identification with the organization (Barnett & Vaicys, 2000; Rothwell & Baldwin, 2007). According to Kohlberg (1984), as corporate ethical values increase, employees progress from concern for self, to concern for different stakeholders, and to concern for social standards (Cullen, Victor, & Bronson, 1993). Influenced by corporate ethical values, organizational outcomes such as organizational identification and turnover intention are likely to increase or decrease.

From an ethical principled perspective, Valentine, Greller, and Richtermeyer (2006) have studied how organizational ethical principles can affect employees’ job attitudes and turnover intention. They indicate that although salespeople are believed to be physically, psychologically, and socially separated from the organization, the corporate ethical values substantially influence their turnover intention (Valentine et al., 2006). De George (1990) argues that employees who do not believe they fit with an organization in terms of ethics usually do not stay long in the organization. For example, a prior study that assessed an ethical dimension of climate—honesty—showed that the greater the congruence between employees and their organizational ethical values, the lower the turnover intention (Apasu, 1986). Accordingly, employees who work in an organization with stronger corporate ethical values have less intention to leave the organization (Schwepker, 2001). Cacioppe, Forster, and Fox (2008) indicates that a socially responsible firm can attract and retain quality employees because its ethical values are closely aligned to those of the employees, consequently reducing turnover intention. Previous literature argues that those who felt they were employed in an environment with great ethical values were less likely to leave their positions (Sims & Keon, 1997).

Meanwhile, corporate ethical values can negatively influence turnover intention through organizational identification. The partial mediating role of organization identification is consistent with the proposition inherent in the social identity perspective that employees’ experiences in the social system are associated with their organizational identification, which in turn guides their future intention in the social system. Since identification involves employees’ self-concept derived from membership in a firm, employees who perceive stronger corporate ethical values in the firm are more likely to foster identification with the firm (DeConinck, 2011), consequently decreasing their turnover intention. Corporate ethical values represent a pervasive norm of conduct that substantially affects employees’ perception of oneness with the organization and employees’ conscious willingness to leave the organization. Accordingly, given the negative and direct effect of organizational identification on turnover intention, corporate ethical values can enhance turnover intention directly and indirectly via organizational identification. Corporate ethical values serve as a perceptual lens through which employees diagnose and evaluate organizational situations (Kang, Stewart, & Kim, 2011). If their perceptions of acceptable and ethical actions are cumulated continuously over time, employees tend to identity with their organization. That is, the higher level of corporate ethical values, the more likely employees will increase the perception of oneness with or belongingness to an organization (Verbos, Gerard, Forshey, Harding, & Miller, 2007). Consequently, the hypothesis about corporate ethical values and turnover intention can be depicted as given below:

Hypothesis 3: Corporate ethical values relate to turnover intention directly and indirectly through the partial mediation of organizational identification.

Prior studies (e.g., Babin, Boles, & Robin, 2000; Fournier, Tanner, Chonko, & Manolis, 2010) have called for more research relating corporate ethical values as a moderator to other pertinent organizational factors. An element of strong corporate ethical values is high trustworthiness such that employees believe that their involvement in or attachment to the organization will not be exploited. For that reason, the salience of their organizational identification is more likely amplified with the increasing corporate ethical values (i.e., their interaction effect). On the contrary, a lack of corporate ethical values signals unreliability that raises high levels of suspicion and tension between employees and their organization, substantially weakening organizational identification and enlarging turnover intention with a similar fashion.

Under stronger corporate ethical values, employees’ organizational identification becomes more influential to reduce turnover intention by their taking ethical actions that benefit the whole organization in ethical dilemmas (e.g., Appelbaum, Deguire, & Lay, 2005; Haslam & Ellemers, 2005; E. S. Lee, Park, & Koo, 2015). On the contrary, employees who perceive weaker corporate ethical values are more likely to have higher turnover intention regardless of their organizational identification, partly because they are incapable of dealing with ethical dilemmas in workplaces. Consequently, we expect corporate ethical values to positively moderate the relationship between organizational identification and turnover intention.

Hypothesis 4: Corporate ethical values moderate the negative relationship between organizational identification and turnover intention, such that the relationship is stronger when corporate ethical values are stronger.

Corporate ethical values can positively alter the relationship between the effect of career satisfaction and its outcomes because corporate ethical values help employees resolve the inner conflict about inconsistent expectations from different managers, diminish the confusion about job career development (Jaramillo, Mulki, & Solomon, 2006), and provide information and cues that show the proper ways to process, assess, and then address potential workplace dilemmas (Zhu, Avolio, Riggio, & Sosik, 2011). For example, given weak corporate ethical values, employees’ turnover intention is likely aroused and encouraged even if their satisfaction about career success is not low. In other words, great corporate ethical values amplify the beneficial effect of career satisfaction, thus reducing turnover intention to a larger extent. The hypothesis is thus derived as below:

Hypothesis 5: Corporate ethical values positively moderate the positive relationship between career satisfaction and turnover intention, such that the relationship is higher when corporate ethical values are stronger.

Poor corporate ethical values exacerbate the positive relationship between career satisfaction and organizational identification, because employees under such poor values are likely to lose their touch with career development or success (e.g., Herndon, Fraedrich, & Yeh, 2001), which represents a key to better facilitate organizational identification. In other words, even with their high career satisfaction, employees in poor corporate ethical values are more likely to experience dissonance or disappointment regarding the perceived ethical norms of the organization (Koh & Boo 2001; Lamm, Tosti-Kharas, & King, 2014), weakening the positive effect of career satisfaction on organizational identification. Based on the above rationale, the last hypothesis can be stated as below:

Hypothesis 6: Corporate ethical values positively moderate the positive relationship between career satisfaction and organizational identification, such that the relationship is higher when corporate ethical values are stronger.

Method

Participants and Procedures

The research hypotheses described above were empirically tested using a survey of workers from the high-tech industry in Taiwan. This study chose the high-tech industry because this industry has relatively high turnover rate (Chien & Chen, 2007). In order to encourage our participants to help fill out our questionnaires, this study assured the participants that data collected through its anonymous questionnaire would be used only for statistical analyses and any data relating to personal privacy would be kept highly confidential under all circumstances. The same participants were surveyed twice with 1 month apart. Specifically, they were invited to measure career satisfaction, corporate ethical values, and organizational identification in the first survey and then were contacted again to measure their turnover intention 1 month later (i.e., the second survey). Two surveys were linked by the last four digits of the participants’ mobile phone numbers.

In this study, common method variances (CMVs) are unlikely a threat herein because of three important reasons. First, this study applies high-quality scale items by first drawing from the existing literature, next refining them via a pilot, and then using them in the anonymous survey, consequently reducing the potential threat of CMV. Previous literature has argued that CMV can be reduced through the use of high-quality scales and the application of anonymous surveys (Feng, Sun, & Zhang, 2010; Helm & Conrad, 2015; Podsakoff, MacKenzie, Lee, & Podsakoff, 2012). Second, our data collected from the same participants twice at two different time points can effectively reduce the threat of common method bias. This survey strategy is the most critical than any post hoc statistical methods for detecting or reducing CMV (Chen & Lin, 2014). Previous research has argued that CMV may be caused by a one-time survey (Lin & Bhattacherjee, 2008, 2009). Third, a threat of CMVs can be substantially reduced due to the main focus of this study on the moderating role (i.e., interaction effects) of corporate ethical values. As interactions are less subject to common sources in a statistical analysis, this study is less likely to suffer CMV (Chen & Lin, 2013; Tsai, Joe, Lin, & Wang, 2014). Testing moderating effects has the advantage of mitigating the CMV threat (Chen and Lin, 2014). The main logic is that more complex relationships caused by moderating effects are less susceptible to CMV, because such relationships are unlikely to be a part of respondents’ cognitive maps (Chang, van Witteloostuijn, & Eden, 2010). Because of these three reasons, the study can substantially lessen the bias effects caused by CMV.

Of the 600 questionnaires distributed to the working professionals from 12 high-tech firms in a well-known industrial zone in Taiwan, 349 usable questionnaires were returned for a questionnaire response rate of 58.17%. In our sample, 59.31% of the participants are male (i.e., 207 persons), 56.16% with bachelor degree or above (i.e., 196 persons), 12.89% are junior employees in their current organization for 2 years or less (i.e., 45 persons). In terms of the age range of our sample, 11.46% of the participants are between 20 and 29 years old (i.e., 40 persons), 38.68% are between 30 and 39 years old (i.e., 135 persons), 23.21% are between 40 and 49 years old (i.e., 81 persons), and the remaining 26.65% are 50 years or older (i.e., 93 persons).

Measures

The constructs in this study were measured using 5-point Likert-type scales translated from existing literature and were reworded by a focus group familiar with organizational behavior and human resource management. A pilot test was conducted before the actual survey to assess the quality of our scale items. Respondents in the pilot were encouraged to indicate any confusing items for our reference. The data of the pilot test were subjected to exploratory factor analysis and reliability analysis. Based on the results of the pilot test, items with poor loadings were further refined or eliminated. The appendix lists all the measurement items and sources.

Data Analysis

The survey data were first analyzed using a two-step structural equation modeling (SEM; Anderson & Gerbing, 1998) with the CALIS (covariance analysis of linear structural equations) procedure in the SAS software. The CALIS procedure is an SAS system procedure that allows scholars to perform SEM analyses (Hatcher, 1994). Such analyses help estimate the parameters in the research model and assess its goodness-of-fit (Anderson & Gerbing, 1998). Specifically, the assessment of model fit indices is very important in CFA, as the fit indices provide evidence to confirm the model (Hatcher, 1994). All in all, the CALIS procedure is a very effective tool for testing the hypotheses of this study. Furthermore, after our analysis of SEM, the moderating effects of corporate ethical values were examined by conducting moderated regression analysis. Empirical results from each analysis are presented in the following sections.

Confirmatory Factor Analysis

In confirmatory factor analysis, the overall goodness-of-fit indices shown in Table 1 indicate that the model hypothesized in this study ﬁts well with the empirical data collection. Specifically, the test results show that the comparative fit index (CFI), normed fit index (NFI), and nonnormed fit index (NNFI) all exceeded 0.90, while the root mean square residual (RMR) and the root mean square error of approximation (RMSEA) were both smaller than 0.08 (MacCallum, Browne, & Sugawara, 1996). Convergent validity is supported in this study because all factor loadings were statistically significant. Besides, the average variance extracted (AVE) for all constructs were greater than 0.50, and the reliabilities for each construct exceeded .70 (Fornell & Larcker, 1981).

Table 1.

Standardized Loadings and Reliabilities.

Construct	Indicators	Standardized loading	AVE	Cronbach’s α
Turnover intention	TI1	0.78 (t = 17.21)	0.76	.95
	TI2	0.92 (t = 22.76)
	TI3	0.92 (t = 22.55)
	TI4	0.84 (t = 19.52)
	TI5	0.91 (t = 22.36)
Organizational identification	OI1	0.79 (t = 17.23)	0.59	.89
	OI2	0.74 (t = 15.56)
	OI3	0.77 (t = 16.49)
	OI4	0.76 (t = 16.33)
	OI5	0.77 (t = 16.63)
	OI6	0.80 (t = 17.58)
Career satisfaction	CS1	0.86 (t = 19.85)	0.73	.93
	CS2	0.88 (t = 20.65)
	CS3	0.87 (t = 20.27)
	CS4	0.86 (t = 19.92)
	CS5	0.81 (t = 18.09)
Corporate ethical values	EC1	0.73 (t = 15.15)	0.60	.86
	EC2	0.82 (t = 17.85)
	EC3	0.82 (t = 17.89)
	EC4	0.74 (t = 15.51)

Note. AVE = average variance extracted. Goodness-of-fit indices (N = 349): χ²₁₆₄ = 519.04 (p < .001); nonnormed fit index (NNFI) = 0.93; normed fit index (NFI) = 0.91; comparative fit index (CFI) = 0.94; root mean square residual (RMR) = 0.04; root mean square error of approximation (RMSEA) = 0.08.

Chi-square difference tests were applied to evaluate discriminant validity. As chi-square difference statistics for all pairs of constructs in Table 2 exceeded their critical value based on the experiment-wise error rate at overall significance level of .01, high discriminant validity for the data sample of this study is confirmed.

Table 2.

Chi-Square Difference Tests for Examining Discriminate Validity.

Construct pair	χ²₁₆₄ = 519.04 (Unconstrained model)
Construct pair	χ²₁₆₅ (Constrained model)	χ² Difference
(F1, F2)	2753.16	2234.12
(F1, F3)	1504.78	985.74
(F1, F4)	2622.50	2103.46
(F2, F3)	1387.23	868.19
(F2, F4)	654.75	135.71
(F3, F4)	1002.93	483.89

Note. F1 = Turnover intention; F2 = Organizational identification; F3 = Career satisfaction; F4 = Corporate ethical values.

***

Significant at the .001 overall significance level by the Bonferroni method.

Structural Model Testing

After the above confirmatory factor analysis is completed, a structural model that reflects the model paths hypothesized in our study was tested. Table 3 presents the empirical results of our statistical analysis (see also Figure 2), which indicates that three out of five model paths of our research model were confirmed at the significance level of .01. In summary, organizational identification negatively relates to turnover intention (thus, Hypothesis 1 is supported). Career satisfaction relates to turnover intention directly but does not have an indirect effect on turnover intention (thus, Hypothesis 2 is partially supported). Finally, corporate ethical values only relates to turnover intention indirectly through organizational identification (thus, Hypothesis 3 is partially supported).

Table 3.

Test Results of Structural Equation Modeling.

Hypothesis	Path coefficient
Organizational identification → Turnover intention	−0.24*
Career satisfaction → Turnover intention	−0.37**
Career satisfaction → Organizational identification	0.03
Corporate ethical values → Turnover intention	−0.10
Corporate ethical values → Organizational identification	0.64**

Note. Gender, age, education, marriage, work experience, and firms are included as control variables in the model.

p < .05. **p < .01.

Figure 2.

Summarized test results.

With regard to our moderating effects, moderated regression analysis was used to test the hypotheses (Hypotheses 4 and 5; see Table 4). The test result in Model 1 indicates that there is no significant moderating effect of corporate ethical values on the relationship between organizational identification and turnover intention (Hypothesis 4 is not supported). Meanwhile, corporate ethical values positively moderate the relationship between career satisfaction and turnover intention (Hypothesis 5 is supported). Finally, the test result in Model 2 shows that corporate ethical values positively moderate the relationship between career satisfaction and organizational identification (Hypothesis 6 is supported). Based on the above empirical tests, we summarize the final results of our hypotheses in Table 5. Of our six hypotheses, this study obtains three fully supported hypotheses, two partially supported hypotheses, and one unsupported hypothesis.

Table 4.

Moderated Regression Analysis.

	Model 1	Model 2
	Turnover intention	Firm identification
Control variables
Gender	0.04	−0.01
Age	−0.01	0.01
Education	−0.01	−0.01
Marriage	−0.13	0.09
Work experience (year)	0.16	0.03
Firm 1	0.26	−0.71**
Firm 2	0.28	−0.75**
Firm 3	−0.15	−0.16
Firm 4	−0.27	0.02
Firm 5	−0.29	0.04
Firm 6	−0.08	−0.03
Firm 7	−0.38*	−0.07
Firm 8	−0.31	−0.03
Firm 9	−0.26	−0.05
Firm 10	0.27	0.04
Firm 11	0.02	−0.01
Firm 12	—	—
Antecedents and mediator
Organizational identification	−0.16
Career satisfaction	−0.98**	−0.55**
Corporate ethical values	−0.60	−0.01
Interaction terms
Corporate ethical values * Organizational identification	−0.04
Corporate ethical values * Career satisfaction	0.17*	0.15**
Adj R²	0.48	0.65

Note. Firm numbers are included as control variables with a technique of dummy variables. “—” for the 12th level of the variable represents an omission from the regression equations because our specifying 11 dummy variables in this study automatically specifies the 12th one.

p < .05. **p < .01.

Table 5.

Summary of Test Results.

Hypotheses	Results
Hypothesis 1: Organizational identification negatively relates to turnover intention.	Supported
Hypothesis 2: Career satisfaction relates to turnover intention directly and indirectly through the partial mediation of organizational identification.	Partially supported
Hypothesis 3: Corporate ethical values relate to turnover intention directly and indirectly through the partial mediation of organizational identification.	Partially supported
Hypothesis 4: Corporate ethical values positively moderate the positive relationship between organizational identification and turnover intention, such that the relationship is higher when corporate ethical values are stronger.	Not supported
Hypothesis 5: Corporate ethical values positively moderate the positive relationship between career satisfaction and turnover intention, such that the relationship is higher when corporate ethical values are stronger.	Supported
Hypothesis 6: Corporate ethical values positively moderate the positive relationship between career satisfaction and organizational identification, such that the relationship is higher when corporate ethical values are stronger.	Supported

Discussion

The empirical results of this study obtain some crucial findings that complement turnover intention literature. This study finds that career satisfaction directly relates to turnover intention, while corporate ethical values indirectly relate to turnover intention through organizational identification. Furthermore, the relationships between career satisfaction and turnover intention and between career satisfaction and organizational identification are both moderated by corporate ethical values. Based on these empirical results, this study presents theoretical and managerial implications as given below.

Theoretical Implications

The findings of this study provide two theoretical implications. First, this study finds that corporate ethical values have both main and moderating effects in the formation of turnover intention, complementing previous literature that focuses either on its main effect (e.g., Jaramillo et al., 2006) or on its moderating effect (Stewart, Volpone, Avery, & McKay, 2011). Previous literature on turnover intention has evaluated a variety of factors irrelevant to ethics but rarely discussed an antecedent and moderating role of corporate ethical values on turnover intention (e.g., Elçi, Kitapçı, & Ertürk, 2007; Kim & Brymer, 2011), causing a theoretical gap. Filling this gap, this study confirms such a dual role based on ethical principled theory by simultaneously including a fresh mediator (i.e., organizational identification) that has not been examined before.

Second, this study assesses whether career satisfaction influences turnover intention directly or indirectly through organizational identification based on social identity theory. Although previous research has found that career satisfaction affects turnover intention directly and indirectly through the partial mediation of organizational commitment (Igbaria & Greenhaus, 1992), no research has tried to examine whether organizational identification mediates the relationship between career satisfaction and turnover intention based on social identity theory. Our study confirms that, unlike the significant mediating role of organizational commitment in literature (Igbaria & Greenhaus, 1992), organizational identification does not mediate the relationship between career satisfaction and turnover intention. This finding can be considered an evidence for the theoretical discussion in previous research that identification and commitment uniquely reflect different aspects of the relationship between the individual and the organization (Van Knippenberg & Sleebos, 2006).

Managerial Implications

The empirical results of this research offer new insights for international business about turnover intention and how it is affected by career satisfaction and corporate ethical values through the partial mediation of organizational identification. As corporate ethical values are vital for a firm (Elias, 2011), managers should strive for continuously improving corporate ethics so as to boost employees’ ethical awareness, reasoning, and behavior (e.g., Valentine & Barnett, 2002). For example, ethical actions performed by employees should be rewarded and the codes of ethical conduct should also be programmed into training courses for new employees. Unethical behavior should be reprimanded so as to signal key messages about corporate ethical values. Once the corporate ethical values are highly developed, employees’ organizational identification is likely to increase and their turnover intention can consequently reduce.

Given the significant moderating effect of corporate ethical values on the positive relationship between career satisfaction and turnover intention, close attention should be paid to understand employees’ career satisfaction. Effective actions to improve career satisfaction among employees with low scores of such satisfaction should be taken, including raises of payment, reduction of work hours, fair procedures for promotion, and increased employees’ participation in decision making that fosters satisfaction related to workplaces (Bettes, Chalas, Coleman, & Schulkin, 2004).

As corporate ethical values are a powerful force in explaining employees’ perception of oneness with or belongingness to a firm, they should not be taken for granted as the “common sense” of the firm and therefore require in-depth articulation for increasing employees’ awareness and conformity in the firm. The more employees perceive their firm as showing concern for corporate ethics, acting ethically, and praising ethical behavior (i.e., strong corporate ethical values), the more positive is the resulting influence on employees’ identification toward the firm. The indices of corporate ethical values may be developed to enhance the extent to which the employees in the firm are aware of explicitly stated ethical norms and set corporate values. Such indices can be applied to observe changes of employees’ awareness about ethical values over time and could become a warning signal of potential problems (e.g., decreasing levels of organizational identification).

To sum up, this study discovers the key moderation of corporate ethical values in the formation of turnover intention. Employees in a firm with strong ethical values as their guidance are certain to overcome ethical dilemmas, to identify with their organization strongly, and to stay in the firm instead of quitting the job. Corporate ethical values can be considered an organization’s system that substantially reinforces its operations. Such values should be gradually refined in a long run via open-minded dialogues among organizational members.

Limitations

In spite of our efforts on this research, two apparent limitations should be mentioned and clarified. The first limitation is the cross-sectional nature that exists due to the data collection method of this study. This limitation may confine the ability of this study to obtain causal inferences based on its data. Second, this study was conducted only on one industry: Taiwan’s high-tech industry. As a result, the implications drawn from this study may not be highly generalizable to understand the turnover intention of employees in traditional industry such as tourist industry or food industry.

Since longitudinal data are essential for supporting strong causal inferences, future studies may improve the shortcomings of this study by recording the participants’ actual behavior over time. Besides, future research is advised to include more factors related to business ethics (e.g., ethical climate, ethical fit, ethical conflict, ethics stress) drawn from different theories so as to explain turnover intention in a broader perspective. Last but not least, the test results related to our unsupported or partially supported hypotheses should be further examined in future studies so that the relationship between turnover intention, its predictors, and outcomes can be authentically confirmed.

Footnotes

Appendix

Declaration of Conflicting Interests

The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.

Funding

The author(s) received no financial support for the research, authorship, and/or publication of this article.

Author Biographies

Chu-Mei Liu is an associate professor in the Department of International Business, Tamkang University, Taiwan. Her research interests focus on international business, organizational behavior and human resource management.

Chieh-Peng Lin is a professor in the Institute of Business & Management, National Chiao Tung University, Taiwan. His work has been published in a variety of journals, including Asian Journal of Social Psychology, Computers in Human Behavior, CyberPsychology & Behavior, Electronic Commerce Research and Applications, Group & Organization Management, Human Factors, Information Systems Journal, International Journal of Electronic Commerce, Journal of Business Ethics, Online Information Review, Personnel Review, Service Industries Journal, Social Science Journal, Technological Forecasting and Social Change, and so on.

References

Anderson

J. C.

Gerbing

D. W.

(1998). Structural equation modeling in practice: A review and recommended two-step approach. Psychological Bulletin, 103, 411-423.

Apasu

(1986). Identifying the antecedents of salespersons’ intention to leave. Akron Business and Economic Review, 17, 85-97.

Appelbaum

S. H.

Deguire

K. J.

Lay

(2005). The relationship of ethical climate to deviant workplace behaviour. Corporate Governance, 5, 43-55.

Babin

B. J.

Robin

D. P.

(2000). Representing the perceived ethical work climate among marketing employees. Journal of Academy of Marketing Science, 28, 345-358.

Barnett

Vaicys

(2000). The moderating effect of individuals’ perceptions of ethical work climate on ethical judgments and behavioral intentions. Journal of Business Ethics, 27, 351-362.

Bellow

(2012). Ethical corporate marketing and societal expectations. Journal of Marketing Development and Competitiveness, 6, 11-26.

Bettes

B. A.

Chalas

Coleman

V. H.

Schulkin

(2004). Heavier workload, less personal control: Impact of delivery on obstetrician/gynecologists’ career satisfaction. American Journal of Obstetrics and Gynecology, 190, 851-857.

Brown

(1969). Identification and some conditions of organizational involvement. Administrative Science Quarterly, 14, 346-355.

Cacioppe

Forster

Fox

(2008). A survey of manager’s perceptions of corporate ethics and social responsibility and actions that may affect companies’ success. Journal of Business Ethics, 82, 681-700.

10.

Cascio

W. F.

(1982). Costing human resources: The financial aspect of human behavior in organizations. Boston, MA: Kent.

11.

Chang

van Witteloostuijn

Eden

(2010). From the editors: Common method variance in international business research. Journal of International Business Studies, 41, 178-184.

12.

Chen

M. L.

Lin

C. P.

(2013). Assessing the effects of cultural intelligence on team knowledge sharing from a socio-cognitive perspective. Human Resource Management, 52, 675-695.

13.

Chen

M. L.

Lin

C. P.

(2014). Modeling perceived corporate citizenship and psychological contracts: A mediating mechanism of perceived job self-efficacy. European Journal of Work and Organizational Psychology, 23, 231-247.

14.

Chien

C. F.

Chen

L. F.

(2007). Using rough set theory to recruit and retain high-potential talents for semiconductor manufacturing. IEEE Transactions on Semiconductor Manufacturing, 20, 528-541.

15.

Cohen

D. V.

(1993). Creating and maintaining ethical work climates: Anomie in the workplace and implications for managing change. Business Ethics Quarterly, 3, 343-358.

16.

Cullen

J. B.

Victor

Bronson

J. W.

(1993). The ethical climate questionnaire: An assessment of its development and validity. Psychological Reports, 73, 667-675.

17.

De George

R. T

. (1990). Business ethics (3rd ed.). New York, NY: Macmillan.

18.

DeConinck

J. B.

(2011). The effects of ethical climate on organizational identification, supervisory trust, and turnover among salespeople. Journal of Business Research, 64, 617-624.

19.

Dysvik

Kuvaas

(2013). Perceived job autonomy and turnover intention: The moderating role of perceived supervisor support. European Journal of Work and Organizational Psychology, 22, 563-573.

20.

Elçi

Kitapçı

Ertürk

(2007). Effects of quality culture and corporate ethical values on employee work attitudes and job performance in Turkey: An integrative approach. Total Quality Management and Business Excellence, 18, 285-302.

21.

Elias

R. Z.

(2011). The effect of corporate ethical values on accountants’ perceptions of social responsibility. Journal of Applied Business Research, 21, 1-10.

22.

Ertureten

Cemalcilar

Aycan

(2013). The relationship of downward mobbing with leadership style and organizational attitudes. Journal of Business Ethics, 116, 205-216.

23.

Feng

Sun

Zhang

(2010). The effects of customer and supplier involvement on competitive advantage: An empirical study in China. Industrial Marketing Management, 39, 1384-1394.

24.

Fornell

Larcker

D. F.

(1981). Structural equation models with unobservable variables and measurement error: Algebra and statistics. Journal of Marketing Research, 18, 382-388.

25.

Fournier

Tanner

J. F.

Jr. Chonko

L. B.

Manolis

(2010). The moderating role of ethical climate on salesperson propensity to leave. Journal of Personal Selling & Sales Management, 30, 7-22.

26.

Graafland

Van

Ven

(2006). Strategic and moral motivation for corporate social responsibility. Journal of Corporate Citizenship, 22, 111-123.

27.

Greenhaus

J. H.

Parasuraman

Wormley

W. M.

(1990). Effects of race on organizational experiences, job performance evaluations, and career outcomes. Academy of Management Journal, 33, 64-86.

28.

Griffeth

R. W.

Hom

P. W.

Gaertner

(2000). A meta-analysis of antecedents and correlates of employee turnover: Update, moderator tests, and research implications for the next millennium. Journal of Management, 26, 463-488.

29.

Tang

T. L. P.

Jiang

(2013). Does moral leadership enhance employee creativity? Employee identification with leader and leader–member exchange (LMX) in the Chinese context. Journal of Business Ethics, 126, 513-529.

30.

Haslam

S. A.

Ellemers

(2005). Social identity in industrial and organizational psychology: Concepts, controversies, and contributions. In Hodgkinson

G. P.

Ford

J. K.

(Eds.), International review of industrial and organizational psychology (Vol. 20, pp. 39-118). Chichester, England: Wiley.

31.

Hasnas

(1998). The normative theories of business ethics: A guide for the perplexed. Business Ethics Quarterly, 8, 19-42.

32.

Hatcher

(1994). A step-by-step approach to using the SAS system for factor analysis and structural equation modeling. Cary, NC: SAS Institute.

33.

Helm

Conrad

(2015). The impact of customer-specific and market-related variables on the preference for highly innovative products. Review of Managerial Science, 9, 61-88.

34.

Herndon

N. C.

Jr. Fraedrich

J. P.

Yeh

Q. J.

(2001). An investigation of moral values and the ethical content of the corporate culture: Taiwanese versus US sales people. Journal of Business Ethics, 30, 73-85.

35.

Hogg

M. A.

Terry

D. J.

(2000). Social identity and self-categorization processes in organizational contexts. Academy of Management Review, 25, 121-140.

36.

Hunt

S. D.

Wood

Chonko

(1989). Corporate ethical values and organizational commitment in marketing. Journal of Marketing, 53, 79-90.

37.

Igbaria

Greenhaus

J. H.

(1992). Determinants of MIS employees’ turnover intentions: A structural equation model. Communications of the ACM, 35, 34-49.

38.

Jaramillo

Mulki

J. P.

Solomon

(2006). The role of ethical climate on salesperson’s role stress, job attitudes, turnover intention, and job performance. Journal of Personal Selling & Sales Management, 26, 271-282.

39.

Jones

T. M.

Felps

Bigley

G. A.

(2007). Ethical theory and stakeholder-related decisions: The role of stakeholder culture. Academy of Management Review, 32, 137-155.

40.

Joo

B. K.

Park

(2010). Career satisfaction, organizational commitment, and turnover intention: The effects of goal orientation, organizational learning culture and developmental feedback. Leadership & Organization Development Journal, 31, 482-500.

41.

Judge

T. A.

Klinger

R. L.

Simon

L. S.

(2010). Time is on my side: Time, general mental ability, human capital, and extrinsic career success. Journal of Applied Psychology, 95, 92-107.

42.

Kang

D. S.

Stewart

Kim

(2011). The effects of perceived external prestige, ethical organizational climate, and leader-member exchange (LMX) quality on employees’ commitments and their subsequent attitudes. Personnel Review, 40, 761-784.

43.

Kim

W. G.

Brymer

R. A.

(2011). The effects of ethical leadership on manager job satisfaction, commitment, behavioral outcomes, and firm performance. International Journal of Hospitality Management, 30, 1020-1026.

44.

Knippenberg

Schie

(2000). Foci and correlates of organizational identification. Journal of Occupational and Organizational Psychology, 73, 137-147.

45.

Koh

H. C.

Boo

E. H. Y.

(2001). The link between organizational ethics and job satisfaction: A study of managers in Singapore. Journal of Business Ethics, 29, 309-324.

46.

Kohlberg

(1984). The philosophy of moral development. New York, NY: Harper & Row.

47.

Lamm

Tosti-Kharas

King

C. E.

(2014). Empowering employee sustainability: Perceived organizational support toward the environment. Journal of Business Ethics, 128, 207-220.

48.

Lee

E.-S.

Park

T.-Y.

Koo

(2015, May 18). Identifying organizational identification as a basis for attitudes and behaviors: A meta-analytic review. Psychological Bulletin. Advance online publication. Retrieved from https://dx-doi-org.web.bisu.edu.cn/10.1037/bul0000012

49.

Lee

K. E.

Shin

K. H.

(2005). Job burnout, engagement and turnover intention of dietitians and chefs at a contract foodservice management company. Journal of Community Nutrition, 7, 100-106.

50.

Lee

S. M.

(1971). An empirical analysis of organizational identification. Academy of Management Journal, 14, 213-226.

51.

Leung

A. S. M.

(2008). Matching ethical work climate to in-role and extra-role behaviors in a collectivist work setting. Journal of Business Ethics, 79, 43-55.

52.

Lin

C. P.

Bhattacherjee

(2008). Elucidating individual intention to use interactive information technologies: The role of network externalities. International Journal of Electronic Commerce, 13, 85-108.

53.

Lin

C. P.

Bhattacherjee

(2009). Understanding online social support and its antecedents: A socio-cognitive model. Social Science Journal, 46, 724-737.

54.

Lincoln

Kalleberg

(1989). Culture, control and commitment: A study of work organization and work attitudes in the United States and Japan. Cambridge, England: Cambridge University Press.

55.

MacCallum

R. C.

Browne

M. W.

Sugawara

H. M.

(1996). Power analysis and determination of sample size for covariance structure modeling. Psychological Methods, 1, 130-149.

56.

Mael

F. A.

Ashforth

B. E.

(1992). Alumni and their alma mater: A partial test of the reformulated model of organizational identification. Journal of Organizational Behavior, 13, 103-123.

57.

Mael

F. A.

Ashforth

B. E.

(1995). Loyal from day one: Biodata, organizational identification, and turnover among newcomers. Personnel Psychology, 48, 309-333.

58.

Nauta

Vianen

Heijden

Dam

Willemsen

(2009). Understanding the factors that promote employability orientation: The impact of employability culture, career satisfaction, and role breadth self-efficacy. Journal of Occupational and Organizational Psychology, 82, 233-251.

59.

Podsakoff

P. M.

MacKenzie

S. B.

Podsakoff

N. P.

(2012). Sources of method bias in social science research and recommendations on how to control it. Annual Review of Psychology, 65, 539-569.

60.

Reade

(2001). Antecedents of organizational identification in multinational corporations: Fostering psychological attachment to the local subsidiary and the global organization. International Journal of Human Resource Management, 12, 1269-1291.

61.

Rothwell

G. R.

Baldwin

J. N.

(2007). Ethical climate theory, whistle-blowing, and the code of silence in police agencies in the state of Georgia. Journal of Business Ethics, 70, 341-361.

62.

Schneider

Hall

Nygren

(1971). Self image and job characteristics as correlates of changing organizational identification. Human Relations, 24, 397-416.

63.

Schwepker

C. H.

(2001). Ethical climate’s relationship to job satisfaction, organizational commitment, and turnover intention in the salesforce. Journal of Business Research, 54, 39-52.

64.

Shafer

W. E.

(2009). Ethical climate, organizational-professional conflict and organizational commitment: A study of Chinese auditors. Accounting, Auditing & Accountability Journal, 22, 1087-1110.

65.

Sims

R. L.

Keon

T. L.

(1997). Ethical work climate as a factor in the development of person–organization fit. Journal of Business Ethics, 16, 1095-1105.

66.

Stewart

Volpone

S. D.

Avery

D. R.

McKay

(2011). You support diversity, but are you ethical? Examining the interactive effects of diversity and ethical climate perceptions on turnover intentions. Journal of Business Ethics, 100, 581-593.

67.

Suddaby

Gendron

Lam

(2009). The organizational context of professionalism in accounting. Accounting, Organizations and Society, 34, 409-427.

68.

Tajfel

Turner

J. C.

(1986). The social of identity theory of intergroup behaviour. In Worchel

Austin

W. G.

(Eds.), Psychology of intergroup relations (pp. 7-24). Chicago, IL: Nelson.

69.

Takawira

Coetzee

Schreuder

(2014). Job embeddedness, work engagement and turnover intention of staff in a higher education institution: An exploratory study. SA Journal of Human Resource Management, 12, 1-10. Retrieved from http://www.sajhrm.co.za/index.php/sajhrm/article/view/524

70.

Treviño

L. K.

Butterfield

K. D.

McCabe

D. L.

(1998). The ethical context in organizations: Influences on employee attitudes and behaviors. Business Ethics Quarterly, 8, 447-476.

71.

Tsai

Y. H.

Joe

S. W.

Lin

C. P.

Wang

R. T.

(2014). Modeling job pursuit intention: Moderating mechanisms of socio-environmental consciousness. Journal of Business Ethics, 125, 287-298.

72.

Turner

J. C.

Hogg

M. A.

Oakes

P. J.

Reicher

S. D.

Wetherell

M. S.

(1987). Rediscovering the social group. Oxford, England: Blackwell.

73.

Valentine

Barnett

(2002). Ethics codes and sales professionals’ perceptions of their organizations’ ethical values. Journal of Business Ethics, 40, 191-200.

74.

Valentine

Greller

M. M.

Richtermeyer

S. B.

(2006). Employee job response as a function of ethical context and perceived organization support. Journal of Business Research, 59, 582-588.

75.

Van Breukelen

Van der Vlist

Steensma

. (2004). Voluntary employee turnover: Combining variables from the “traditional” turnover literature with the theory of planned behavior. Journal of Organizational Behavior, 25, 893-914.

76.

Van Dick

Christ

Stellmacher

Wagner

Ahlswede

Grubba

Tissington

P. A

. (2004). Should I stay or should I go? Explaining turnover intentions with organizational identification and job satisfaction. British Journal of Management, 15, 351-360.

77.

Van Knippenberg

Sleebos

. (2006). Organizational identification versus organizational commitment: Self-definition, social exchange, and job attitudes. Journal of Organizational Behavior, 27, 571-584.

78.

Van Knippenberg

Van Dick

Tavares

. (2007). Social identity and social exchange: Identification, support, and withdrawal from the job. Journal of Applied Social Psychology, 37, 457-477.

79.

Vargas-Hernández

J. G.

de León-Arias

Valdez-Zepeda

Castillo-Girón

(2012). Enhancing leadership integrity effectiveness strategy through the institutionalization of an organizational management integrity capacity systems. Journal of Knowledge Management, Economics and Information Technology, 2, 137-179.

80.

Verbos

A. K.

Gerard

J. A.

Forshey

P. R.

Harding

C. S.

Miller

J. S.

(2007). The positive ethical organization: Enacting a living code of ethics and ethical organizational identity. Journal of Business Ethics, 76, 17-33.

81.

Verschoor

C. C.

(1998). A study of the link between a corporation’s financial performance and its commitment to ethics. Journal of Business Ethics, 17, 1509-1516.

82.

Wang

Y. J.

Tsai

Y. H.

Lin

C. P.

(2013). Modeling the relationship between perceived corporate citizenship and organizational commitment considering organizational trust as a moderator. Business Ethics: A European Review, 22, 218-233.

83.

Wright

T. A.

Bonett

D. G.

(2007). Job satisfaction and psychological well-being as nonadditive predictors of workplace turnover. Journal of Management, 33, 141-160.

84.

Zhu

Avolio

B. J.

Riggio

R. E.

Sosik

J. J.

(2011). The effect of authentic transformational leadership on follower and group ethics. Leadership Quarterly, 22, 801-817.