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Home / Applied Social Science / Ethical Leadership Impact on Employee Loyalty in Small Businesses

Ethical Leadership Impact on Employee Loyalty in Small Businesses

Abstract

Ethical leadership is essential in small businesses, significantly impacting employee loyalty and retention. Research indicates that ethical leadership fosters job commitment and mitigates turnover, a critical concern for small enterprises with limited resources (Kim & Brymer, 2015). Unlike large corporations, small businesses depend on strong leader-employee relationships, making ethical leadership crucial for trust and stability (Hegarty & Moccia, 2018). High turnover disrupts operations and increases costs, threatening business sustainability. This study is a systematic review of the literature from databases such as Academic Search Ultimate and Business Source Complete where key themes including trust, transparency, accountability, and ethical culture were identified. These factors contribute to employee satisfaction and retention, emphasizing ethical leadership’s role in fostering a positive work environment and enhancing business performance. Future research can employ quantitative surveys measuring ethical leadership’s direct impact on turnover and qualitative case studies exploring ethical leadership practices in small businesses for valuable insights and strategies for long-term success.

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Discipline Applied Social Science Tags accountability, employee loyalty, employee retention, ethical leadership, Featured Studies, small businesses, transparency, trust
  • Swathi Anugu
  • May, 2025

About Author

  • Swathi Anugu
    Swathi Anugu

    Swathi Anugu holds a bachelor’s degree in computer science, mathematics, and statistics, and further pursued a master’s degree in leadership, having a passion for continuous learning and actively atte...

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Picture of Swathi Anugu

Swathi Anugu

Swathi Anugu holds a bachelor’s degree in computer science, mathematics, and statistics, and further pursued a master’s degree in leadership, having a passion for continuous learning and actively attending academic workshops to enhance technical, analytical, and problem-solving skills. Swathi Anugu builds professional experience by focusing on teamwork, leadership, and decision-making with strengths in being insightful, empathetic, and collaborative, as well as working on improving assertiveness and decisiveness to become a more effective leader. Swathi Anugu’s research interests include data analysis, technology-driven solutions, and team dynamics, having demonstrated strong teamwork and adaptability, evidenced in participating in OMADA activities, where first place was secured through collaboration and strategic thinking. Beyond academics and work, Swathi Anugu is deeply committed to personal and intellectual growth, continuously seeking new opportunities to learn and develop. As a dedicated parent, Swathi Anugu balances personal and professional life while striving to expand knowledge and skills in various domains, always passionate about fostering meaningful connections, embracing challenges, and positively impacting respective fields. https://orcid.org/0009-0007-5514-6858
Know More
Picture of Swathi Anugu

Swathi Anugu

Swathi Anugu holds a bachelor’s degree in computer science, mathematics, and statistics, and further pursued a master’s degree in leadership, having a passion for continuous learning and actively attending academic workshops to enhance technical, analytical, and problem-solving skills. Swathi Anugu builds professional experience by focusing on teamwork, leadership, and decision-making with strengths in being insightful, empathetic, and collaborative, as well as working on improving assertiveness and decisiveness to become a more effective leader. Swathi Anugu’s research interests include data analysis, technology-driven solutions, and team dynamics, having demonstrated strong teamwork and adaptability, evidenced in participating in OMADA activities, where first place was secured through collaboration and strategic thinking. Beyond academics and work, Swathi Anugu is deeply committed to personal and intellectual growth, continuously seeking new opportunities to learn and develop. As a dedicated parent, Swathi Anugu balances personal and professional life while striving to expand knowledge and skills in various domains, always passionate about fostering meaningful connections, embracing challenges, and positively impacting respective fields. https://orcid.org/0009-0007-5514-6858
Know More

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