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South Asian Journal of Global Business Research Assessing organizational ethics and career satisfaction through career commitment Avinash D. Pathardikar Sangeeta Sahu Neeraj Kumar Jaiswal

Article information: To cite this document: Avinash D. Pathardikar Sangeeta Sahu Neeraj Kumar Jaiswal , (2016)," Assessing organizational ethics and career satisfaction through career commitment ", South Asian Journal of Global Business Research, Vol. 5 Iss 1 pp. 104 - 124 Permanent link to this document: http://dx.doi.org/10.1108/SAJGBR-02-2015-0017

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Assessing organizational ethics and career satisfaction through

career commitment Avinash D. Pathardikar and Sangeeta Sahu

Department of Human Resource Development, VBS Purvanchal University, Jaunpur, India, and

Neeraj Kumar Jaiswal Department of Management Studies,

Indian Institute of Technology, Roorkee, India

Abstract Purpose – The purpose of this paper is to investigate the relationship between an employee’s beliefs about organizational ethics, career commitment (CC), affective commitment (AC) and career satisfaction (CS). The model expands the earlier work commitment models with CS as the outcome variable. Design/methodology/approach – Subjects were drawn from a 2014 survey of frontline and middle level executives from the insurance sector in India using a structured questionnaire from six Indian insurance companies, 252 were analyzed with structural equation modeling. Findings – The results indicate that executive perceptions about organizational ethics are important for both commitment and satisfaction. Ethical practices at work have a positive outcome on CC, AC and CS. The role of career commitment as a mediator in the relationship between ethics, AC and CS is evident. Research limitations/implications – It is a cross-section study restricted to a single group with similar demographic characteristics. Hence, generalizability of the findings need further research among different groups. Common method variance is addressed using Harman single factor test. Practical/implications – By working out ethical practices in the organization and developing a culture with clarity in business policies and financial constraints to stakeholders, the organizations can win employee commitment and satisfaction. Originality/value – The theoretical contribution of this paper lies in its inclusive approach encompassing the ethical belief of individual with commitment and CS. It differs from earlier studies that have shown the influence of protestant work ethic on commitment. It highlights the similarities and differences between several work commitment models developed in a western context, and the model that we have developed in the Indian context. Keywords India, Ethics, Career satisfaction, Affective commitment, Career commitment, Work commitment models Paper type Research paper

1. Introduction Work commitment research in past two decades examined various models with protestant work ethic (PWE), job involvement, career commitment (CC) and affective commitment (AC) (Randall and Cote, 1991; Morrow, 1993; Cohen, 1999); followed by reconstruction of these models (Freund and Carmeli, 2003). They examined relation of PWE on different forms of commitment. PWE emphasizes on individual belief to work hard. The other dimension crucial to understand influence of ethics neglected by these models is ethical dilemma faced by a person when they find it difficult to make a compromise over values (Fisher and Lovell, 2000; Fisher et al., 2001). Further, persisting dilemma can degenerate into ethical cynicism. Empirical investigations

South Asian Journal of Global Business Research Vol. 5 No. 1, 2016 pp. 104-124 © Emerald Group Publishing Limited 2045-4457 DOI 10.1108/SAJGBR-02-2015-0017

Received 7 February 2015 Revised 3 May 2015 31 August 2015 5 December 2015 Accepted 11 December 2015

The current issue and full text archive of this journal is available on Emerald Insight at: www.emeraldinsight.com/2045-4457.htm

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among Indian managers have explored conflict between their espoused values and their values in practice (Fisher et al., 2001). This lack of congruence is assumed to influence employee commitment and satisfaction (Seong et al., 2012; Loi and Ngo, 2010; Peterson, 2003).

In the field of human resource development (HRD), CC and satisfaction are frequently used variables to study attrition (Kidd and Green, 2006; Mau et al., 2008; Wheeler et al., 2007). Although there are diverse studies exploring the predictors of job satisfaction (Westover and Taylor, 2010; Wickramasinghe, 2009); but few examine career satisfaction (CS) ( Joo and Park, 2010; Barnett and Bradley, 2007). CS is assessed as a success defined by the individual’s satisfaction with work related outcomes or achievements from work experience (Seibert et al., 1999, p. 417). Significant predictors of CS include goal orientation, organizational learning and development feedback ( Joo and Park, 2010); CC (Poon, 2004); proactive personality (Barnett and Bradley, 2007); and diversity training (Yap et al., 2010). Little research has been conducted, focusing on ethics as an aspect influencing CS. Callanan (2003) in his discourse on ways for individuals’ strategy to manage their careers and compromise with personal integrity illustrated the case of Enron Corporation and some other organizations of US. The executives and lower level managers kept silent about the company’s illegal and financially questionable activities out of concern for their career success. Therefore, he suggested need for empirical assessment of the consequences of unethical behaviors of employees on individual career.

Ethical beliefs of an individual on decision making in a situation is influenced by individual demography and organizational context that includes referent groups, rewards and sanctions, codes of conduct, type of ethical conflict, organization effects, industry and business competitiveness (Ford and Richardson, 1994). Majority of studies relating ethics to individual outcomes has been in the context of developed economies (Ambrose et al., 2008; Cohen, 1999; Freund and Carmeli, 2003; Morrow, 1993; Randall and Cote, 1991). To understand the perception of employees on ethics guiding their attitude and behavior in Indian organizations especially in Insurance sector calls for this study.

India’s economy witnessed a growth of 4.7 percent during 2013-2014, service sector including insurance mainly contributed to it. The future of insurance sector is bright in India due to growing population, increase in working class and life expectancy of its people. An increase of 9.23 percent in life insurance was registered during the period (IRDA, 2013-2014). According to the report there are 53 insurance organizations working in India.

The recent ratification of Insurance bill by Indian parliament increasing the cap for foreign direct investment in the sector from 26 to 49 percent and raised penalties between 10 to 12.5 million (Government of India, 2014). It is assumed that such provisions increase the opportunity for global insurance organizations to enter Indian market and opens avenues for employment on the other hand safeguards consumer welfare by levying higher penalties against mis-selling, misinterpretation by agents or companies. At this juncture, a research to focus on the factors influencing individual career discussed keeping in view the problems encountered by the employees is of much relevance to the Industry for recruiting and sustaining employees.

The purpose of this research is to investigate the impact of individual’s personal beliefs about ethical conflict on their CC, AC and CS. The theoretical contribution of this study lies in its approach to understand the dynamics of individual perception between personal ethics and perceived organization interests. Another contribution is that it

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links individual attitude research with career research and builds further knowledge on factors influencing CS. The research question of this study was:

RQ1. What is the relationship between individual belief about supporting and protecting company interests with CC, AC and CS?

This paper begins with a discussion of a conceptual framework and literature review of work commitment, CS and ethical beliefs. The review is used to identify three hypotheses about individual belief of ethics, commitment and CS. Then research methods including data collection and measures are described. The next part summarizes the research findings, based on structural equation modeling (SEM), followed by implication of the results. Finally the limitations and future avenues for research are discussed.

2. Theoretical background 2.1 Work commitments and CS The contemporary business environment provides plenty of opportunity for employment and career changes (Baruch, 2006). Stiff competition in the insurance market has resulted in a tough working environment and redefining of the psychological contract between individual and employer. These changes have increased attrition among employees (Islam, 2011). Mobley et al. (1979) proposed four important antecedents of employee turnover: personal factors, job satisfaction, working environment and intention to leave. CS and organization commitment are major determinants of turnover ( Joo and Park, 2010). CS is assessed as subjective career success, defined as positive psychological or work-related outcomes accumulated by an employee as a result of work experiences ( Judge et al., 1995). Various element influence CS among employees, including personal and organizational factors (Mathieu and Zajac, 1990; Srikanth and Israel, 2012).

Many studies on CS have focused on leadership, organizational climate, organizational commitment, learning, goal orientation and personal characteristics (Mathieu and Zajac, 1990; Joo and Park, 2010; Srikanth and Israel, 2012). Research examining models of work commitment and work outcomes has shown a relationship with employee withdrawal intentions (Carmeli and Gefen, 2005). CS and organization commitment were found to be negatively related with intention to leave ( Joo and Park, 2010). Therefore, we included the factors that would contribute to CS. The work commitment model conceptualized by Morrow in 1983, and empirically tested in 1993 (Morrow, 1983, 1993) includes Protestant work ethic, CC, continuance organizational commitment and affective organizational commitment as factors influencing job involvement as shown in Figure 1. It has been followed by studies from Randall and Cote (1991), Cohen (1999), and Freund and Carmeli (2003).

Morrow (1983) conceptualized one of the earliest models explaining the five main commitments that influence work: protestant work ethic, CC, continuance commitment, AC and job involvement. It shows that commitments have reciprocal relations among themselves (Morrow, 1993). He suggested that an individual arrives at the organization with defined levels of protestant work ethic and CC, which are not necessarily influenced by the organization. CC influences continuance and AC leading to job involvement.

Randall and Cote (1991) placed Protestant work ethic as the most basic and permanent with the lowest ability to change (Furnham, 1990), reasoning that AC, continuance commitment and CC change relatively fast. A high Protestant work ethic

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influenced job involvement resulting in a high commitment from the individual to his/her job. Another model showed the effect of protestant work ethics on job involvement leading to commitment (Cohen, 1999). In the reconstructed model of Freund and Carmeli (2003), Protestant work ethic is the base variable, and the influence of CC was seen only on continuance commitment. Our research worked on the lines of Morrows’ model and moved a step further to examine the influence of ethical beliefs and commitment on CS. Instead of protestant work ethic, in present study individual belief on organizational ethics was included to demonstrate how the ethical decision of an individual to support the unethical practices influence commitment and satisfaction.

In light of the emerging career concepts influenced by varied employment relations in the globalized business environment, a change in career patterns has been observed (Sullivan and Baruch, 2009). Individuals evaluate the options available, then choose from opportunities and work demands affecting the outcome of their career pattern, often referred to as the kaleidoscope approach. In spite of different frameworks to explain career pattern, CS is the main outcome for employees. This paper analyzes the influence of factors personal to the employee on CS. It also addresses the need to understand the effect of cultural and national differences on career and commitment models as most of the past studies are based on samples from western countries.

2.2 Ethical belief, commitment and CS We consider individual belief about organization ethics as the basic variable whose characteristics are inherent to the individual. To find answers to the problem raised at the beginning of this paper, the extent to which employees accept and support behaviors in an organization that may conflict with ethical norms was taken as a personal factor in the study. Past studies have highlighted a positive relation between employee lack of acceptance of ethically dubious behavior and the difficulty of gaining individual benefit within that organization (Mudrack et al., 1999). The contextual factor “Individual belief about organizational ethics” assesses the extent to which employees accept and support behavior within an organization that may conflict with their personal ethical norms (Froelich and Kottke, 1991). They conducted factor analysis on a 16 item survey from 225 employed people culminates into two factors. The first was a general factor “company support” and the second was “lie to protect the company” factor. The scale later reduced to ten items by them, represented employee beliefs about ethical behavior to be used in organizational settings to identify potential ethical conflicts. In pursuing their career ambitions, employees reported experiencing pressure to conform to the perceived lower

Career commitment

Protestant Work Ethic

Affective organizational commitment

Job involvement

Continuance organizational commitment

Source: Morrow (1993)

Figure 1. Morrow’s model

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ethical standards of the organization to achieve organizational goals. Individuals experiencing such ethical conflict usually withdraw from the organization (Shafer, 2002; Peterson, 2003). A strong positive relationship between perceived behavioral integrity of managers and the employee attitudes of satisfaction and commitment was detected in a meta analysis (Davis and Rothstein, 2006).

The complex relation between ethical beliefs and employee attitude can be explained through the degree to which the individual believes that ethics are relative (Akaah, 1997). The moral philosophy of individuals varied along the continuum from a strong belief in universal moral rules to a belief that being ethical is relative to the situation (Forsyth, 1980). Thus, some individuals believe that certain acts (e.g. Say lie to protect the company) is universally wrong; whereas, some accept or support these acts as their behavior depends on situation and outcome. The ethical orientation of the individual influences the ethical reasoning process that comprises of four components; the identification of an ethical dilemma, developing an ideal solution, formulating an intention to act and ethical action (Rest, 1994).

It has been proposed that employees adhering strongly to a belief in universal moral values will be in an ethical dilemma when confronted with a situation of unethical acts such as deceiving a customer to maximize organization profit or support supervisors’ incorrect viewpoint. Due to cognitive dissonance caused by difference in ethical belief and the demand of situation, an individual feels the pressure culminating in distress leading to poor commitment and satisfaction (Festinger, 1942; Ones and Viswesvaran, 1998; Schwepker, 1999). In order to reduce dissonance or in other words in desire of consistency between ethical beliefs and ethical climate of their organization, individual may decide to leave the organization or change their profession. On the contrary, the relativists may adapt to the situation by fitting their ethical beliefs with the organization goals.

Studies on insurance market in the African continent shows that unethical practices in the insurance industry has been leading to loss of confidence among customers, poor insurance patronage, and stunted growth for insurance industry (Isimoya, 2014). Research in Singapore, USA and some other countries show influence of ethical climate on CS and job satisfaction (Koh and Boo, 2004; Sims and Kroeck, 1994; Valentine and Fleischman, 2008; Ulrich et al., 2007). The ethical belief of the individual often influences their organizational commitment (Peterson, 2003) and has been observed to be associated with career success, job satisfaction (Koh and Boo, 2004). Meyer and Allen (1991) conceptualized commitment as a psychological state with affective (desire), continuance (need) and normative (obligation) commitment. A strong relationship is seen between ethical climate and AC (Cullen et al., 2003; Erben and Guneser, 2008). The congruence between person and organization is vital to commitment and loyalty (Seong et al., 2012). This ethical fit between employee and organization influenced AC (Sims and Kroeck, 1994). Another empirical study among employees in American private organization shows a positive effect of protestant work ethic endorsement with greater need for achievement on their commitment toward career (Goulet and Singh, 2002). Therefore, in explaining the work commitment model, we assume that ethical belief of the employee influences AC and CC. Hence, we propose:

H1a. Individuals’ belief about organization ethics of an employee positively influences AC toward the organization.

H1b. Individuals’ belief about organization ethics of an employee positively influences CC toward the organization.

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This study focuses on affective organizational commitment, defined as “the employee’s emotional attachment to, identification with and involvement in the organization. Employees with a strong AC continue employment with the organization because they want to do so” (Meyer and Allen, 1991, p. 67). A strong positive correlation between occupational commitment and AC as shown by Meyer and his associates (2002) was the reason for including only AC in the model. It is also supported by some studies that suggested the use of AC as a single measure of organizational commitment (Feather and Rauter, 2004; Lee and Bruvold, 2003). A study among hotel managers in Turkey showed a significant effect of job satisfaction on AC, but no relationship with continuance commitment (Gunlu et al., 2010). Continuance commitment is based on the cost calculation and benefits that an individual gets from a particular organization. This makes it more of a hygiene factor, according to Herzberg’s (1987) theory, rather than contributing toward satisfaction. It was a part of previous work commitment models, but in this study, with CS being the outcome variable, continuance commitment was not included in the model.

A variation in direction of relationship between AC and CC is observed in past studies. Morrow’s (1993) and Cohen’s (1999) model shows that CC leads to AC, implying that a person highly committed to career objectives develops emotional attachment toward the organization after the goals get fulfilled or gets an opportunity to accomplish the career objectives. In other studies, AC and CC appear as outcome variables to protestant work ethics, mediated by job involvement (Randall and Cote, 1991; Freund and Carmeli, 2003). Also, there are studies that show no significant relationship with CC (Kidd and Green, 2006). In this study, we assume that:

H2. CC of an employee will positively influence AC toward the organization.

Individuals generally become more attached to the organization when they are given the opportunity to manage their own careers (Chew and Chan, 2008; Jongseok et al., 2009). A positive influence of CC on CS was observed in a study from Malaysia (Poon, 2004). People who are more committed to their career experienced more subjective success in career. Those highly committed toward their career will likely set higher career goals for themselves. This leads to better performance and the intrinsic reward results in form of CS. Managers and non-managers surveyed in Lebanon show that CC predicted career success (Ballout, 2009). Hence:

H3. CC of an employee will be positively related to his/her CS (Figure 2).

IBOE Career Commitment

H1a

H1b

H2

H3

Affective Commitment

Career Satisfaction

Figure 2. Hypothesized model

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3. Methods 3.1 Participants and procedures Six Indian insurance companies located in the eastern part of the Indian subcontinent were selected for this study. The selected companies primarily dealt with life insurance. Purposive sampling method was adopted. In total, 50 middle level executives involved in sales promotion of each sample organization were considered. Overall 300 executives initially included in the study. The survey was conducted in 2014. In total, 267 respondents returned the questionnaires (a response rate of 89 percent). In total, 252 questionnaires were used for further analysis as some questionnaires were incomplete; we also eliminated outliers from the study. A large majority of respondents were male (93.3 percent) and between 22 and 40 years of age (79.8 percent, mean ¼ 35.30, SD ¼ 6.54) with their average level of experience 8.488 years (SD ¼ 5.408).

SEM is the large sample technique and analysis of complex model generally requires more cases than that of simpler model. Most researcher recommend using sample sizes of at least 200 or 10 cases per parameters (Kline, 2011, p. 11). In this study total 24 parameters were estimated. Thus 252 questionnaires are sufficient for conducting SEM.

Initial screening of the data was performed by preparing a box plot to find outliers. The eliminated questionnaires were beyond the three-box length.

3.2 Measures A four section questionnaire was administered. It included a statement of the purpose of the study and an assurance of complete anonymity for individual responses and that they would only be used in statistical form. Except for personal demographic data (e.g. age, gender, experience, qualification and marital status), all measures employed a five-point Likert scale from strongly agree ¼ 5 to strongly disagree ¼ 1.

Individual beliefs about organizational ethics (IBOE). A ten-item IBOE scale (Froelich and Kottke, 1991) was used to assess the extent to which employees accept and support behavior within an organization that may conflict with their own ethical norms. The measure contains two dimensions. The first is called “support for the company,” and consists of six items. It assesses the extent to which an employee disagrees with actions such as companies engaging in shady business practices to beat their competition or asking employees to falsify a document. Items included “It is okay for a supervisor to ask an employee to support someone else’s incorrect viewpoint.” The second dimension is called “protecting the company,” and comprises four items. It assesses the extent to which it is unacceptable for an employee to lie to a customer, supervisor or a co-worker to protect the company. Items include “An employee may need to lie to a co-worker to protect the company.” The measure has also been used as a single composite indicator of employee lack of acceptance of ethically dubious behavior that benefits the company (Mudrack et al., 1999). The coefficient of α for the IBOE dimension was 0.94, which was sound in comparison to the value of 0.82 reported by Froelich and Kottke (1991).

CC. A seven-item scale (Blau, 1989) was adopted to assess CC. This tool is used to examine an individual’s commitment toward his occupation, profession and career. A sample item is: “I definitely want a career for myself in this profession.” The coefficient of α of 0.81 in this study (see Table I) was comparable to the range of 0.76 to 0.88 previously reported (Reilly and Orsak, 1991; Somers and Birnbaum, 1998; Cohen, 1999).

AC. A six-item scale (Meyer and Allen, 1997) was used to assess AC. This factor measures an employee’s emotional attachment to, identification with, and involvement

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in the organization. A sample item is: “I really feel as if this organization’s problems are my own.” The coefficient of α of 0.86 in this study (see Table I) was comparable to 0.88, an α value reported by Meyer and Allen (1997).

CS. A five-item scale (Greenhaus et al., 1990) was adopted to assess the individual’s satisfaction with career success, an internally generated and defined career outcome. A sample item is “I am satisfied with the success I have achieved in my career.” The coefficient of α of 0.80 in this study (see Table I) was comparable to the range of 0.83 to 0.89 reported previously (Aryee et al., 1994; Greenhaus et al., 1990).

The items of all the constructs were further arranged in parcels separately and taken as indicator of latent variable in the model (Hall et al., 1999). The items of IBOE were grouped in three parcels; and each of the latent variable AC, CC and CS were grouped in two parcels and used as indicators in the model.

4. Data analysis and results A two-step procedure (Anderson and Gerbing, 1988; Medsker et al., 1994) was adopted to test the hypotheses. The first step tested whether the self-report measures used in the study were all separate and distinct. In the second step, a structured model was analyzed that specified the nature of the hypothesized relationships among the construct. Different fit indices were chosen to assess the fit of structural model: the goodness-of-fit index (GFI), comparative fit index (CFI), increment fit index (IFI), normed fit index (NFI) and root mean square error of approximation (RMSEA) (Bentler, 1990; Bentler and Bonett, 1980; Joreskog and Sorbom, 1989)

Table I gives primary data relating to the nature of the scales as they were combined for further analysis. It is evident that mean and standard deviations of the Likert-scale variables were reasonably high, ranging from 4.78 to 3.43 and 1.12 to 1.90. The reliability of the measures was good, ranging from 0.80 to 0.94, giving us justification for further analysis. The correlation coefficients are range from 0.34 to 0.60 ( po0.01) among the variables taken in the study. Correlation more than 0.70 between the variables raises the question of multicollinearity between them (Tabachnick and Fidell, 2001). In this case no such condition occurs (see Table I).

Cronbach’s α is obtained under the assumption of parallelity i.e. all factor loadings and all error variances are constrained to be equal. This Cronbach’s α may over or underestimate reliability (Raykov, 1998). To overcome issues of reliability and validity of constructs composite reliability (CR) and average variance extracted (AVE) were calculated. CR assesses the internal consistency of the measure and AVE represents the ratio of total variance that is due to the latent variable. A variance extracted 0.50

Sl. Variable Mean SD CR AVE 1 2 3 4 5 6

1 Age 35.30 6.54 2 Experience 8.48 5.40 0.89** 3 IBOE 3.43 1.90 0.96 0.89 −0.45** −0.43** (0.94) 4 Career Commitment 4.16 1.39 0.86 0.76 0.42** 0.41** −0.57** (0.81) 5 Affective

commitment 4.75 1.12 0.88 0.79 0.48** 0.43** −0.58** 0.60** (0.86) 6 Career Satisfaction 4.78 1.53 0.82 0.70 0.47** 0.44** −0.34** 0.54** 0.54** (0.80) Notes: n ¼ 252. Values given in the parenthesis are α reliability coefficients; CR ¼ composite reliability; AVE, average variance extracted. **po0.01

Table I. Descriptive statistics, coefficients of α, and

correlations

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indicates that the validity of both the constructs and individual variable is high (Dillon and Goldstein, 1984). The constructs have sound reliability and validity as CR is greater than 0.70 and AVE is greater than 0.50 in the model. Further, CR is greater than AVE that proves the constructs have sound discriminant validity (Hair et al., 1998).

Using analysis of moment structures (AMOS), confirmatory factor analysis (CFA) was performed to determine the distinctness of the different constructs used in the study. From the values obtained after CFA ( χ2 ¼ 46.274, df ¼ 21 ( χ2/df ¼ 2.204); GFI ¼ 0.962; NFI ¼ 0.975; IFI ¼ 0.986; TLI ¼ 0.976; CFI ¼ 0.986; RMSEA ¼ 0.069) it can be concluded that all the four variables Individual belief about organizational ethics, AC, CC and CS are distinct from each other and can be taken for further analysis for modeling.

After CFA, SEM was conducted (see Table II) including all four variables. SEM analysis clearly indicated the superiority of Model-3, ( χ2 ¼ 46.274 df ¼ 21); GFI ¼ 0.962; NFI ¼ 0.975; IFI ¼ 0.986; TLI ¼ 0.976; CFI ¼ 0.986; RMSEA ¼ 0.069) in which Individual belief about organizational ethics was taken as exogenous variable and predicted CC (directly), AC (directly and indirectly) and CS (directly and indirectly). The χ2/df ratio should be less than 3; the values of GFI, IFI, CFI, NFI greater than 0.90; and RMSEA less than 0.08. For RMSEA, values of 0.05 or less indicate close fit, values between 0.05 and 0.08 indicate reasonable fit and values between 0.08 and 0.10 indicate marginal fit ( Joreskog and Sorbom, 1993; Kline, 1998; Browne and Cudeck, 1992).

Initially, hypothesized Model-1 (see Table II) suggested that CC fully mediated the relationship between Individual belief about organizational ethics/AC and CS. However, to test this hypothesis, it was essential to consider other alternative models. Against the hypothesized Model-1, two alternative models (Models-2 and 3) were tested that required an additional four sets of construct relationships. In the hypothesized Model-1, Individual belief about organizational ethics is taken as exogenous variable and proposed as direct predictor of CC and AC and predicting AC and CS through CC. Model-2 is similar to Model-1 but with addition of a direct path from Individual belief about organizational ethics to CS. Finally, in Model-3 an additional path in from AC to CS was drawn in the Model-2 that given the significant results. A comparison of structural models is set out in Table II and the parameter estimates for structural relationships (unstandardized, standardized, direct, indirect and total effects) are reported in Table III. The relevant SEM results are shown in Figure 3.

As shown in Table II, significant changes in the χ2 values ( po0.01) were associated with all alternative models. However, the best fit for the data was the last nested model, Model-3. A summary of various results are given in Tables II and III.

Models χ2 Df GFI NFI IFI TLI CFI RMSEA

Model 1: IBOE → CC → AC; IBOE → CC → CS and IBOE →AC (Hypothesized) 70.321*** 23 0.944 0.963 0.975 0.960 0.975 0.091 Model 2: IBOE → CC → AC; IBOE → CC → CS; IBOE → AC and IBOE → CS 69.777*** 22 0.945 0.963 0.975 0.958 0.974 0.093 Model 3: IBOE → CC → AC → CS; IBOE → CC → CS; IBOE → AC and IBOE → CS (Confirmed) 46.274*** 21 0.962 0.975 0.986 0.976 0.986 0.069 Notes: IBOE, individual belief about organizational ethics; AC, affective commitment; CC, career commitment; CS, career satisfaction. ***po0.001

Table II. Comparison of alternative models

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As shown in Figure 3, Individual belief about organizational ethics explained 38.5 percent variance in CC, whereas, Individual belief about organizational ethics and CC contributed toward explaining 54.1 percent of variance in AC in the confirmed model. All the predicting variables (IBOE, CC and AC) explained the variance 50.5 percent in CS. In social research, this is a very significant relationship with such a high percentage of variance being explained by an outcome variable in the study (Stine and Foster, 2011).

IBOE CC AC

Standardized total effects CC −0.621 (B ¼ −0.419***) 0.000 0.000 AC −0.617 0.511 (B ¼ 0.503***) 0.000 CS −0.383 0.646 0.470

Standardized direct effects CC −0.621 0.000 0.000 AC −0.299 (B ¼ −0.199***) 0.511 0.000 CS 0.158 (B ¼ 0.074*) 0.406 (B ¼ 0.282***) 0.470 (B ¼ 0.332***)

Standardized indirect effects CC 0.000 0.000 0.000 AC −0.317 0.000 0.000 CS −0.542 0.240 0.000

R2 ¼ 0.385 CC←IBOE R2 ¼ 0.541 AC←CC←IBOE; AC←IBOE R2 ¼ 0.505 CS←AC← CC ←IBOE; CS← AC← IBOE; CS← CC← IBOE; CS← IBOE Notes: χ2 ¼ 46.274, df ¼ 21( χ2/df ¼ 2.204); GFI ¼ 0.962; NFI ¼ 0.975; IFI ¼ 0.986; TLI ¼ 0.976; CFI ¼ 0.986; RMSEA ¼ 0.069). IBOE, individual belief about organizational ethics; CC, career commitment; AC, affective commitment; CS, career satisfaction; Values given in the parenthesis are unstandardized estimates (B)between the constructs. *po0.05, ***po0.001

Table III. Parameter estimates

for the confirmed model

e7e6

e10

CrC1 Ethics3Ethics2Ethics1 CrC2

CrS1 CrS2

e11

e12

AfC1 Afc2

Affective Commitment

Career Satisfaction

Career Commitment

IBOE

0.85

0.92

0.54

0.51 0.39

–0.30

0.47

0.50

0.410.87

0.75

0.75

0.56

0.91

0.83

0.76 0.87

0.93

0.88

0.94 0.87

–0.62

0.96

0.91 0.16

e4

e9 e8

e5 e3 e2 e1

0.86

0.73

Figure 3. Model confirmed

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The effect of Individual beliefs about organizational ethics on CC and AC are negative because the pattern of statements measuring beliefs about organizational ethics show disagreement of employees with unethical actions and their unacceptability of dubious actions to protect the company.

Individual beliefs about organizational ethics show a significant relationship with AC ( β ¼ −0.617). Hence, H1a (IBOE→AC; IBOE→CC→AC) is accepted and also H1b (IBOE→CC) is supported ( β ¼ 0.621). The standardized direct effect of Individual beliefs about organizational ethics on all the endogenous variables (AC, CC and CS) is significant with the standardized weights; −0.621; −0.299 and 0.158, respectively. Variable CC directly influences AC ( β ¼ 0.511) supported H2 in the model. Finally, CC significantly predicted CS directly and through AC (CC→CS; CC→AC→CS) ( β ¼ 0.404; β ¼ 0.240) supports the H3 in the proposed model. In addition to the hypothesized model two more path were added and identified in the confirmed model. Individual belief about organizational ethics was regressed directly on CS ( β ¼ 0.158) and AC was regressed on CS ( β ¼ 0.470) and significant standardized indirect effect was observed.

5. Discussion Do ethical beliefs of employees influence their commitment and CS? The results of this study address this question. They show that ethical beliefs have an effect on CS. The indirect relation of IBOE with employee CS is through CC and AC. Individual beliefs on ethics have significant influence on career (H1b) and ACs (H1a). This complements past studies that affirm a strong relationship between them (Peterson, 2003; Ambrose et al., 2008). Some reconstructed models show an indirect relationship between ethics and AC, mainly through CC (Morrow, 1993; Carmeli and Gefen, 2005) as in our findings. In their study on Israeli health care system, it is seen how different forms of work commitment affect each other and serve to influence work behavior and outcomes. The relations in our model (IBOE to CC ¼ −0.61, po0.001; CC to AC ¼ 0.52, po0.001) were stronger than Morrow’s model (protestant work ethic to CC ¼ −0.03, po0.05; CC to AC ¼ 0.29, po0.05). Hence, our argument that organization ethics to support or protect the company better explained the issues being faced by insurance employees in contemporary situation is well supported.

We predicted that CC of an employee will positively influence their AC toward the organization. Our results supported the prediction (H2). The impact of CC on CS was also seen (H3). Some other studies examined the moderating effect of CC on the relation between HR practices and AC (Mohamed et al., 2006). It displays relation of perceived organization values with AC in a study conducted in USA. Another study in Korea shows moderating role of CC on relationships between employees’ perception of company practices and organizational commitment (Chang, 1999). Our results diverge from findings of a study among white-collar employees from diverse occupations and organizations in Malaysia. It shows that CC predicts only objective career success (salary) but not subjective career success (CS) through emotions (Poon, 2004). Furthermore, no significant relation between affective and career work commitment was seen among research scientists who shoulder managerial responsibilities in UK (Kidd and Green, 2006).

The results of the study are complemented by finding of a quantitative research on Indian accounts and financial managers (Fisher et al., 2001). It shows that when faced with hard decisions, they expressed a conflict between ethical puzzle and ethical awareness, whereas, in such circumstances western managers remained ethical neutral. This indicates toward a conflict experienced by Indian managers between their

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espoused values and their values in practice. Present study further examines the manifestation of ethics in form of commitment and CS.

An understanding of ethical behavior can be determined at individual level through locus of control (Rotter, 1966). Researchers have argued that when faced with a moral situation, internals are in control of the situation and assume personal responsibility for outcomes (O’ Fallon and Butterfield, 2005). Studies show that internal control is positively associated with favorable work outcomes (Ng et al., 2006). Thus, we contend that ethical decision of supporting or not involving in the unfair practices influence employees’ attitudes that are internally regulated, such as CC and AC. It is realized in the results that variance explained by organizational ethics on AC (R2 affective) is more than that of CC (R2 career) (R2 affective ¼ 38.5 percent; R2 career ¼ 54.1 percent). In combination both of these work commitments effect CS and explain 50.5 percent of variance. This finding is supported by some past studies (Duffy et al., 2011). Their study observes that CC fully mediates the calling-job satisfaction relation and partially mediates calling-organization commitment relation.

Above discourse indicates variation in portrayal of CC in explaining its relationship with AC. The reason may be attributed to cultural differences across national boundaries and globalization. Discrete researches propose differences in career attitude due to cultural differences (Sullivan and Arthur, 2006). Results from study of Malaysian managers reflect a shift from collectivism toward individualism with Malaysia’s economic development (Noordin et al., 2002). CC was observed to be higher in individualistic than collectivist culture. Inquiry in Indian context suggests collectivism being predominant culture among Indians influencing career choice among them (Agarwala, 2008). Though discussion also signal toward a mix of collectivist and individualistic behavior as an outcome of conflict in compelling urgent personal needs and goals triggered by globalization (Sinha et al., 2001). This shift in cultural dimensions is bound to impact the career attitude of people.

Furthermore, South Asia is one of the fastest growing regions in the world (Khilji, 2012). Globalization lead to shift in career patterns as observed in different parts of the world (Biemann et al., 2011; Tams and Arthur, 2007; Shah, 2009). Management and culture at workplaces have been constantly shaped by globalization in terms of attitudes, rituals and behavior (Fang, 2010). Managers often try to balance tradition with global demands changing their behavior (Khilji, 2004). Past findings show Indian managers are more influenced by market culture and economy (Chatterjee and Pearson, 2000). Therefore, changes triggered by globalization and shift in culture have contributed to anomaly in results of studies on work commitment in different organization and national context. The avenue of cultural impact on the emerged model can be studied by researchers.

The extent to which employees accept and support behaviors in the organization that may conflict with their own ethical norms influences their commitment toward their careers. To achieve their targets and attract customers, employees working in the insurance sector may have to engage in or support unethical business practices such as falsifying documents. At times, they have to lie to a customer, supervisor or coworker to protect the company. Such acts, if unacceptable to the employee, will reduce CS due to cognitive dissonance (Festinger, 1942; Viswesvaran et al., 1998). The person concerned reduces this dissonance by either changing their own values through adjustment and acceptance or removing themselves from the situation, which is often seen in the form of turnover. The outcome is consistent with previous studies demonstrating a relationship between organizational ethics, job satisfaction,

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and career success (Koh and Boo, 2004). Financial collapses of high profile corporations in the U.S. and other countries have led theorists to understand ethical lapses and career success (Callanan, 2003; Labaton, 2002). The relationship between them is evident in this study.

In the process of establishing nomological network with ethics, the confirmed model differs from hypothesized one with contribution of IBOE and AC on CS. Work attitude of an individual influences interest in assignment, eventually resulting higher CS (Boies and Rothstein, 2002). Further, significant positive direct effect of IBOE on CS suggests that more the employees accept or support behavior expected from organization, higher is their CS. This can be expounded through an understanding of the elements of CS. The statements used in the tool evaluating CS construe individual success and achievement for progress. It implies that an employee gains by accepting and supporting behavior expected by the organization. This gain or progress is perhaps what the employee dreamt from his career. In such situation the employee agrees to the ethical condition as requirement of the career. A study on physicians displays reducing potential threats of malpractice lawsuits and adequate interaction time with patients increases CS (Deshpande and De Mello, 2010). Accordingly, the CS of insurance people can boost by spending more time with clients or customers and not getting involved in any malpractice or forge activity. Nevertheless, this logic contradicts past studies on agreeableness and CS (Seibert and Kraimer, 2001). Agreeableness was related negatively to CS. Overall, the general consistency between our findings and those of previous research lend credence to the present report that the individual belief of organizational ethics explain significant variance in CS in direct and indirect relation through career and AC.

6. Implications Our study has made a significant theoretical contribution by linking organization ethics, CC, AC and CS, the first study to do so. No previous research has explored the relation of organization ethics and CC on CS. Our study therefore adds a new dimension to the earlier models proposed by Morrow (1983), Randall and Cote (1991) and Cohen (1999), by introducing CS as an outcome variable. It is an interesting finding that ethical practices in the workplace influence individual decisions on career discourse by pointing out how IBOE and AC can influence CS. In addition, this study provides useful information based on the Indian context to researchers for conducting similar studies in different cultural backgrounds. It also helps us to recognize the importance of ethical activity in an organization to support the committed participation of the workforce.

There are several practical implications for HR professionals who develop relevant practices for the purpose of enhancing organizational commitment, managing the careers of employees and reducing attrition. First, use of ethical practices at work significantly influences CS and AC, and ultimately intention to leave (Chang, 2011). Thus, HR can play an important role in enhancing all the sub-constructs of organizational ethics, at both the personal level (i.e. rewarding ethical practices, developing and encouraging assertive behavior, and providing directions for a customer orientation approach) and the structural level (i.e. ethical norms and standards, empowerment, adopting ethical business practices in form of ethical policies that support principled conduct, punishing unethical actions, and encouraging healthy competition by increasing individual perceptions of an ethical company environment), as suggested by some studies (Valentine et al., 2002; Schwepker, 2003). For example, creating an ethical culture in the organization would be reflected in beliefs about the ethics of an organization shared by

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its members (Key, 1999). Consequently, this culture could contribute to fostering organizational commitment (Pathardikar and Sahu, 2011) and CS.

Second, HR professionals could establish an environment free from conflicts generated from lack of congruence between individual beliefs and organizational practices on ethical issues. The analysis indicates that an ethical climate results in lower role conflict and role ambiguity, and raises satisfaction ( Jaramillo et al., 2006). Pressure to engage in unethical activity leads to ethical conflicts, which result in lowering of commitment and increased intention to leave (Sims, 1998; Peterson, 2003; Jaramillo et al., 2006). Even work on the ethical person-organization fit shows a relationship with higher AC (Ambrose et al., 2008), highlighting the relevance of ethical practices for employee behavior. Moreover, organizations need to develop and communicate clear business policies and financial constraints to its stakeholders.

Third, training programs can be developed and used to create and promote an ethical approach, along with an ethical culture to support behavior (Fisher, 2003). This support for ethical behavior would help people in building a career and act as an intrinsic motivator to stay with the organization. Employees can be a critical source of competitive advantage for the organization (Gottschalg and Zollo, 2007). Based on our findings in this study on the relationship between individual belief about organization ethics, AC, CC and CS, HR professionals can develop and implement ethical practices and gain employee confidence and trust toward the organization. It will also help the customers as at micro level, as insurance addresses social problems and contributes largely to the social security system. Therefore, grievances of the customers related to rate cutting and hiding basic facts can be reduced and the organizations can win goodwill and support the social security system of the country in a better way.

7. Limitations and suggestions for future research In terms of methodology, this study has some potential limitations. First, the sample was restricted to a single group with similar demographic characteristics. However, the measures used for the variables are standardized tools, so their outcomes, in the form of the model, make the study more relevant. To justify the limitation of method bias Harman’s single factor test for common method variance was conducted as statistical remedy with the help of SPSS. The result explains maximum variance of 39 on a single factor which is below the limit of 50 percent (Podsakoff et al., 2003). Second, although we found significant results, our model only explains the effect of organizational ethics, CC and AC on CS. The possibility of other factors influencing CC was not included. To solve the above limitations, future research needs to be based on multiple sources, in different cultures and ethical environments. They should examine the experiences of individuals and their impact on CS (Arthur et al., 2005). Cultural issues should be addressed objectively to reveal their direct influence on the work commitment model (Chudzikowski et al., 2009). For generalizability, multi-sample and longitudinal studies with these variables are needed representing diverse demographic cohorts.

8. Conclusion The purpose of this research was to investigate the impact of organizational ethics, AC and CC on employees’ CS, which is a little-researched area. The conclusion of this paper highlights a number of aspects. It adds a different dimension to the earlier models proposed by Morrow (1983), Randall and Cote (1991), and Cohen (1999) and the reconstructed model of Freund and Carmeli (2003). The focus is on CS as an outcome variable. The commitment

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variables bring together individual and organizational dimensions in explaining CS. It appears from both this and previous studies that the interplay of work-related commitments in explaining career phenomena is affected by the type of organization studied, the stage of evolution of globalization in the country, the industrial economy and the culture (Chudzikowski et al., 2009; Dries, 2011). This study provides an additional empirical investigation to validate the influence of multiple commitments on outcome (Freund and Carmeli, 2003).

Our findings illustrate that following ethical practices at work will have a positive outcome on individuals’ CS, and appears to reduce intention to leave. This study was carried out in the insurance sector in India, which has high attrition rate and strong competition among global players. The study indicates the use of ethical activity to support and protect the company, since insurance policies come with lot of terms and conditions and to attract investors; companies may knowingly or unknowingly mislead customers. However, organizations need to be aware of the consequences of unethical practices on their employee turnover.

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About the authors Dr Avinash D. Pathardikar is an Associate Professor and the Head in the Department of Human Resource Development, Faculty of Management Studies, VBS Purvanchal University, Jaunpur (UP), India. He teach Human resource management at post graduate level. His research interests are leadership, occupational stress, organizational culture, commitment and Career satisfaction. Dr Avinash D. Pathardikar is the corresponding author and can be contacted at: [email protected]

Dr Sangeeta Sahu is an Associate Professor in the Department of Human resource development, Faculty of management studies, VBS Purvanchal University, Jaunpur (UP), India. She teaches organizational behavior and human resource management. She has published two books and eight articles in various peer reviewed journals. Her research interest covers competency, commitment, culture, leadership, career and performance drivers.

Neeraj Kumar Jaiswal is a Research Scholar in the department of management Studies, Indian Institute of Technology, Roorkee, India. His research interests are performance management and employee attrition.

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