Effect of competitive psychological climate on unethical pro-team behavior: The role of perceived insider status and transformational leadership

Abstract

Summary The purpose of this study is to explain why employees in financial companies in Sri Lanka are likely to engage in unethical pro-team behaviors and how transformational leaders involve controlling unethical pro-team behaviors in a competitive work environment. The study employed a quantitative approach to investigate the association between the competitive psychological climate and perceived insider status on unethical pro-team behaviors. The authors collected data from 426 sales representatives at a finance company in Sri Lanka and tested hypotheses using Structural Equation Modelling analyses through Smart PLS version 3. The results indicate that competitive psychological climate and perceived insider status are positively associated with unethical pro-team behaviors. Further, the transformational leadership’s moderation is negatively significant on the relationship between competitive psychological climate and unethical pro-team behaviors. The study has shown that the leader will delegate more responsibility to the employee, associated with increased employee empowerment and high-quality, ethical behaviors. Besides, it contributes to the literature as of the new theoretical base and offers practical implications with the richer view of a nomological link between the leader, competitive employee, and competitive work environment.