The linkages among leadership, trust, and business ethics

Purpose - This study aims to endeavor to bridge a gap in literature by examining the three constructs – leadership, organizational trust, and degree of unethical behavior in conjunction through the data from consumer goods firms in Vietnam. Design/methodology/approach - From the responses by 214 pairs of sales directors and sales managers to self‐administered structured questionnaires, data were collated and processed through analysis of variance and structural equation model to test the research hypotheses. Findings - The findings revealed that transactional leadership is correlated with calculus‐based trust. Transformational leadership, on the other hand, shapes identity‐ and knowledge‐based trust, which are correlated with less degree of unethical behavior. Calculus‐based trust, by contrast, is associated with greater degree of unethical behavior. A direct bridge between transformational leadership and less degree of unethical behavior is also detected. Originality/value - The research offers insight into the linkage pattern of leadership, organizational trust, and degree of unethical behavior that could be applied in other industries and other geographic markets. The value of this research resides in its significance to practitioners that ethical behaviors can be cultivated by transformational leadership and identity‐based trust or knowledge‐based trust, the former of which can be trained to contribute to the development of the latter.