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Analyzing the Impact of Organizational Trust on Job Engagement: A Mediating Role of Employee Loyalty

Author

Listed:
  • Altanchimeg Zanabazar

    (National University of Mongolia, Mongolia)

  • Tsolmon Jambal

    (Institute of Technology and Business in České Budějovice, Czech Republic)

  • Solongo Natsagdorj

    (National University of Mongolia, Mongolia)

  • Iva Klementová

    (Institute of Technology and Business in České Budějovice, Czech Republic)

Abstract

This research aimed to investigate the mediating role of employee loyalty in the relationship between perceived organizational trust and job engagement. The study utilized data from 268 employees across two private banks in Mongolia and conducted thorough analyses to evaluate the reliability and correlation of the variables via structural equation modelling (SEM). The study revealed that organizational trust had a positive impact on both employee loyalty and job engagement. These findings underscore the critical importance of organizational trust in fostering employee loyalty and promoting increased engagement in one's work. Additionally, the study identified a positive influence of employee loyalty on job engagement, indicating that loyal employees are more likely to be engaged in their roles. The research determined that employee loyalty fully mediated the connection between organizational trust and job engagement. While organizational trust directly affects engagement, its impact is also channelled through enhanced employee loyalty. This highlights the intricate relationship between organizational trust, employee loyalty, and job engagement in the workplace. The results of this study deepen the understanding of organizational trust and have important practical implications for improving employee loyalty and engagement. Specifically, the findings suggest that fostering transparency and open communication between management and employees can increase trust, leading to higher retention rates and greater willingness to go above and beyond job duties.

Suggested Citation

  • Altanchimeg Zanabazar & Tsolmon Jambal & Solongo Natsagdorj & Iva Klementová, 2024. "Analyzing the Impact of Organizational Trust on Job Engagement: A Mediating Role of Employee Loyalty," Entrepreneurship and Sustainability Issues, VsI Entrepreneurship and Sustainability Center, vol. 11(4), pages 105-119, June.
  • Handle: RePEc:ssi:jouesi:v:11:y:2024:i:4:p:105-119
    DOI: 10.9770/jesi.2024.11.4(7)
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    References listed on IDEAS

    as
    1. Ivana Tomic & Zdravko Tesic & Bogdan Kuzmanovic & Milos Tomic, 2018. "An empirical study of employee loyalty, service quality, cost reduction and company performance," Economic Research-Ekonomska Istraživanja, Taylor & Francis Journals, vol. 31(1), pages 827-846, January.
    2. Aamir Chughtai & Marann Byrne & Barbara Flood, 2015. "Linking Ethical Leadership to Employee Well-Being: The Role of Trust in Supervisor," Journal of Business Ethics, Springer, vol. 128(3), pages 653-663, May.
    3. Judit Oláh & Yusmar Ardhi Hidayat & Beata Gavurova & Muhammad Asif Khan & József Popp, 2021. "Trust levels within categories of information and communication technology companies," PLOS ONE, Public Library of Science, vol. 16(6), pages 1-21, June.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    organizational trust; employee loyalty; job engagement; bank employees;
    All these keywords.

    JEL classification:

    • L29 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Other
    • M10 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - General
    • M59 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Other
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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