Impact of Healthy Organisational Culture on Employee Retention in Malaysia: Mediated by Leadership Styles

Lim, Wai Ping (2023) Impact of Healthy Organisational Culture on Employee Retention in Malaysia: Mediated by Leadership Styles. Masters thesis, Tunku Abdul Rahman University of Management and Technology.

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Abstract

The principles of sound corporate governance are required in the organisations to achieve business sustainability (Dasuki and Lestari, 2019). Recently, maintaining sound corporate governance is one of the mainstream issues of concern in organisations. Even under the strict governance of the governing bodies, the cases of corporate scandals are still increasing continuously, especially the exposure of accounting fraud and corporate scandals that were committed by managers of the organisation that disappointed the stakeholders (Salin, Ab Manan, Kamaluddin and Nawawi, 2017). Specifically, this research examines the impact of healthy organisational culture (Clan, Adhocracy, Hierarchy and Market Culture) and leadership styles on employee retention. A total collection of 230 employees’ data was collected who were working in either public or private companies in Malaysia for the purpose of answering the research objectives. The collected data was further analysed using statistical tools of Statistical Package for theSocial Sciences (SPSS) and Partial Least Squares Path Modeling Method withSmart- PLS. The results revealed that healthy organisational culture like clan and adhocracy culture are positively related to employee retention while hierarchy culture is negatively related to employee retention. Interestingly, market culture that is competitive and result-oriented can be positively related to employee retention. Besides, this research contributes to the literature of employee retention by providing initial evidence on the mediation role of leadership styles as an antecedent towards organisational employee retention. V From a practical perspectives, this research demonstrates further insights by evincing the importance of healthy organisational culture promotes job satisfaction and employee retention, adoption of Competing Value Framework in identifying and categorising the culture to help leaders in better understanding the beliefs and values in each culture and how it will impact on the employee retention, identifying the leadership styles that work best in different contexts and situations with the integration of organisational culture.