The Practice of Ethical Leadership and its Impact on Employee Trust in the Private Sector of Timor-Leste

Leaders of organizations in the for-profit private sector play an important role in ensuring the successful execution of complex initiatives and organizational decision-making. This study examines how ethical leadership influences employee trust in Timor-Leste. Ethical leadership emphasizes the leader’s responsibility to act as a role model, thereby gaining the trust and confidence of employees. Leadership lacking ethics and integrity can harm organizational stakeholders, particularly employees. The purpose of this study is to examine the relationship between the ethical practices of private-sector leaders and employees’ level of trust. Ethical Leadership emphasises leadership as something demonstrated through action rather than merely through personal values or identity (Lawton & Gabriunas, 2014). This approach is essential for achieving both profitability in the private sector and the broader economic prosperity of Timor-Leste. Developing mutual trust and employee commitment is an effective way to reinforce trust, cultivate mutual understanding and cooperation, and increase job commitment and job satisfaction, ultimately leading to improved organizational performance. This study used a mixedmethods approach across multiple companies, employing a convergent mixed-methods design or an explanatory sequential design, to examine the relationship between ethical leadership and employee trust.