Journal of Business Ethics

, Volume 128, Issue 3, pp 617–634 | Cite as

Authentic Leaders Promoting Store Performance: The Mediating Roles of Virtuousness and Potency

  • Arménio RegoEmail author
  • Dálcio Reis Júnior
  • Miguel Pina e Cunha


Sixty-eight stores of a retail chain were used for testing a model in which perceived authentic leadership (AL) predicts stores’ sales achievement through the mediating role of perceived store virtuousness and perceived store potency. Employees reported AL, store virtuousness, and store potency. Sales achievement over a period of four consecutive months subsequent to data collection (on independent and mediating variables) was considered as dependent variable (for control: sales achievement in the previous 4 months). The main findings are the following: (a) AL predicts store potency through the mediating role of store virtuousness; (b) store virtuousness predicts sales achievement through the mediating role of store potency; (c) AL predicts sales achievement via the mediating role of both store virtuousness and store potency. By focusing on three positive constructs, whose interrelations have scarcely been explored, and relating them to store performance, the study enriches the Positive Organizational Scholarship movement, and suggests that AL and virtuousness are good in themselves and also potential facilitators of group success.


Authentic leadership Group performance Group potency Group virtuousness 



Miguel Cunha gratefully acknowledges support from Nova Forum.


  1. Ashforth, B. E., & Mael, F. (1989). Social identity theory and the organization. Academy of Management Review, 14, 20–39.Google Scholar
  2. Avolio, B. (2010). Pursuing authentic leadership development. In N. Nohria & R. Khurana (Eds.), Handbook of leadership theory and practice (pp. 739–768). Boston: Harvard Business School Press.Google Scholar
  3. Avolio, B. J., & Gardner, W. (2005). Authentic leadership development: Getting to the root of positive forms of leadership. Leadership Quarterly, 16, 315–338.CrossRefGoogle Scholar
  4. Avolio, B. J., Gardner, W. L., Walumbwa, F. O., Luthans, F., & May, D. R. (2004a). Unlocking the mask: A look at the process by which authentic leaders impact follower attitudes and behaviors. Leadership Quarterly, 15, 801–823.CrossRefGoogle Scholar
  5. Avolio, B. J., & Mhatre, K. H. (2012). Advances in theory and research on authentic leadership. In K. S. Cameron & G. Spreitzer (Eds.), The Oxford handbook of positive organizational scholarship (pp. 773–783). Oxford: Oxford University Press.Google Scholar
  6. Avolio, B. J., Zhu, W., Kho, W., & Bhatia, P. (2004b). Transformational leadership and organizational commitment: Mediating role of psychological empowerment and moderating role of structural distance. Journal of Organizational Behavior, 25, 951–968.CrossRefGoogle Scholar
  7. Bandura, A. (1997). Self-efficacy: The Exercise of Control. New York: Freeman and Company.Google Scholar
  8. Biemann, T., Cole, M. S., & Voelpel, S. (2012). Within-group agreement: On the use (and misuse) of r WG and r WG(J) in leadership research and some best practice guidelines. Leadership Quarterly, 23, 66–80.CrossRefGoogle Scholar
  9. Bliese, P. D. (2000). Within-group agreement, non-independence, and reliability: Implications for data aggregation and analysis. In K. J. Klein & S. W. Kozlowski (Eds.), Multilevel theory, research, and methods, in organizations: Foundations, extensions, and new directions (pp. 349–381). San Francisco: Jossey-Bass.Google Scholar
  10. Braun, S., Peus, C., Weisweiler, S., & Frey, D. (2013). Transformational leadership, job satisfaction, and team performance: A multilevel mediation model of trust. Leadership Quarterly, 24, 270–283.CrossRefGoogle Scholar
  11. Bunderson, J. S., & Thompson, J. (2009). The call of the wild: Zookeepers, callings, and the double-edged sword of deeply meaningful work. Administrative Science Quarterly, 54, 32–57.CrossRefGoogle Scholar
  12. Cameron, K. S., Bright, D., & Caza, A. (2004). Exploring the relationships between organizational virtuousness and performance. American Behavioral Scientist, 47, 766–790.CrossRefGoogle Scholar
  13. Cameron, K., Mora, C., Leutscher, T., & Calarco, M. (2011). Effects of positive practices on organizational effectiveness. Journal of Applied Behavioral Science, 47, 266–308.CrossRefGoogle Scholar
  14. Cameron, K. S., & Spreitzer, G. M. (Eds.). (2012). The Oxford handbook of positive organizational scholarship. Oxford: Oxford University Press.Google Scholar
  15. Cameron, K. S., & Winn, B. (2012). Virtuousness in organizations. In K. S. Cameron & G. M. Spreitzer (Eds.), The Oxford handbook of positive organizational scholarship (pp. 231–243). Oxford: Oxford University Press.Google Scholar
  16. Campion, M. A., Papper, E. M., & Medsker, G. J. (1996). Relations between work team characteristics and effectiveness: A replication and extension. Personnel Psychology, 49, 429–452.CrossRefGoogle Scholar
  17. Chen, G., Mathieu, J. E., & Bliese, P. D. (2004). A framework for conducting multi-level construct validation. In F. J. Yammarino & F. Dansereau (Eds.), Research in multilevel issues: Multilevel issues in organizational behavior and processes (Vol. 3, pp. 273–303). Oxford: Elsevier.CrossRefGoogle Scholar
  18. Clapp-Smith, R., Vogelgesang, G. R., & Avey, J. B. (2009). Authentic leadership and positive psychological capital: The mediating role of trust at the group level of analysis. Organizational Studies, 15, 227–240.Google Scholar
  19. Cohen, A., Doveh, E., & Nahum-Shani, I. (2009). Testing agreement for multi-item scales with the indices r WG(J) and ADM(J). Organizational Research Methods, 12, 148–164.CrossRefGoogle Scholar
  20. Cooper, C. D., Scandura, T. A., & Schriesheim, C. A. (2005). Looking forward but learning from our past: Potential challenges to developing authentic leadership theory and authentic leaders. Leadership Quarterly, 16, 475–493.CrossRefGoogle Scholar
  21. Cosse, T. J., Ashworth, D. N., & Weisenberger, T. M. (1999). The effects of team size in a marketing simulation. Journal of Marketing Theory and Practice, 7, 98–106.Google Scholar
  22. Cunha, M. P., Rego, A., & Kamoche, K. (2009). Improvisation in service recovery. Managing Service Quality, 19, 657–669.CrossRefGoogle Scholar
  23. Damon, W. (2004). The moral advantage—How to succeed in business by doing the right thing. San Francisco: Berrett-Koehler.Google Scholar
  24. De Jong, A., de Ruyter, K., & Wetzels, M. (2005). Antecedents and consequences of group potency: A study of self-managing service teams. Management Science, 51, 1610–1625.CrossRefGoogle Scholar
  25. Deci, E. L., & Ryan, R. M. (2000). “What” and “why” of goal pursuits: Human needs and the self-determination of behavior. Psychological Inquiry, 11, 227–268.CrossRefGoogle Scholar
  26. Dionne, S. D., Sayama, H., Hao, C., & Bush, B. J. (2010). The role of leadership in shared mental model convergence and team performance improvement: An agent-based computational model. Leadership Quarterly, 21, 1035–1049.CrossRefGoogle Scholar
  27. Dirks, K. T., & Ferrin, D. L. (2001). The role of trust in organizational settings. Organization Science, 12, 450–467.CrossRefGoogle Scholar
  28. Dirks, K. T., & Ferrin, D. L. (2002). Trust in leadership: Meta-analytic findings and implications for research and practice. Journal of Applied Psychology, 87, 611–628.CrossRefGoogle Scholar
  29. Edmondson, A. (1999). Psychological safety and learning behavior in work teams. Administrative Science Quarterly, 44, 350–383.CrossRefGoogle Scholar
  30. Gardner, W. L., Avolio, B. J., Luthans, F., May, D. R., & Walumbwa, F. (2005). “Can you see the real me?” A self-based model of authentic leader and follower development. Leadership Quarterly, 16, 343–372.CrossRefGoogle Scholar
  31. Gardner, W. L., Cogliser, C. C., Davis, K. M., & Dickens, M. P. (2011). Authentic leadership: A review of the literature and research agenda. Leadership Quarterly, 22, 1120–1145.CrossRefGoogle Scholar
  32. Gardner, W. L., & Schermerhorn, J. R, Jr. (2004). Unleashing individual potential: Performance gains through positive organizational behavior and authentic leadership. Organizational Dynamics, 33, 270–279.CrossRefGoogle Scholar
  33. Gelade, G. A., & Young, S. (2005). Test of a service chain model in the retail banking sector. Journal of Occupational and Organizational Psychology, 78, 1–22.CrossRefGoogle Scholar
  34. George, B. (2003). Authentic leadership: Rediscovering the secrets to creating lasting value. San Francisco: Jossey Bass.Google Scholar
  35. Ghoshal, S. (2005). Bad management theories are destroying good management practices. Academy of Management Learning and Education, 4, 75–91.CrossRefGoogle Scholar
  36. Gibson, C. B., & Earley, P. C. (2007). Collective cognition in action: Accumulation, interaction, examination, and accommodation in the development and operation of group efficacy beliefs in the workplace. Academy of Management Review, 32, 438–458.CrossRefGoogle Scholar
  37. Glick, W. (1985). Conceptualizing and measuring organizational and psychological climate: Pitfalls in multilevel research. Academy of Management Review, 10, 601–616.Google Scholar
  38. Goddard, D., & Salloum, S. J. (2012). Collective efficacy beliefs, organizational excellence, and leadership. In K. S. Cameron & G. M. Spreitzer (Eds.), The Oxford handbook of positive organizational scholarship (pp. 642–650). Oxford: Oxford University Press.Google Scholar
  39. Gómez, M. I., McLaughlin, E. W., & Wittink, D. R. (2004). Customer satisfaction and retail sales performance: An empirical investigation. Journal of Retailing, 80, 265–278.CrossRefGoogle Scholar
  40. Goodhue, D. L., Lewis, W., & Thompson, R. (2012). Research note: Does PLS have advantages for small sample size or non-normal data? MIS Quarterly, 36, 981–1001.Google Scholar
  41. Grojean, M. W., Resick, C. J., Dickson, M. W., & Smith, D. B. (2004). Leaders, values, and organizational climate: Examining leadership strategies for establishing an organizational climate regarding ethics. Journal of Business Ethics, 55, 223–241.CrossRefGoogle Scholar
  42. Gully, S. M., Joshi, A., Incalcaterra, K. A., & Beaubien, J. M. (2002). Meta-analysis of team-efficacy, potency, and performance: Interdependence and level of analysis as moderators of observed relationships. Journal of Applied Psychology, 87, 819–832.CrossRefGoogle Scholar
  43. Guzzo, R. A., Yost, P. R., Campbell, R. J., & Shea, G. P. (1993). Potency in groups: Articulating a construct. British Journal of Social Psychology, 32, 87–106.CrossRefGoogle Scholar
  44. Gwinner, K. P., Bitner, M. J., Brown, S. W., & Kumar, A. (2005). Service customization through employee adaptiveness. Journal of Service Research, 8, 131–148.CrossRefGoogle Scholar
  45. Harvey, P., Martinko, M. J., & Gardner, W. L. (2006). Promoting authentic behavior in organizations: An attributional perspective. Journal of Leadership and Organizational Studies, 12, 1–11.Google Scholar
  46. Heskett, J. L., Sasser, W. E, Jr, & Schlesinger, L. A. (1997). The service profit chain. New York: Free Press.Google Scholar
  47. Howell, J. M., & Shea, C. M. (2006). Effects of champion behavior, team potency, and external communication activities on predicting team performance. Group and Organization Management, 31, 180–211.CrossRefGoogle Scholar
  48. Hsiung, H–. H. (2012). Authentic leadership and employee voice behavior: A multi-level psychological process. Journal of Business Ethics, 107, 349–361.CrossRefGoogle Scholar
  49. Hu, J., & Liden, R. C. (2011). Antecedents of team potency and team effectiveness: An examination of goal and process clarity and servant leadership. Journal of Applied Psychology, 96, 851–862.CrossRefGoogle Scholar
  50. Iacobucci, D., Saldanha, N., & Deng, X. (2007). A meditation on mediation: Evidence that structural equations models perform better than regressions. Journal of Consumer Psychology, 17, 139–153.CrossRefGoogle Scholar
  51. Ilies, R., Morgeson, F. P., & Nahrgang, J. D. (2005). Authentic leadership and eudaemonic well-being: Understanding leader–follower outcomes. Leadership Quarterly, 16, 373–394.CrossRefGoogle Scholar
  52. James, L. R., Demaree, R. G., & Wolf, G. (1984). Estimating within-group inter-rater reliability with and without response bias. Journal of Applied Psychology, 69, 85–98.CrossRefGoogle Scholar
  53. Janssen, O., & Huang, X. (2008). Us and me: Team identification and individual differentiation as complementary drivers of team members’ citizenship and creative behaviors. Journal of Management, 34, 69–88.CrossRefGoogle Scholar
  54. Jung, D. I., & Sosik, J. J. (2003). Group potency and collective efficacy: Examining their predictive validity, level of analysis, and effects of performance feedback on future group performance. Group and Organization Management, 28, 366–391.CrossRefGoogle Scholar
  55. Kenny, D. A., & la Voie, L. (1985). Separating individual and group effects. Journal of Personality and Social Psychology, 48, 339–348.CrossRefGoogle Scholar
  56. Kirkman, B. L., & Rosen, B. (1999). Beyond self-management: Antecedents and consequences of team empowerment. Academy of Management Journal, 42, 58–74.CrossRefGoogle Scholar
  57. Kruglanski, A. W., Pierro, A., Mannetti, L., & De Grada, E. (2006). Groups as epistemic providers: Need for closure and the unfolding of group-centrism. Psychological Review, 113, 84–100.CrossRefGoogle Scholar
  58. LeBreton, J. M., & Senter, J. L. (2008). Answers to 20 questions about interrater reliability and interrater agreement. Organizational Research Methods, 11, 815–852.CrossRefGoogle Scholar
  59. Lee, C., Farh, J., & Chen, Z. (2011). Promoting group potency in project teams: The importance of group identification. Journal of Organizational Behavior, 32, 1147–1162.CrossRefGoogle Scholar
  60. LePine, J., Piccolo, R., Jackson, C., Mathieu, J., & Saul, J. (2008). A meta-analysis of teamwork processes: Tests of a multidimensional model and relationships with the team effectiveness criteria. Personnel Psychology, 61, 273–307.CrossRefGoogle Scholar
  61. Leroy, H., Palanski, M. E., & Simons, T. (2012). Authentic leadership and behavioral integrity as drivers of follower commitment and performance. Journal of Business Ethics, 107, 255–264.Google Scholar
  62. Lester, S. W., Meglino, B. M., & Koorsgaard, M. A. (2002). The antecedents and consequences of group potency: A longitudinal investigation of newly formed work groups. Academy of Management Journal, 45, 352–368.CrossRefGoogle Scholar
  63. Leung, K. (1997). Relationships among satisfaction, commitment, and performance: A group-level analysis. Applied Psychology: An International Review, 46, 199–206.Google Scholar
  64. Luthans, F., & Avolio, B. (2003). Authentic leadership: A positive development approach. In K. S. Cameron, J. E. Dutton, & R. E. Quinn (Eds.), Positive organizational scholarship (pp. 241–258). San Francisco: Berrett-Koehler.Google Scholar
  65. Luthans, F., Youssef, C. M., & Avolio, B. J. (2007). Psychological Capital. Oxford: Oxford University Press.Google Scholar
  66. May, D. R., Chan, A., Hodges, T., & Avolio, B. J. (2003). Developing the moral component of authentic leadership. Organizational Dynamics, 32, 247–260.CrossRefGoogle Scholar
  67. Mayer, R. C., Davis, J. H., & Schoorman, F. D. (1995). An integrative model of organizational trust. Academy of Management Review, 20, 709–734.Google Scholar
  68. Meindl, J. R. (1995). The romance of leadership as a follower centric theory: A social constructionist approach. Leadership Quarterly, 6, 329–341.CrossRefGoogle Scholar
  69. Michel, J. W., Lyons, B. D., & Cho, J. (2011). Is the full-range model of leadership really a full-range model of effective leader behavior? Journal of Leadership and Organizational Studies, 18, 493–507.CrossRefGoogle Scholar
  70. Neider, L. L., & Schriesheim, A. C. (2011). The Authentic Leadership Inventory (ALI): Development and empirical tests. Leadership Quarterly, 22, 1146–1164.CrossRefGoogle Scholar
  71. Neininger, A., Lehmann-Willenbrock, N., Kauffelda, S., & Henschela, A. (2010). Effects of team and organizational commitment: A longitudinal study. Journal of Vocational Behavior, 76, 567–579.CrossRefGoogle Scholar
  72. Nohria, N., & Khurana, R. (2010). Advancing leadership theory and practice. In N. Nohria & R. Khurana (Eds.), Handbook of leadership theory and practice (pp. 3–25). Boston: Harvard Business School Press.Google Scholar
  73. Palanski, M. E., Kahai, S. S., & Yammarino, F. J. (2011). Team virtues and performance: An examination of transparency, behavioral integrity, and trust. Journal of Business Ethics, 99, 201–216.CrossRefGoogle Scholar
  74. Palanski, M. E., & Yammarino, F. J. (2009). Integrity and leadership: A multi-level conceptual framework. Leadership Quarterly, 20, 405–420.CrossRefGoogle Scholar
  75. Peterson, C. (2000). The future of optimism. American Psychologist, 55, 44–55.CrossRefGoogle Scholar
  76. Peterson, S. S., Walumbwa, F. O., Avolio, B. J., & Hannah, S. T. (2012). The relationship between authentic leadership and follower job performance: The mediating role of follower positivity in extreme contexts. Leadership Quarterly, 22, 502–516.CrossRefGoogle Scholar
  77. Peus, C., Wesche, J. S., Streicher, B., Braun, S., & Frey, D. (2012). Authentic leadership: An empirical test of its antecedents, consequences, and mediating mechanisms. Journal of Business Ethics, 107, 331–348.CrossRefGoogle Scholar
  78. Podsakoff, P. M., Mackenzie, S. B., & Podsakoff, N. P. (2012). Sources of method bias in social science research and recommendations on how to control it. Annual Review of Psychology, 63, 539–569.CrossRefGoogle Scholar
  79. Price, J. L., & Mueller, C. W. (1986). Handbook of Organizational Measurement. Marshfield, MA: Pitman.Google Scholar
  80. Pugh, S. D. (2001). Service with a smile: Emotional contagion in the service encounter. Academy of Management Journal, 44, 1018–1027.CrossRefGoogle Scholar
  81. Rego, A., Ribeiro, N., & Cunha, M. P. (2010). Perceptions of organizational virtuousness and happiness as predictors of organizational citizenship behaviors. Journal of Business Ethics, 93, 215–225.CrossRefGoogle Scholar
  82. Rego, A., Sousa, F., Marques, S., & Cunha, M. P. (2012). Authentic leadership promoting employees’ psychological capital and creativity. Journal of Business Research, 65, 429–437.CrossRefGoogle Scholar
  83. Rego, A., Sousa, F., Marques, S., & Cunha, M. P. C. (2014). Hope and positive affect mediating the authentic leadership and creativity relationship. Journal of Business Research, 67(2), 200–210.Google Scholar
  84. Rego, A., Vitória, A., Magalhães, A., Ribeiro, N., & Cunha, M. P. (2013). Are authentic leaders associated with more virtuous, committed and potent teams? Leadership Quarterly, 24, 61–79.CrossRefGoogle Scholar
  85. Rucci, A. J., Kirn, S. P., & Quinn, R. T. (1998). The employee–customer–profit chain at Sears. Harvard Business Review, January–February, 83–97.Google Scholar
  86. Ryan, R. M., & Deci, E. L. (2000). Self-determination theory and the facilitation of intrinsic motivation, social development, and well-being. American Psychologist, 55, 68–78.CrossRefGoogle Scholar
  87. Schneider, B., Goldstein, H. W., & Smith, D. B. (1995). The ASA framework: An update. Personnel Psychology, 48, 747–779.CrossRefGoogle Scholar
  88. Schoorman, F. D., Mayer, R. C., & Davis, J. H. (2007). An integrative model of organizational trust: Past, present and future. Academy of Management Review, 32(2), 344–354.CrossRefGoogle Scholar
  89. Seligman, M. E. P., & Schulman, P. (1986). Explanatory style as a predictor of productivity and quitting among life insurance agents. Journal of Personality and Social Psychology, 50, 832–838.CrossRefGoogle Scholar
  90. Shea, G. P., & Guzzo, R. A. (1987). Group effectiveness: What really matters? Sloan Management Review, 28, 25–31.Google Scholar
  91. Shelton, P. M., Waite, A. M., & Makela, C. J. (2010). Highly effective teams: A relational analysis of group potency and perceived organizational support. Advances in Developing Human Resources, 12, 93–114.CrossRefGoogle Scholar
  92. Stajkovic, A. D., Lee, D., & Nyberg, A. J. (2009). Collective efficacy, group potency, and group performance: Meta-analyses of their relationships, and test of a mediation model. Journal of Applied Psychology, 94, 814–828.CrossRefGoogle Scholar
  93. Stephens, J. P., Heaphy, E., & Dutton, J. E. (2012). High quality connections. In K. Cameron & G. Spreitzer (Eds.), The Oxford handbook of positive organizational scholarship (pp. 385–399). New York: Oxford University Press.Google Scholar
  94. Story, J. S. P., Youssef, C. M., Luthans, F., Barbuto, J. E., & Bovaird, J. (2013). Contagion effect of global leaders’ positive psychological capital on followers: Does distance and quality of relationship matter? International Journal of Human Resource Management, 24(3), 2534–2553.CrossRefGoogle Scholar
  95. Tsai, W.-C., Chi, N.-W., Grandey, A. A., & Fung, S.-C. (2012). Positive group affective tone and team creativity: Negative group affective tone and team trust as boundary conditions. Journal of Organizational Behavior, 33, 638–656.CrossRefGoogle Scholar
  96. Waldman, D. A., & Yammarino, F. J. (1999). CEO charismatic leadership: Levels-of-management and levels-of-analysis effects. Academy of Management Review, 24, 266–285.Google Scholar
  97. Walter, F., & Bruch, H. (2008). The positive group affect spiral: A dynamic model of the emergence of positive affective similarity in work groups. Journal of Organizational Behavior, 29, 239–261.CrossRefGoogle Scholar
  98. Walumbwa, F. O., Avolio, B. J., Gardner, W. L., Wernsing, T. S., & Peterson, S. J. (2008). Authentic leadership: Development and validation of a theory-based measure. Journal of Management, 34, 89–126.CrossRefGoogle Scholar
  99. Walumbwa, F. O., Luthans, F., Avey, J. B., & Oke, A. (2011). Authentically leading groups: The mediating role of collective psychological capital and trust. Journal of Organizational Behavior, 32, 4–24.CrossRefGoogle Scholar
  100. Walumbwa, F. O., Wang, P., Wang, H., Schaubroeck, J., & Avolio, B. J. (2010). Psychological processes linking authentic leadership to follower behaviors. Leadership Quarterly, 21, 901–914.CrossRefGoogle Scholar
  101. Wang, H., Law, K. S., Hackett, R. D., Wang, D., & Chen, Z. X. (2005). Leader–member exchange as a mediator of the relationship between transformational leadership and followers’ performance and organizational citizenship behavior. Academy of Management Journal, 48, 420–432.CrossRefGoogle Scholar
  102. West, B. J., Patera, J. L., & Carsten, M. K. (2009). Team level positivity: Investigating positive psychological capacities and team level outcomes. Journal of Organizational Behavior, 30, 249–267.CrossRefGoogle Scholar
  103. Yammarino, F. J., Dionne, S. D., Chun, J. U., & Dansereau, F. (2005). Leadership and levels of analysis: A state-of-the-science review. Leadership Quarterly, 16, 879–919.CrossRefGoogle Scholar
  104. Yammarino, F. J., Dionne, S. D., Schriesheim, C. A., & Dansereau, F. (2008). Authentic leadership and positive organizational behavior: A meso-, multi-level perspective. Leadership Quarterly, 19, 693–707.CrossRefGoogle Scholar

Copyright information

© Springer Science+Business Media Dordrecht 2014

Authors and Affiliations

  • Arménio Rego
    • 1
    • 2
    Email author
  • Dálcio Reis Júnior
    • 1
    • 3
  • Miguel Pina e Cunha
    • 4
  1. 1.Universidade de AveiroAveiroPortugal
  2. 2.Business Research Unit (ISCTE-IUL)Instituto Universitário de LisboaLisbonPortugal
  3. 3.Universidade PositivoCuritibaBrasil
  4. 4.Nova School of Business and EconomicsINOVA, Universidade Nova de LisboaLisbonPortugal

Personalised recommendations