Moderator or Mediator? Examining the Role of Trust in the Transformational Leadership Paradigm

A field study of 209 leader-follower dyads was conducted to examine the role of trust within the transformational leadership paradigm. Specifically, the goal was to answer the question, "Is trust simply an outcome of transformational leadership or does it serve a more complex role as a moderator or a mediator? " Results from the analysis using a bootstrapping technique with structural equation modeling revealed no support for the role of trust as a moderator of the relationship between transformational leadership and a variety of follower outcomes. However, trust fully mediated the relationships between transformational leadership behavior and organizational citizenship behavior, performance, and affective commitment. An examination of the leadership literature reveals that trust has been more frequently cited in discussions of transformational leadership than any other leadership theory (Dirks and Ferrin, 2002). Research described in a number of articles has examined the relationship between transformational leadership and trust (Bass, 1985; Bass and Avolio, 1994; Dirks and Ferrin, 2002; Jung and Avolio, 2000; Podsakoff et al., 1996; Podsakoff et al., 1990) identifying trust as an outcome (or correlate) among other outcomes of transformational leadership (e.g., Avolio et al., 2004). Other research suggested a more complex role for trust within the transformational leadership paradigm. Some have viewed trust as a moderator within the context of situational influences in the transformational leadership paradigm (e.g., Neeraj, 2009). Yet others have viewed trust as a mediator of the relationship between transformational leadership and other outcomes (e.g., Jung and Avolio, 2000). If trust acts as a moderator of the relationships between transformational leadership and follower attitudes and behaviors, then the full potential of transformational leadership may not be realized if trust is absent. On the other hand, if trust acts as a mediator in these relationships, then it may not only be a direct outcome of transformational leadership, but it also may explain how or why transformational leadership relates to other outcomes as well. The purpose of this research is to conduct an empirical analysis of the role of trust in the transformational leadership paradigm. Relevant research is reviewed in the discussion that follows; the proposed hypotheses are then presented. THE SIGNIFICANCE OF TRUST IN THE LEADER-FOLLOWER RELATIONSHIP Clear implications for the effect of trust in leadership on follower behavior have been emphasized in publications in the popular management press (Kouzes and Posner, 2008; Covey, 1990; Covey, 2008; Galford and Drapeau, 2003 a, b) and in scholarly research articles (e.g., Mulder, 2009; Colquitt et al., 2007). Trust is not only important for sustaining individual and organizational effectiveness (McAllister, 1995), but it also lies at the heart of relationships and influences the behavior of each part',' toward the other (Robinson, 1996). The leader-follower relationship is no exception. When subordinates trust a leader, they are willing to be exposed to the leader's actions, and are certain that their interests will not be abused (Mayer et al., 1995). If this trust is broken, it can have severe undesirable effects (Dirks and Ferrin, 2002). In the process of motivating followers to implement their shared vision, transformational leaders become role models for their followers demonstrating what it means to persevere and make self-sacrifices when needed (Jung and Avolio, 2000). Through observation of their leaders, followers develop trust in them because of their leaders' personal commitment to achieving the vision. Furthermore, transformational leaders empower and encourage followers to think for themselves, which instills trust in the leader (Bass and Avolio, 1995). On the flip side, transformational leadership can involve moving followers from the familiar to the unfamiliar. …