Cultivating intention to stay: A cross-cultural exploration of leadership and ethical climates in hotel industry

Abstract

The independent hotel sector struggles with employee retention amid competition from larger chains. This study explores how leadership styles (Transformational/Transactional) influence retention intentions through Ethical Climate, Balanced Organizational Culture, and Organizational Commitment, comparing the UK and Spain. Grounded in Social Exchange Theory (SET), we analyze 962 employee responses using structural equation modelling. Results show Balanced Organizational Culture is the strongest mediator between leadership and retention. Cultural differences moderate these effects: Transformational Leadership suits the UK’s reciprocal loyalty norms, while Transactional Leadership aligns with Spain’s structured expectations. SET explains these dynamics, as UK employees reciprocate transformational behaviors with commitment, whereas Spanish employees respond to transactional exchanges. The findings help independent hotels tailor leadership strategies to reduce turnover.