The Relationships among Employee Empowerment, Corporate Repututation, and Firm Performance: Research in the Turkish Manufacturing Industry

Abstract

Purpose

The purpose of this paper is to describe and analyze the mutual relationships among an empowerment climate, psychological empowerment, corporate repututation, and firm performance.

Theoretical framework

This paper builds on the literature on empowerment and corporate reputation to propose a comprehensive research model to examine how corporate repututation and firm performance are shaped by empowerment practices.

Design/methodology/approach

To achieve the objective of the study, the partial least squares approach and bootstrapping re-sampling method were used to test the hypotheses. A survey was carried out to collect data from 225 employees of the manufacturing industry in Turkey.

Findings

The findings support the positive impact of an empowerment climate on psychological empowerment. In addition, an empowerment climate appears to be a variable that strongly increases both corporate reputation and firm performance. Furthermore, the results reveal that perceived corporate reputation is positively associated with both financial and non-financial performance.

Practical & social implications of the research

This research provides an important contribution by showing how macro-level empowerment practices such as an empowerment climate influence micro-level feelings of empowerment such as psychological empowerment and that both, in turn, are related to corporate reputation and firm performance.

Originality/value

This research provides an important contribution by showing how macro-level empowerment practices such as an empowerment climate influence micro-level feelings of empowerment such as psychological empowerment and that both, in turn, are related to perceived corporate reputation and firm performance.

Keywords:
empowerment climate; psychological empowerment; corporate reputation; firm performance