Introduction
Neoliberalism is a hegemonic ideology that prioritizes marketization over social good rationales, radically transforming how management, leadership, and organizing are practiced internationally. Stiglitz (Reference Stiglitz2019) explains that the impact of neoliberalism has been uneven in different national contexts. Countries which made their industries and leaders responsible for people management and human rights have experienced less toxic impacts of neoliberalism (Vincent et al., Reference Vincent, Lopes, Meliou and Özbilgin2024). However, countries with less supportive legal policies and discourses for employment and human rights had more adverse impacts (Kusku et al., Reference Kusku, Aracı and Ozbilgin2021). Although neoliberalism is now well studied in terms of its meaning, values, and processes, there is little understanding of the interplay between managerialism (i.e., an ideology of relying on managers instead of professional staff for improved efficiency) and toxic leadership behaviors (i.e., leadership behaviors that have sustained harm on some followers, wider audience, and other communities) in untamed neoliberal contexts. We address the curious yet underexplored interplay between managerialism, toxic leadership, and ethical climate in a sector which has been at the grasp of untamed neoliberalism in a country with ceremonial legal, policy, and discursive support for employment and human rights. Turkey has an untamed hegemonic neoliberal ideology across all its sectors of work, including the healthcare sector (Konuralp & Bicer, Reference Konuralp and Bicer2021). There are reports of managerialism and toxic leadership behaviors leading to high turnover and migration patterns among Turkish doctors (Önal & Akay, Reference Önal and Akay2023). Over 3,000 Turkish doctors migrated out of Turkey in unprecedented numbers in the last 3 years (Genc, Reference Genc2022). Studying how managerialism, toxic leadership, and ethical climate interplay in the Turkish healthcare sector fills an important gap in the extant literature and offers insights into how neoliberalism and its concomitant management and leadership behaviors manifest and how ethical climate matters in this relationship.
Managerialism, which refers to a management’s style and practices systematically justified and established on the grounds of the superiority of an ideology that prioritizes efficiency over other concerns (Bresnen, Hyde, Hodgson, Bailey, & Hassard, Reference Bresnen, Hyde, Hodgson, Bailey and Hassard2015), may affect leadership emergence and behaviors in organizations. Locke and Spencer (Reference Locke and Spencer2011) claim that ‘managerialism’ emerged due to corporate leaders’ ideology, attitude, and behavior with no moral and ethical concern for society and social good, the firm’s employees and other stakeholders beyond a narrow interest in efficient work that improves shareholder value. So, the corporate leaders of organizations with a managerialist approach may be more likely to engage in detrimental and toxic behaviors that focus on effectiveness and efficiency to serve a narrow set of interests (Mackey, Parker Ellen, McAllister, & Alexander, Reference Mackey, Parker Ellen, McAllister and Alexander2021; Schyns & Schilling, Reference Schyns and Schilling2013).
Toxic leadership creates destructive effects on business organizations and deteriorates the welfare of the whole society (Mackey, McAllister, Maher, & Wang, Reference Mackey, McAllister, Maher and Wang2019; Smith & Fredricks-Lowman, Reference Smith and Fredricks-Lowman2020). Toxic leadership led to many crises in organizations, such as the corporate fraud in Enron (Ailon, Reference Ailon2011), sexual misconduct and bullying in Oxfam (Clarke, Reference Clarke2021), fixation of company profitability in Volkswagen (Coldwell, Reference Coldwell2021) and Boeing (Pontefract, Reference Pontefract2019) at any cost, and monetization of private user data by Facebook (Venturini & Rogers, Reference Venturini and Rogers2019). Acuña and Male (Reference Acuña and Male2022) define toxic leadership ‘as a leadership style based on the physical and emotional impairment of people, with harmful consequences for their followers at a personal and organizational level’ (p. 1). Scholars (Mergen & Ozbilgin, Reference Mergen and Ozbilgin2021a; Thoroughgood, Sawyer, Padilla, & Lunsford, Reference Thoroughgood, Sawyer, Padilla and Lunsford2018) who identify various constructs within the scope of negative and destructive leader behaviors such as egoistic attitude, self-centered approach, aggressiveness, despotism, bad temperament, and sustained display of hostility and/or obstructiveness to the followers, are mostly covered by toxic leadership. Many positive leadership theories assume dysfunctional leadership is simply the absence or opposite of effective leadership (Gilson et al., Reference Gilson, Ellokor, Lehmann and Brady2020; Hunter, Bedell-Avers, Angie, Eubanks, & Mumford, Reference Hunter, Bedell-Avers, Angie, Eubanks and Mumford2009). Nevertheless, the emergence and development of leader toxicity are more than complex and influenced by other situational factors (Eva, Sendjaya, Prajogo, & Madison, Reference Eva, Sendjaya, Prajogo and Madison2021), such as the ideology underneath the management style (managerialism) and the managers’ generic tools and knowledge adopted (Cahill, Reference Cahill2014), organizational culture and climate (Bass & Avolio, Reference Bass and Avolio1993), and the macro-national context which legitimates or delegitimizes toxic leadership.
In an organization where an ethical climate constituted by strong moral and ethical values, norms, behaviors, attitudes, and perceptions is embraced, unethical codes of conduct and toxic behaviors that emerged from managerialism may be denied (Martin, Emich, McClean, & Woodruff, Reference Martin, Emich, McClean and Woodruff2022). We propose that a higher level of ethical climate perception disallows toxic leader behaviors emerging from managerialism and weakens the impact of managerialism on toxic leadership emergence. Therefore, we suggest that ethical climate moderates the relationship between managerialism and the emergence of toxic leadership.
The impact of managerialism on toxic leadership emergence may be relatively stronger in some sectors where public services are offered, that is, education and healthcare (Kamasak & Ozbilgin, Reference Kamasak, Ozbilgin, Christiansen and Branch2021; Shepherd, Reference Shepherd2018). For example, increased control, strict regulations, and intensive government interventions in the healthcare sector may lead healthcare institutions to follow more procedural, hierarchical, and autocratic management styles (Friel et al., Reference Friel, Collin, Daube, Depoux, Freudenberg, Gilmore and Mialon2023). The level of managerialism may increase in many government-controlled or influenced institutions due to a possible shift in authority from competence and merit to nepotism and subservience to the structures of power (cf. resurgence of fealty in Turkey as studied by Ozbilgin & Yalkin, Reference Ozbilgin and Yalkin2019). Additionally, the injection of market-type mechanisms by neoliberal policies, that is, competitive tendering, sector league tables, performance-related pay, and cost concerns of boards and top management, may compel hospitals and their senior managers to follow more competitive strategies (Westra, Angeli, Carree, & Ruwaard, Reference Westra, Angeli, Carree and Ruwaard2017).
Although neoliberalism was originally brought in with the espoused intent to improve healthcare, it had several unexpected adverse consequences (Dolezal & Spratt, Reference Dolezal and Spratt2023). Hospitals and other health institutions may adopt competitive strategies to meet market requirements. In the healthcare sector, where the players provide social services and deal with human health and life, competitive strategies introduced with the neoliberal turn should focus on improving patient care, increasing safety, and better use of technology and productivity (Parkinson, Reference Parkinson2018). However, the neoliberal turn reportedly led to severe cost cuttings, which generally exacerbated the working conditions of public sector workers such as doctors, nurses, and teachers (Friel et al., Reference Friel, Collin, Daube, Depoux, Freudenberg, Gilmore and Mialon2023). Drawing on a quantitative study conducted on a sample of medical doctors working in university hospitals in Turkey, we explore how toxic leadership may emerge under ethical climate and managerialism in the healthcare sector. This paper contributes to the scholarly discussions on two points. First, this study shows how toxic leadership emerges under managerialism and which organizational and ethical mechanisms and strategies should be established to combat it and/or minimize its adverse effects. Second, the study focuses on a critical sector, healthcare, which forms an essential part of human well-being and has been radically transformed due to neoliberal expansion, adopting market rationales above and beyond its foundational focus on public good and public health. In contrast to the traditional public health ethics in Turkey, we show the extent to which managerialism induced by neoliberalism triggered the toxic behaviors of leaders. Therefore, this paper presents evidence of the interplay between managerialism and toxic leadership behaviors and the moderating role of ethical climate in the healthcare sector in a country with an untamed neoliberal context and offers implications for policymakers.
Literature review and research hypotheses
Managerialism and toxic leadership
Managerialism is defined as ‘a set of ideologies about organizational practices and values used to bring about radical shifts [change] in organization, finances and cultures of public services such as local government, health and education’ (Deem, Reference Deem2004, p. 109). Managerialism ideology stems from the idea that managers play a crucial role in determining organizational outcomes. As Locke and Spencer (Reference Locke and Spencer2011) state, managerialism is a concept in which market orientation ideology, attitude, and behavior with little emphasis on moral values are adopted to manage employees at organizations. Thus, managerialism is expected to shape norms and standards that contribute to developing an organizational climate in the workplace. Some scholars (i.e., Deem, Reference Deem2004) consider managerialism as an international ideology that degrades every relation to a mere money exchange, which will bring a solution to social and economic problems. Managerialism has roots in the utilitarianism approach of ethics, and the concern for others’ benefits is generally limited to shareholder interests (Mineiro, Reference Mineiro2024). The managerialist ideology may view society as a market where communal well-being is not a priority (Tsui & Cheung, Reference Tsui and Cheung2004).
To cope with competition and environmental dynamism, managers may adopt a mindset that involves command, control, and strict devotion to one-size-fits-all types of procedures and may use reward- and punishment-based systems to achieve hard-to-reach performance expectations of firms (Cataltepe, Kamasak, Bulutlar, & Alkan, Reference Cataltepe, Kamasak, Bulutlar and Alkan2022). Therefore, organizations’ contemporary market-based concerns and expectations can support adopting the haunted principles of managerialism and may increase toxicity in corporate leaders’ decisions and behaviors (Mackey et al., Reference Mackey, McAllister, Maher and Wang2019). These toxic behaviors can be centered on abusing their subordinates by using a high level of authority, imposition, procedures, strict rules, and orders that are congruent with the principles of managerialism in their workplaces, conceptualizing customers as a source of income and cash contacts, and disregarding society and environment due to the firm’s market and profit related concerns (Klikauer, Reference Klikauer2015; Tsui & Cheung, Reference Tsui and Cheung2004). Toxicity may manifest as adverse outcomes for any of the organization’s stakeholders.
Toxic leaders’ egoistic behavior, unfaithfulness, neuroticism, and aggressiveness can be the salient characteristics (Badar, Aboramadan, & Plimmer, Reference Badar, Aboramadan and Plimmer2023; Mergen & Ozbilgin, Reference Mergen, Ozbilgin, Camgöz and Ekmekci2021b). According to Lipman-Blumen (Reference Lipman-Blumen2005), toxic leadership can be better understood through a multidimensional framework which covers the intentionality and intensity of toxicity and the types of destructive behavior and dysfunctional personal qualities of toxic leaders. Similarly, Schmidt (Reference Schmidt2015) associates five personality traits with toxic leadership behaviors. These personality traits are self-promotion, abusive supervision, unpredictability, narcissism, and authoritarianism. Toxic leadership manifests a particular type of personality that encompasses many behaviors affecting the administrative and organizational processes and employees’ mental and physical health (Mackey et al., Reference Mackey, Parker Ellen, McAllister and Alexander2021).
We suggest that managerialism may lead corporate leaders to follow toxic principles such as adapting autocratic, hierarchical, and strict procedural practices and leaving less room for participation in the workplace, showing toxic behaviors such as personal abuse of employees, and implementing business policies with no ethical concerns for society and environment (Schyns & Schilling, Reference Schyns and Schilling2013). In line, the strength and effect of a leader’s toxic behaviors may vary to the extent management ideology supports using such elements. Therefore, we hypothesize that:
Hypothesis 1: There is a significant positive relationship between managerialism and toxic leadership.
The moderating role of ethical climate in the relationship between managerialism and toxic leadership
Ethical climate refers to ‘the degree to which organizational systems support ethical attitudes and behaviors among employees’ (Hoffman et al., Reference Hoffman, Strang, Kuhnert, Campbell, Kennedy and LoPilato2013, p. 28). Several theorists (e.g., Applebaum et al., Reference Applebaum2005) describe ethical climate as a multidimensional construct and mention some factors, that is, team interests, social responsibility, personal morality, rules, laws, professional code of conduct, and behavior of top management as determinants of the ethical climate in an organization. Ross and Robertson (Reference Ross and Robertson2000) find that managers’ intention to make ethical decisions increases whilst their willingness to lie decreases in a climate, that is, intolerant to unethical behaviors. So, an ethical climate in an organization is the function of individuals’ perception of norms and moral values that can give way to toxic behaviors or obstruct them (Lemoine et al., Reference Lemoine, Hartnell and Leroy2019). An ethical climate that can strongly blame and condemn a leader’s unethical behaviors erodes a leader’s ability to influence followers and disempowers toxic behaviors and practices in the workplace (Aumentado, Balagtas, Cu, & Teng-Calleja, Reference Aumentado, Balagtas, Cu and Teng-Calleja2024). As different ethical climates are composed of different moral values, we believe their effect on the relationship between managerialism and toxic leadership may vary. Victor and Cullen (Reference Victor and Cullen1988) classify the dimensions of an ethical climate as caring, rules, law and code, independence, and instrumental.
In a caring ethical climate, organizational constituents perceive that decisions are mainly based on the well-being of others. This concern is reflected in the firm’s policies, practices, and strategies (Martin & Cullen, Reference Martin and Cullen2006). The magnitude of the importance of having good relationships with all stakeholders and looking after each other in an organization can disallow the emergence of toxic behaviors. Managerialism is theoretically linked with the concern for others’ benefits. Yet, this interest may be limited to the organization’s and top management’s interests, and the moral concerns may be replaced by ambitious short-term objectives that focus on cost reduction, efficiency, and market orientation (Carlisle, 2011). Therefore, a caring climate in which the main ethical concern is for others within the organization and society at large can mitigate the impact of managerialism, which may undermine collective benefits except for top managers’ and corporate leaders’ interests. Thus, we hypothesize that:
Hypothesis 2a: Caring ethical climate moderates the relationship between managerialism and toxic leadership, such that a higher level of caring ethical climate can weaken the association between managerialism and toxic leadership.
In a rules ethical climate, the prevalent decision-making criteria are a ubiquitous set of local rules or standards, like codes of conduct. Martin and Cullen (Reference Martin and Cullen2006) claim that organizations have been enforcing more and more sophisticated rules due to several enacted laws that mandate acceptable practices (i.e., Sarbanes–Oxley). Wimbush, Shepard, and Markham (Reference Wimbush, Shepard and Markham1997) state that ‘workers would be expected to adhere strictly to the rules and mandates of their organization’ (p. 68) in a rules ethical climate. Although the aim of the standard rules in a rules ethical climate is to hinder the arbitrary actions of individuals, these formal procedures, rules, and audits, which are the focal concerns of managerialism (Shepherd, 2018), can be used by corporate leaders and managers to legitimize their unethical behaviors and decisions. So, managerialism is expected to lead to more toxic leader behaviors in a rules ethical climate. Therefore, we suggest that:
Hypothesis 2b: Rules ethical climate moderates the relationship between managerialism and toxic leadership, such that managerialism is associated with higher toxic leadership in high levels of rules ethical climate.
In a law and code type of ethical climate, the organization is perceived to support principled decision-making. These principles have their roots in external codes such as the law, the Bible, or professional codes of conduct (Martin & Cullen, Reference Martin and Cullen2006). The constituents of a company with a law and code type of climate make their decisions per some external system like the law, and they do not look for loopholes (Wang & Hsieh, Reference Wang and Hsieh2013). These perceived external codes govern an employee’s ethical decisions and organizational behaviors. However, like in the rules ethical climate, in organizations where the prevalent management approach is characterized by managerialism, managers in key organizational roles may manipulate the law and code type of ethical climate and establish a basis to force others to implement whatever their plans and decisions are (Tsui & Cheung, Reference Tsui and Cheung2004). Therefore, we hypothesize that:
Hypothesis 2c: Law and code ethical climate moderates the relationship between managerialism and toxic leadership, such that managerialism is associated with higher toxic leadership in high levels of law and code ethical climate.
In an independent ethical climate, decisions that have moral consequences are taken according to personal moral beliefs without considering external forces (Martin & Cullen, Reference Martin and Cullen2006). Thus, individuals are ‘expected to be strongly guided by their personal moral beliefs’ (Wimbush et al., Reference Wimbush, Shepard and Markham1997, p. 68). Managerialism is based predominantly on the individual belief systems of the top managers (Barberis, Reference Barberis2012). Moreover, managerialism may reconfigure the milestones of democratic participation and create an autocratic environment. Yet, an independence ethical climate will not tolerate the managerialist approach, which leaves no room for employees’ liberty to act in their principles. Therefore, it is hypothesized that:
Hypothesis 2d: Independence ethical climate moderates the relationship between managerialism and toxic leadership, such that a higher level of independence ethical climate can weaken the association between managerialism and toxic leadership.
In an instrumental ethical climate, ‘organizational members look out for their own self-interest, first and foremost, even to the exclusion of the interest of others who may be affected by their decisions’ (Wimbush et al., Reference Wimbush, Shepard and Markham1997, p. 68). An instrumental climate may maximize self-interest and urge individuals to pursue their benefits while enhancing the firm’s benefits without considering any negative consequences for anyone except the company. In an organization where profit and efficiency maximization are prioritized, an instrumental ethical climate may encourage managers to care for their own interests and give no concern for the well-being of others. Therefore, we suggest that:
Hypothesis 2e: Instrumental ethical climate moderates the relationship between managerialism and toxic leadership, such that managerialism is associated with higher toxic leadership in high levels of instrumental ethical climate.
Figure 1 illustrates the proposed model of study concerning the hypotheses developed.
Proposed model of the study.
Context
The healthcare system in Turkey has witnessed significant reforms since introducing the Health Transformation Program, launched in 2003 (MoH, 2003). The main objectives of the Health Transformation Program were to combine the highly fragmented social insurance funds that offered unequal healthcare services in terms of quality, benefits packages, premium rates, and access to public and private facilities (Agartan, Reference Agartan2012) and achieve universal coverage. Thus, the Ministry of Health adopted several market incentives and mechanisms, that is, integrating all private and university hospitals into the system, limiting public hospital doctors working part-time in their private offices, and the permissions for private hospitals to sign contracts with insurance funds. With increased suppression and strict enforcement of the Ministry of Health, some doctors who protested the new part-time work schedule were prosecuted (CNNTurk, 2010). Perhaps the direction for the neoliberal policies and marketization in the healthcare system became most apparent after the Turkish Prime Minister announced that ‘free markets should be established in healthcare like in other sectors’ (Hürriyet, 2006). After his announcement, the private sector started to make huge investments in the healthcare sector. Moreover, several public hospitals underwent privatization. Unlike in industrialized countries where neoliberalism was introduced as a means to improve efficiencies in healthcare, in the Turkish case, the neoliberal turn was rationalized with a drive to open the sector to major commercial players without much public resistance. As a result, the number of private hospitals in the system increased from 270 in 2002 to 571 in 2021 (SIY, 2022), and the upward trend has continued. The reforms mentioned above, both in public and private hospitals, magnified the effect of neoliberalism. To address the financial expectations of private investors, the corporate leaders and managers of large hospital groups and hospitals of private universities were selected or appointed from other competitive sectors. Public hospitals in this competition suffered from the high pressure of performance, subject to quantitative measurement (OECD Reviews of Healthcare Quality Turkey, 2014).
All these implementations, which compelled the whole sector to focus on maximizing efficiency, productivity, and profitability, brought a shift of ideology close to managerialism in Turkey’s healthcare sector. The Health Transformation Program, whose success was linked to providing high-volume care and specialists’ remuneration, increased the competition and workload of doctors, nurses, and other health personnel in the system. In addition, coupled with the Coronavirus pandemic, the ongoing Syrian Civil War, which resulted in the migration of nearly 4 million refugees from Syria and other countries to Turkey who were granted free healthcare services, has even increased the workload of the healthcare workers. The President of Turkey severely criticized the demand for better working conditions for healthcare workers. In line with his comments, the pressure and burden on healthcare workers substantially increased, and 3,000 doctors migrated to developed countries during the global pandemic. To compensate for this loss, some hospitals started to employ migrant and refugee doctors from Syria and other countries based on lower pay scales. The neoliberal turn in Turkey entrenched managerialism, which in turn led to the emergence of several toxic leadership norms and behaviors. Turkish leadership culture has always involved a level of paternalism. This affinity with authority and hierarchy was not always practiced in harmful ways (Aycan, Schyns, Sun, Felfe, & Saher, Reference Aycan, Schyns, Sun, Felfe and Saher2013). However, the neoliberal turn witnessed radical changes in leadership culture. Ozbilgin, Küçükaltan and Açar (Reference Özbilgin, Küçükaltan and Açar2019)revealed that fealty, that is, subservience to authority, emerged as a toxic leadership demand from followers. Similarly, in other sites of the public sector, Ozbilgin, Küçükaltan and Açar (Reference Özbilgin, Küçükaltan and Açar2019) reported that ingratiationand sucking up behaviors emerged as unchallenged toxic leadership behaviors. Overall, in the period of neoliberal expansion, Erbil and Özbilgin (Reference Erbil and Özbilgin2023) and Camgoz, Karapinar, Ekmekci, Orta, and Ozbilgin (Reference Camgoz, Karapinar, Ekmekci, Orta and Ozbilgin2023) note that worker silence in the face of declining working conditions is endorsed and brutally enforced through toxic leadership practices.
Referring to the government’s transformation efforts in the healthcare sector, ‘Turkey is an interesting country to study the policy issues surrounding the marketization of healthcare services and managerial reforms in the context of development’ (Agartan, Reference Agartan2012, p. 457). Regardless of whether it is a public or private entity, we believe that the primary goal of healthcare institutions should be to sustain the maximum benefit for the individuals, personnel, and patients. Therefore, in this paper, we show how a favorable ethical climate can weaken the impact of managerialism on toxic leadership behaviors in the healthcare sector.
Methods
Sample and data collection
The study’s sample consists of medical doctors working in 207 public and private university hospitals listed on the Higher Education Council of Turkey website. Many public and private hospitals are associated with a university medical school in the health sector (Aksoylu & Cavmak, Reference Aksoylu and Cavmak2023). University hospitals constitute nearly 31% of the country’s healthcare sector, with state hospitals holding approximately 58% of the market (Kalanlar, Reference Kalanlar2018). The Ministry of Health did not allow researchers to conduct the study on the state hospitals; thus, we approached the university hospitals, the second largest healthcare group in the health system. University hospitals must be approved and registered by the Higher Education Council of Turkey by law. We contacted all university hospitals, yet only 45 hospitals accepted to participate in the study, and the number of doctors employed by these hospitals has been our target population. We reached the contact information of all 1,800 doctors working for the selected 45 universities from Turkey Doctor’s Guide (https://www.turkiyedoktorlari.com/). We sent online questionnaires to them over 5 months (between March and July 2022) and obtained 462 out of 1,800 questionnaires, yielding a response rate of 25.6%. We excluded six unusable ones and continued with 456 questionnaires. Healthcare organizations only allow online surveys due to ethical rules that govern access to hospitals by non-patients and researchers. We could not conduct a pen-and-paper survey at the time.
Measurement instruments
We asked about the age, gender, and workplaces of the participants in the first section. We were only allowed to collect age and gender as demographic information. In order to control all effects that may emerge from age and gender differences, we controlled them in our analysis (Deeks, Lombard, Michelmore, & Teede, Reference Deeks, Lombard, Michelmore and Teede2009). The participants’ ages varied between 27 and 63. The sample description of the study indicates that male respondents comprised 44.1% and females 55.9% of the sample. While 57% of the respondents worked at universities and 25.1% at hospitals, 17.9% worked at universities and hospitals. In order to eliminate whatever their effects were, we controlled age and gender in the study. The composition of the sample is illustrated in Table 1.
Demographic information of the participants
The second section assessed managerialism using Smeenk, Teelken, Eisinga, and Doorewaard’s (Reference Smeenk, Teelken, Eisinga and Doorewaard2009) 7-item managerialism questionnaire. Ethical climate was measured by Victor and Cullen’s (Reference Victor and Cullen1988) 36-item Ethical Climate Questionnaire, which was previously translated into Turkish in the study by Bulutlar and Öz (Reference Bulutlar and Öz2009). Finally, toxic leadership was assessed by Schmidt’s (Reference Schmidt2008) 30-item questionnaire. Therefore, our questionnaire included 76 items (with demographics) in total. All responses to three scales were recorded on a 5-point Likert-type scale. A preliminary survey was conducted to validate the questionnaires further.
Validity and reliability
We carried out a pilot study with 30 participants to assess the validity of our survey. Our initial analysis showed that the participants clearly understood the questionnaire items; thus, we continued our study. We conducted exploratory factor analysis using varimax rotation to determine factors with eigenvalues of at least one to obtain conveniently interpreted factor loadings of each measurement instrument. Furthermore, each measurement item’s internal consistency reliability and convergent and discriminant validity were computed. We have confirmed the factors’ reliability, considering an acceptable α value above 0.60, which is reliable in social sciences (Hair, Black, Babin, & Anderson, Reference Hair, Black, Babin and Anderson2010). Average variance extracted (AVE) values are computed to measure the convergent validity between factor structures. As Fornell and Larcker (Reference Fornell and Larcker1981) suggested, if AVE is less than the 0.50 threshold but composite reliability (CR) is higher than 0.60, then the convergent validity of the construct is adequate.
In the managerialism scale, all items with factor loadings equal to or more than 0.50 were loaded under one factor as expected (KMO = 0.740, approx. chi-square: 635.508, df: 15; p < .001). However, the principal component analysis of the ethical climate scale (Victor & Cullen, Reference Victor and Cullen1988) yielded four factors instead of five as in the original scale (KMO = 0.883, approx. chi-square: 4430.140, df: 231; p < .001). These four factors explained 58% of the total variance. The items of the rules ethical climate and the law and code ethical climate were loaded on the same factor. Therefore, we combined the two factors, called ‘law and rules’, and continued our analysis with four dimensions. Moreover, we had to drop five items since they had factor loadings of less than 0.50 or were loaded with more than one factor.
One explanation for these results might be that people tend not to obey rules as long as they are not enacted by law in Turkey. The participants might not discern the barely visible meaning differences between the items of the rules of ethical climate and the law and code of ethical climate. So, we suggest that the difference from the original scale’s factor structure may be attributed to the participants’ perceptions.
The exploratory factor analysis yielded three toxic leadership factors (KMO = 0.961, approx. chi-square: 10534.936, df: 231; p < .001). We named the factors temperamental abusive, self-promotion, and authoritative behavior as they exist in the extant literature (Schmidt, Reference Schmidt2015). We have removed four items due to factor loadings below 0.50 and cross-loadings. The instrument explained 76% of the variance in toxic leadership. The reliability of all measurement scales, Cronbach’s α values, AVE, and CR of the study are presented in Table 2.
Factor analysis results
Note: Varimax principal component factor analysis.
All measurement items had acceptable reliability since each alpha value was equal to or higher than 0.60 and above (Hair, Hollingsworth, Randolph, & Chong, Reference Hair, Hollingsworth, Randolph and Chong2017). The Cronbach’s α calculated for the reliability analysis of managerialism, ethical climate and its sub-components, and toxic leadership showed the values were equal to or higher than the 0.70 threshold. Therefore, the internal consistency and reliability of the measurement scales were addressed in this study. Although AVE values for ethical climate sub-dimension structures were slightly higher than the commonly accepted 0.50 threshold, CR values were over 0.60. All factors had values AVE > 0.50 and CR > 0.60; thus, convergent validity was also addressed. We have performed the Harman single-factor test to assess the study’s common method variance. The Harman single-factor test requires loading all the items utilized in the study into an exploratory factor analysis to assess the existence of common method variance. The total variance extracted by one factor explained was 34.31%, below the recommended threshold value of 50%.
Multicollinearity
Multicollinearity refers to ‘the existence of highly correlated explanatory variables that may predict each other and undermine the statistical significance and accuracy of the regression model’ (Hair et al., Reference Hair, Hollingsworth, Randolph and Chong2017, p. 451). Therefore, we performed a bivariate correlation analysis to identify the inter-correlations between all variables. The correlation analysis showed no unacceptable level of correlation higher than 0.80 between variables (Sekaran & Bougie, Reference Sekaran and Bougie2013). The variable’s variance inflation factor scores were also calculated. All variance inflation factor scores were below 3; hence, no multicollinearity problem was observed in the model (Kothari, Reference Kothari2015). Inter-item correlations, variance inflation factor scores, and AVE scores are presented in Table 3.
The inter-item correlation results
Non-diagonal value: Correlation. Diagonal value: AVE for the constructs (in parentheses). Sub-dimensions are shown in italics.
* Correlation is significant at the 0.01 level (two-tailed).
** Correlation is significant at the 0.05 level (two-tailed).
Analyses
We tested the relationship between managerialism and toxic leadership through the hierarchical regression method. In model 1, no significant relationship was found between the control variables and toxic leadership. In model 2, we entered managerialism. The results (see Table 4) show a positive and significant relationship between managerialism and toxic leadership (β = 0.494, p < .001). Thus, Hypothesis 1 is supported.
The results of regression analyses and the moderating effects
** p < .05, ***p < .001 (two-tailed).
The moderation effects were tested by Hayes PROCESS (2013) macro for SPSS. We mean-centered the variables before assessing all the relationships in our moderated model and reducing the potential multicollinearity (Aiken & West, Reference Aiken and West1991). Simple slopes for the association between managerialism and toxic leadership were tested for low (−1 SD below the mean), moderate (mean), and high (+1 SD above the mean) levels of each ethical climate sub-dimension.
We entered the interaction term (CR × MAN) on toxic leadership in model 3. The negative and significant relationship between caring ethical climate and managerialism (β = −0.106, p < .001) weakened the managerialism and toxic leadership relationship by decreasing the beta value from 0.494 to 0.437. Therefore, Hypothesis 2a is supported.
We plotted the outcome one standard deviation above and below the mean (β = −0.106, 95% CI = −0.39 to −0.21, p < .001). The slope analysis (Fig. 2) shows that as the level of caring climate increases, the strength of the relationship between managerialism and toxic leadership weakens. For Hypothesis 2b and Hypothesis 2c, the result demonstrates that the impact of the interaction (LR × MAN) on toxic leadership was insignificant (β = 0.072, p = .20). Thus, Hypothesis 2b and Hypothesis 2c are not supported.
The interaction effect of caring ethical climate and managerialism on toxic leadership.
Concerning Hypothesis 2d, the interaction effect of independence ethical climate and managerialism (IND × MAN) on toxic leadership was negative and significant (β = −0.089, p < .05). Figure 3 illustrates that the positive relationship between managerialism and toxic leadership was less pronounced when the independence ethical climate was high (β = −0.089, 95% CI = −0.16 to −0.02, p < .05). It can be concluded that the independence ethical climate partially moderates the effect of managerialism on toxic leadership. Hence, Hypothesis 2d is partially supported.
The interaction effect of independence ethical climate and managerialism on toxic leadership.
About Hypothesis 2e, the interaction effect of instrumental ethical climate and managerialism (INST × MAN) on toxic leadership was positive and significant (β = 0.118, p < .05). Figure 4 indicates that the slope at high levels of instrumental ethical climate significantly moderates the association between managerialism and toxic leadership and strengthens the relationship (β = 0.118, 95% CI = 0.01–0.21, p < .05). Thus, Hypothesis 2e is supported.
The interaction effect of instrumental ethical climate and managerialism on toxic leadership.
In our exploratory factor analysis, the toxic leadership construct yielded three sub-dimensions: temperamental abusive, self-promotion, and authoritative behavior. We conducted a second-order analysis to have more detailed insights into how the interaction of managerialism and each type of ethical climate manifests on toxic leadership sub-dimensions. In the model a, we included the control variables, no significant relationships between the control variables and toxic leadership dimensions were found (Table 5).
The results of regression analyses and the moderating effects
TA: temperamental abusive; SP: self-promotion; AUTH: authoritative.
** p < .05, ***p < .001 (two-tailed).
In model b, we found positive associations between managerialism and all toxic leadership dimensions: temperamental abusive (β = 0.460, p < .001), self-promotion (β = 0.185, p < .001), and authoritative behavior (β = 0.217, p < .001). These findings strengthened our findings that resulted in fully supporting Hypothesis 1.
In model c, the interactions of managerialism and different ethical climates were regressed on toxic leadership dimensions. Negative and significant moderating effects of caring ethical climate on the relationships between managerialism and temperamental abusive behavior (β = −0.170, p < .05), and authoritative behavior (β = −0.108, p < .05) were found. However, test results yielded an insignificant moderating effect of caring ethical climate on the relationship between managerialism and self-promotion behavior. The interaction effect graph (Fig. 5) shows that when a higher caring ethical climate exists, the impact of managerialism on temperamental abusive behavior weakens (β = −0.170, 95% CI = −0.29 to −0.04, p < .05). Similarly, Fig. 6 presents that the effect of managerialism on authoritative behavior is significantly stronger in a situation where a low caring ethical climate exists (β = −0.108, 95% CI = −0.22 to −0.01, p < .05). Thus, in an organization with a high level of caring ethical climate, the impact of managerialism on authoritative behavior significantly weakens.
The interaction effect of caring ethical climate and managerialism on temperamental abusive behavior.
The interaction effect of caring ethical climate and managerialism on authoritative behavior.
Although no moderation effect of law and rule ethical climate was found, we have proceeded to test any interaction effect on the toxic leadership sub-dimensions. The interaction variable’s positive and significant moderation effect on the relationship between managerialism and authoritative behavior (β = 0.158, p < .001) was found. Figure 7 shows that law and rule ethical climate interaction strengthens the positive relationship between managerialism and authoritative behavior (β = 0.158, 99% CI = 0.03–0.28, p < .001).
The interaction effect of law and rule ethical climate and managerialism on authoritative behavior.
The moderation test showed a significant and negative interaction effect of independence ethical climate and managerialism on only temperamental abusive behavior (β = −0.128, p < .05). Figure 8 presents that independence ethical climate significantly decreases the relationship between managerialism and temperamental abusive behavior (β = −0.128, 95% CI = −0.23 to −0.02, p < .05).
The interaction effect of independence ethical climate and managerialism on temperamental abusive behavior.
Finally, the moderation test found a significant and positive interaction effect of instrumental ethical climate and managerialism on only temperamental abusive behavior (β = 0.200, p < .001). Figure 9 depicts that the instrumental ethical climate interaction strengthens managerialism’s impact on temperamental abusive behavior (β = 0.200, 99% CI = 0.08–0.31, p < .001).
The interaction effect of instrumental ethical climate and managerialism on authoritative behavior.
Discussion
We found a significant positive relationship between managerialism and toxic leadership (Hypothesis 1). Thus, applying neoliberal policies and private sector principles and practices to the healthcare sector seemed to lead to the emergence of toxic behaviors by corporate leaders and top managers. Our findings corroborate the previous research (e.g., By, Diefenbach, & Klarner, Reference By, Diefenbach and Klarner2008), suggesting that in a context where managerialism ideology is prevalent, serious negative consequences that emerge from the toxic behaviors of managers or board members can be seen. A more detailed investigation showed that managerialism had associations with all three categories of toxic leadership behavior, which were determined as temperamental abusive, self-promotion, and authoritative behavior (Schmidt, Reference Schmidt2015). Managerialism significantly impacted each aspect of toxic leadership, and our first hypothesis was fully supported. The association between managerialism and temperamental abusive behavior was the strongest. This association can be attributed to the audit culture in managerialism that corporate leaders might exploit to support their career enhancements. Furthermore, the pressure and stress carried by corporate leaders to address higher profit expectations of organizations might create additional room for organizational psychopathic behaviors. Managerialism and toxic leadership in the forms of authoritative behaviors were also associated. Corporate leaders might employ the principles and ethos of managerialism that ‘enhance the role and importance of the manager for political and short-term decision-making’ (By et al., Reference By, Diefenbach and Klarner2008, p. 22). The superior managerial power coupled with further centralization, formalization and bureaucratization might create an environment that encourages leaders to more toxic authoritative and despotic behaviors.
In contrast to our expectations, managerialism exhibited a modest effect on self-promotion behavior. Self-promotion, the typical behavior of a toxic leader, is viewed as attributing success to oneself while blaming others for failure (Schmidt, Reference Schmidt2015). This finding implies that managerialism may have a weaker impact on leaders’ ability to implement impression management in a high power distance culture like Turkey (Hofstede, Reference Hofstede2021). In organizational contexts like Turkey, where a high power distance culture is prevalent, the impression on employees can be created through corporate leaders’ titles and positions. Therefore, corporate leaders may prefer presenting themselves as supportive leaders to get more credit, particularly in sectors such as healthcare, where highly educated people are employed. Nevertheless, they may go for their veiled rent-seeking objectives through cronyism. Cronyism refers to ‘favoritism shown to friends and associates by appointing them to positions without regard for their qualifications’ (Princeton University, 2007). In addition to nepotism, cronyism is the most dominant tool used by the administration in Turkey to control and obtain advantages from public and private institutions and firms in sectors, that is, education, healthcare, media, construction, telecommunication, and transportation (Karakose, Reference Karakose2014; Kimya, Reference Kimya2019). The appointment of people to key managerial positions based on haunted relationships such as a religious high school or childhood friendship with a political leader or a party member, personal history or loyalty with no necessary skill and experience for the managerial post became the usual promotion method in the country (Kamasak, James, & Yavuz, Reference Kamasak, James and Yavuz2019a; Kamasak, Yavuz, & Akin, Reference Kamasak, Yavuz and Akin2019b).
Furthermore, this finding can be explained through the collectivist characteristics of Turkish culture, which significantly emphasizes intragroup ties. Collectivist cultures are characterized by conformity to societal norms and social environment and value social desirability (Cialdini & Goldstein, Reference Cialdini and Goldstein2004; White & Lehman, Reference White and Lehman2005). As self-promotion behavior is driven by the desire to be normatively appropriate, individuals who demonstrate collective orientation engage in high receptiveness to external cues and a heightened need to ‘fit in’ and public self-consciousness. Thus, self-promotion behavior might be suppressed even under a managerialist context.
In relation to our second hypothesis (Hypothesis 2a, b, c, d, e), we found that each ethical climate impacts the relationship between managerialism and toxic leadership idiosyncratically. Regarding Hypothesis 2a, caring ethical climate is observed to have negative and significant moderating effects on the relationships between managerialism and temperamental abusive and authoritative behavior. In contrast, it does not affect self-promotion behavior. We found that toxic leaders blame employees for mistakes and failure. They may either take all the credit for success for themselves or for their employees who are in nepotistic or cronyistic relations with them (which seems to be the situation in our study). This kind of treatment may undermine, seduce, demoralize, and trigger the main fears of other employees who are not in a loop relationship (Lipman-Blumen, Reference Lipman-Blumen2005; Tu, Lu, Choi, & Guo, Reference Tu, Lu, Choi and Guo2019). Yet, the predominance of a caring ethical climate which emphasizes a non-egoistic way of thinking, benevolence, and critical concern for the well-being of others (Martin & Cullen, Reference Martin and Cullen2006) might significantly diminish the emergence of temperamental abusive behaviors.
Concerning Hypothesis 2b and Hypothesis 2c, our analyses reveal that rules ethical climate and law and codes ethical climate are interpreted as one observed construct, so we combined Hypothesis 2b and Hypothesis 2c. We termed the construct as law and rules ethical climate, which did not moderate the relationship between managerialism and toxic leadership. Karasu (Reference Karasu2014) suggests that the overwhelming weight of the patriarchal state can be observed in Turkey’s dominant legal culture. The author, who mentioned the difference between state of law and state of code, suggests that the most important issue in a state of law is principles, whereas the state of code depends on the circumstances. In a state of law, the individuals and their well-being are important, whereas in a state of code, the administrators and their orders and statements constitute the basis for laws. There is no concern for equality in that state, but nepotism and cronyism are prominent (Karasu, Reference Karasu2014). Karasu (Reference Karasu2014) also underlines that laws in Turkey can be breached via presidential decrees. The rules may contradict laws, but laws can be changed by a decree from a superior power so that the illegal rule may become legal afterward. So, one explanation for this result might be that in high power distance cultures like Turkey (Hofstede, Reference Hofstede2021), the rules set by the managers can be perceived as equivalent to the law and codes, and Turkish employees might not differentiate the rules imposed by the company and the obligations of laws.
The results relating to Hypothesis 2d showed that a dominant independence ethical climate weakened the association between managerialism and toxic leadership emerging from temperamental abusive behaviors in the healthcare sector. Finally, the moderation test about Hypothesis 2e found a significant and positive interaction effect of instrumental ethical climate and managerialism on temperamental abusive behavior, yet no significant moderating effect was observed on the other two dimensions, self-promotion, and authoritative behaviors. Moreover, these toxic leaders mostly exhibit temperamental abusive behaviors rather than self-promotion. As we have explained above, in Turkey, leaders may use nepotism and cronyism as tools to gain several advantages due to their rampant incompetence. Authoritative behavior is taken for granted because of the high power distance (66%) observed in national culture (Hofstede, Reference Hofstede2021).
Conclusion
Theoretically, our findings support Stiglitz’s theorization of detrimental consequences of untamed neoliberalism and extend his theorization to show how managerialism, as the dominant managerial paradigm of the neoliberal ideology, entrenches toxic leadership behaviors. This is particularly interesting in the Turkish context, where neoliberalism has been introduced and entrenched with the full force of the state that suppressed opposition to this transformation in the public sector.
Having examined the emergence of toxic leadership behaviors in Turkey’s healthcare sector, we explored managerialism’s role and four distinctive ethical climate types. First, we found that toxic leaders who are ‘adroit at manipulating conversations to subjects they want to talk about’ (Boddy, Reference Boddy2006, p. 1461) might convince employees of their personal agenda in a caring ethical climate where employees are benevolent and indulgent. This atmosphere might help toxic leaders use authoritative behaviors on employees who are ready to obey every order without questioning and make employees blame themselves for any failure they face.
Second, Schmidt (Reference Schmidt2015) argues that toxic leaders do not conform to laws and rules. Against the no-moderation impact of law and rule ethical climate on the relationship between managerialism and toxic leadership as a whole, we found that law and rule ethical climate strengthened the impact of managerialism on the emergence of one sub-dimension of toxic leadership; authoritative behaviors. We suggest that the dominant law and rule ethical climate might help corporate leaders refer to even stricter rules, regulations, procedures, codes, and laws to legitimize their authoritative behaviors.
Third, consistent with the extant literature, under the conditions of an independence ethical climate, the impact of toxic leaders in exploiting their managerial power and maltreating their employees (Reyhanoğlu & Akın, Reference Reyhanoğlu and Akın2016) diminishes due to decision-making by workers on the grounds of personal moral convictions (Feldhaus et al., Reference Feldhaus, Chatterjee, Clarke-Deelder, Brenzel, Resch and Bossert2023; Martin & Cullen, Reference Martin and Cullen2006).
Lastly, when the ethical climate is instrumental, there is a moderating impact because of the locus of analysis is individual and the ethical criteria are egoism (Victor & Cullen, Reference Victor and Cullen1993). Temperamental abusive behavior such as publicly humiliating employees by recalling their past inadequacies, deliberately undermining, seducing, and demoralizing (Schmidt, Reference Schmidt2015) directly affects the employees, and this kind of behavior might be perceived as an intrusion into their personal boundaries.
Therefore, we show that the ethical climate is germane to serve as a managerial intervention site as its varied forms moderate the relationship between managerialism and toxic leadership behaviors.
Managerial implications
Neoliberalism in the healthcare sector entrenches managerialism, leading to toxic leadership behaviors. Organizations and leaders could be held responsible and accountable in the healthcare sector through laws, policies, and discourses to reduce and tackle toxic behaviors. Our study also shows the significance of the ethical climate in moderating the relationship between managerialism and toxic leadership in the sector. An ethical climate could be fostered through organizational interventions of ethics and compliance education and training. The healthcare sector is a complex system with interrelated, interdependent layers of subsystems. Thus, managing such a structure necessitates orchestrated efforts to attain predetermined organizational performance.
However, managers may prefer a top-down approach characterized by cascading and implementing tightly controlled processes within this complexity since the prevalent logic is the market orientation for many healthcare institutions. However, this kind of top-down managerialism style brings more administrative tasks and bureaucratic procedures that compel healthcare workers to have less time to do their real jobs. Therefore, flat organizational structures, including less hierarchy, can be more suitable for healthcare institutions. Managerialist orientation has encouraged focusing on audit culture, market value, and short-term decision-making, resulting in toxic behaviors at healthcare institutions (Ervasti et al., Reference Ervasti, Pentti, Seppälä, Ropponen, Virtanen, Elovainio, Chandola, Kivimäki and Airaksinen2023; Carlisle, Reference Carlisle2011). Yet, poor treatment of staff leads to less commitment, a demoralized workforce and poor staff retention.
The policymakers should refrain from following cronyism and nepotism while appointing managers to key positions in healthcare institutions. The appointment of skilled and qualified managers who can empower the healthcare workforce and establish a caring ethical climate that offers benevolent, rewarding, and motivating working conditions should be prioritized.
Limitations and further research suggestions
This paper is based on a cross-sectional research design, and it is not possible to draw strong causal inferences related to the relationships between the variables. Although thorough theoretical and logical reasons for causality are presented, alternative causal models are needed to support the results. Therefore, longitudinal research designs may be studied in future research. As the research was conducted in only one country, cultural interferences were not controlled, therefore an international study design may be more rigorous and provide more information for both researchers and practitioners. The sample size is another limitation of the paper. Since the state hospitals did not allow us to conduct such a study, we focused on the university hospitals.
Moreover, we investigated three variables with multiple sub-dimensions each, the measurement instrument is relatively long, which in turn caused a low return rate of 25.6%. When we started distributing the questionnaires, the COVID-19 pandemic was still seriously affecting people. Therefore, the doctors had an overwhelming workload, causing them to be reluctant to save time to fill out a lengthy questionnaire. Another limitation is that we only asked for respondents’ perceptions. It would have been better if we had supported our findings with the help of qualitative techniques and in-depth analyses, however, the workload of our sample was a severe impediment to doing this kind of research.
According to World Economic Outlook (2022), global economic activity is experiencing a serious, unexpected slowdown and high inflation rates. Due to crises like the COVID-19 pandemic and Russia’s invasion of Ukraine, global growth, which was 6.0% in 2021, is expected to slow down to 3.2% in 2022 and 2.7% in 2023.
As a result of these severe economic conditions worldwide, focus on market value, efficiency, and costs may be more prevalent, resulting in managerialism. As this study has found a significant relationship between managerialism and toxic leadership, conducting similar studies in different countries will be helpful for organizations in preventing the emergence of toxic leaders by supporting the findings of this research. Furthermore, as there is limited literature on managerialism and toxic leadership, similar studies will benefit further conceptualizations of these variables.
Conflicts of interest
The authors whose names are listed above certify that they have NO affiliations with or involvement in any organization or entity with any financial interest (such as honoraria; educational grants; participation in speakers’ bureaus; membership, employment, consultancies, stock ownership, or other equity interest; and expert testimony or patent-licensing arrangements) or non-financial interest (such as personal or professional relationships, affiliations, knowledge, or beliefs) in the subject matter or materials discussed in this manuscript.
Ethical standards
The authors whose names are listed above ensure objectivity and transparency in this manuscript and certify that accepted principles of ethical and professional conduct have been followed. The research have been performed in accordance with the ethical standards of the Yeditepe University Social Sciences Research Ethics Committee and obtained formal approval (Documentation number: 21568116-302.14.01-E.679).
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