Transformational Leadership and Employee Loyalty: The Mediating Mechanism of Job Satisfaction

Abstract:

Transformational leadership, with its ability to inspire, encourage creativity, and foster individual potential, has been shown to have a positive impact on employee satisfaction and loyalty. This study aims to evaluate the direct impact of the components of transformational leadership on job satisfaction and employee loyalty, while also identifying the mediating role of job satisfaction in this relationship. The research surveyed 300 valid responses from employees working in Ho Chi Minh City. Data analysis was conducted using SPSS and SmartPLS, including tests for reliability, convergent validity, discriminant validity, and structural model evaluation. The results show that all five components of transformational leadership positively affect both satisfaction and loyalty. Job satisfaction has the strongest impact on loyalty and plays a significant mediating role. This study provides updated empirical evidence within the Vietnamese context, clarifying the mechanism through which transformational leadership influences employee loyalty via job satisfaction.