This study aims to theoretically discuss and empirically test the mediating mechanism of psychological distress and the moderating effects of Islamic work ethics (IWE) in the relationship between despotic leadership and adaptive performance.
A three-wave survey was used to gather the data from middle managers and their supervisors of construction firms in Pakistan. The final sample consisted of 304 respondents and data analysis was performed through SEM analysis.
Despotic leadership enhances employees’ psychological distress which results in a negative impact on adaptive performance. In addition, IWE played a buffering role in mitigating the harmful impacts of despotic leadership on adaptive performance.
The study is among the pioneers that have investigated how despotic leadership impacts employees’ adaptive performance via the underlying mechanism of psychological distress through the conservation of resources and social exchange theory lens.
