LEADERSHIP STYLE, EMPLOYEE TRUST, INFORMATION CULTURE AND ORGANIZATIONAL PERFORMANCE OF STOCK BROKING FIRMS IN NIGERIA
ABSTRACT
Stockbroking firms play a fundamental role in a country’s capital market system. The performance of stockbroking firms is generally perceived as low by their customers. It was therefore, necessary to find out the extent to which this was true and the role played by organizational characteristics such as leadership style, employee trust, and information culture. It is in light of this that the study examined how leadership style, employee trust and information culture contributed to the performance level of stockbroking firms in Nigeria.
The survey design was used. The target population consisted of 1,222 employees from 184 stockbroking firms in Nigeria. Proportionate stratified sampling technique was used to select 606 employees from 94 stockbroking firms. A validated questionnaire was the instrument used for data collection. Reliability coefficient of each of the variables ranged from 0.74 to 0.89. Response rate was 85%. The data were analysed using descriptive statistics and regression.
The study showed a significant influence of leadership style on organizational performance = .178; p < 0.05); likewise, employee trust showed a significant influence on organizational performance = .156; p < 0.05) and information culture also showed a significant influence on organizational performance ( = .190; p < 0.05). The combined influence of leadership style, employee trust and information culture on organizational performance was significant = .193, F(3,511) = 41.88, p < 0.05). The isolated influence of positive intention as an indicator of employee trust on organizational performance was not significant (β = 0.380; t = 0.879; p > 0.05). Likewise, information sharing (β = 0.001; t = 0.017; p > 0.05) information transparency (β = 0.027; t = 0.534; p > 0.05) and information control (β = -0.094; t = -1.960; p < 0.05) as indicators of information culture did not contribute significantly to organizational performance of stockbroking firms in Nigeria.
The study concluded that factors such as leadership style, employee trust, and information culture contributed to the low performance of stockbroking firms in Nigeria. It recommended that in order for stockbroking firms to perform optimally, the Nigerian Stock Exchange and Security and Exchange Commission should orientate managers of stockbroking firms on the need to be transformational in leadership style display, encourage teamwork and allow their employees to be innovative and improve on their organizational information culture.
Keywords: Leadership style, Transactional leadership, Transformational leadership, Employee trust, Information culture, Organizational performance, Stockbroking firms