unlicensed the role of ethics institutionalization in influencing quality of work life and job satisfaction a study in vietnamese petroleu

Regarding the importance of ethics and quality of work life and the effect of them on job consequences such a job satisfaction of employee and spirit of team work, Chamesghali and Salimi

Acknowledgement

I would like to express my sincere thankfulness to my supervisor, Dr Nguyen Thi Nguyet Que, who made me believe in myself and gave me the possibility to complete the thesis Her guidance helped me in all the time of research and writing this thesis I

am sure that this thesis would not have been possible without her support

I would like to express my gratitude to all staffs in ISB who supported necessary materials and helped submit my papers

My sincere thanks also go to friends and colleagues who participated in the pilot study that led to the development of the final survey questionnaire and their support over the time when I was busy to conduct the research

Especially, I would like to give my special thanks my family for supporting me spiritually throughout my life

Pham Nhu Huynh

February 2017

Abstract

Purpose – This research aims to explore the role of ethics institutionalization in

influencing quality of work life and job satisfaction – A study in Vietnamese Petroleum Industry

Methodoldy/Sample – A total of 280 questionnaires were distributed out at many oil

and gas companies in Vietnam As the method is directly interviewing combining with online surveying, all of respondents who working at petroleum companies (e.g., staffs, team leaders, line managers and top managers), thus, data collecting also was primary sources The hypothesized relationships were tested using structure modeling

Findings – This research found that a positive relationship between implicit ethics

institutionalization and quality of work life The results also indicate that implicit ethics institutionalization and quality of work life have positive impacts on the job satisfaction of employees

Key words – Ethics institutionalization, quality of work life, job satisfaction

Contents

Acknowledgement i

Abstract ii

Contents iii

List of figures v

List of tables vi

List of abbreviations vii

CHAPTER 1 INTRODUCTION 1

1.1 Research background 1

1.2 Research problem 3

1.3 Research objectives 7

1.4 Research scope 7

1.5 Research significance 7

1.6 Research structure 8

CHAPTER 2 LITERATURE REVIEW 9

2.1 Job satisfaction 9

2.2 Quality of work life 10

2.3 Ethics institutionalization and Quality of work life 14

2.4 Ethics institutionalization & Job satisfaction 17

2.5 Research model and hypothesis 19

CHAPTER 3 RESEARCH METHODOLOGY 20

3.1 The research design 20

3.1.1 Pilot study 20

3.1.2 Main survey method 21

3.2 Measurement scale building 23

3.3 Sample size and sample method 26

3.4 Data analysis method 27

CHAPTER 4 DATA ANALYSIS AND RESULTS 30

4.1 Data collection 30

4.2 Respondents’ demographic 30

4.3 Reliability analysis 32

4.4 Exploratory factor analysis (EFA) 34

4.5 Confirmatory factor analysis (CFA) 35

4.5.1 Model fit 35

4.5.2 Reliability and validity check 38

4.6 Structure equation modeling (SEM) 40

4.7 Summary 43

CHAPTER 5 CONCLUSION 44

5.1 Conclusions and discuss of the findings 44

5.2 Managerial implications 46

5.3 Limitations and future research 48

REFERENCES 49

APPENDICES 55

Appendix 1 – Guidelines for in-depth interview 55

Appendix 2 – Questionnaire (English version) 59

Appendix 3 – Questionnaire (Vietnamese version) 63

Appendix 4 – Frequencies Table 67

Appendix 5 – Reliability results 69

Appendix 6 – EFA results 73

Appendix 7 – CFA results 75

Appendix 8 – SEM results 77

List of figures

Figure 2.1 – Conceptual model - 19

Figure 3.1 – Research process - 22

Figure 4.1 – Confirmatory factor analysis model - 37

Figure 4.2 – SEM of research model - 41

Figure 4.3 – Final research model - 42

List of tables

Table 3.1 – Measurement scale - 24

Table 3.2 – Key indices - 29

Table 4.1 – Sources of data collection - 30

Table 4.2 – Description of sample - 31

Table 4.3 – Reliability test results - 32

Table 4.4 – The list of deleted items - 33

Table 4.5 – KMO and Bartlett's Test - 34

Table 4.6 – Pattern Matrix - 34

Table 4.7 – Standardized Regression Weights - 36

Table 4.8 – Confirmatory factor analysis results - 38

Table 4.9 – Construct correlations, AVE & CR - 39

Table 4.10 – Fitness of conceptualized model - 40

Table 4.11 – Final results of hypotheses testing result - 42

Table 4.12 – Final results of relationship checking of model’s constructs - 43

Table 4.13 – Modified scales - 43

List of abbreviations

1 AVE Average Variance Extracted

2 CFA Confirmatory factor analysis

3 CR Composite Reliability

4 EEI Explicit ethics institutionalization

5 EFA Exploratory factor analysis

6 GDP Gross domestic product

7 KNOC Korean National Oil Corporation

8 IEI Implicit ethics institutionalization

9 JS Job satisfaction

10 PetroVietnam Vietnam Nation Oil and Gas Group

11 PVD-DD PetroVietnam Drilling Division

12 PVEP POC PetroVietnam Domestic Exploration Production Operating Company Limited

13 PVD TECH Petroleum Trading & Drilling Technical Services Company

14 QWL Quality of work life

15 SEM Structural equation modeling

CHAPTER 1 INTRODUCTION 1.1 Research background

Each organization has its own assets which contains two main components – labor and capital Capital is so important to the achievement of the business, while labor is the vital factor for creating profits to it The labor does everything daily and the whole existing time of the organization The reality of working life today is that employees are frequently trying to control their work and personal lives

In the context of integration into the world economy, along with the introduction of many domestic petroleum companies and foreign petroleum companies have made the competition attract high-quality human resources to be more intense Therefore, the vital importance which leaders should perform are to retain current employees because the stability of personnel will help organization save time, costs of recruitment, training According to Tett and Meyet (1993), job satisfaction is negatively associated with turnover intention Job satisfaction was associated with decreased intentions to leave a company (Hom & Griffeth, as cited in Valentine et al., 2011; Jaramillo, Mulki & Solomon 2006) Thus, besides the ways to improve business efficiency, management efficiency, cost savings, etc the methods to improve the job satisfaction of employees are the concern of all organization

The job is considered an important part of human life since the majority of their lives is devoted to the organization Many people believe that the work represents their value in society Therefore, the quality of life will depend on the quality of work life which they have been at the workplaces Improving the quality of work life will contribute to bring good quality of life for each individual

Quality of work life including the life aspects related to the work such as wages, working hours, work environment, benefits, career prospects, the human relationship, the balance between work and life These aspects contribute to the satisfaction and motivation of employees According to Efraty, Sirgy and Claiborne (1991), high quality of work life results in an increase in job satisfaction and performance of employees, and at the same time, cause a decrease in both alienation and turnover intention From that, employees are willing to contribute to an

organization where quality of work life exists because they feel that their work fulfills their needs (Cascio, as cited in Koonmee, Singhapakdi, Virakul, and Lee, 2010)

Recent studies have shown that quality of work life is not the unique factor affecting to job satisfaction of employees, the institutionalization of ethics is also considered the important factor influencing to employees’ job satisfaction According

to Sims and Kroeck (1994), ethical working environment is an important factor in the person-organization study That is, employees usually choose to work in organizations whose ethical preferences fit their own And so, employees who work for organizations that institutionalize ethics would tend to be more satisfied with their jobs (Singhapakdi & Vitell, 2007) And finally, Valentine, Godkin, Fleischman, and Kidwell (2011) indicated that corporate ethical values and job satisfaction were associated with decreased turnover intention

Therefore, it is necessary to study the association between institutionalization

of ethics, quality of work life and job satisfaction Because of in parallel to the importance of ethics institutionalization, both quality of work life and job satisfaction have been important topics in human resource and organizational development (Leopold, as cited in Koonmee et al., 2010)

The oil and gas company is a type of specific enterprise, operating in the field

of petroleum exploration and production Its operation and business are conducted through laborers The works at the oil and gas company is considered to be extremely stressful, contain many risks, frequently long working hours, working fully stretched

in harsh environments and often facing danger, be able to occur injury or even dangerous to life Such as explosives, gas eruption, falling into the sea, labor accidents due to work with heavy machinery, etc although safety regulations are very closely

on the rig To work well in the petroleum sector, employees need more skills such as analysis, synthesis, teamwork and have good health Besides, the petroleum sector is the operation field related to exploration and production of natural resources therefore the intelligence is pre-requisite for the employees working there In addition, soft skills are such as presentation, conflict resolution, establishing good relations with colleagues; fast processing unexpected problems occur, etc those are the important skills which staffs need to equip themselve Therefore, when there is an employee

meeting the above requirements, any petroleum company which wishes to maintain existing staff and make them meet the job satisfaction to engage with the organization

in the long-term, especially employees with high technical qualifications The research

of Al Muftah and Lafi (2011) related to petroleum industry in Qatar supports that quality of work life is positively and significantly related to employees’ job satisfaction Regarding the importance of ethics and quality of work life and the effect

of them on job consequences such a job satisfaction of employee and spirit of team work, Chamesghali and Salimiare (2014) considered the relationship between ethics institutionalization, quality of work life and job-related outcomes in the form of case study of employee of national Iranian oil product distribution company

Nowadays, the common problem of the petroleum company is to improve the job satisfaction of employees, creating incentives for employees to work effectively and engage long-term with the organization Therefore, the determination of the degree of influence of the ethics institutionalization and the quality of work life to the job satisfaction of petroleum employees is a necessary matter

1.2 Research problem

For the last decade, organizations have increased effort to institutionalize ethics, partly because such efforts positively affect employee behavior In addition, given increasing ethical problems in business, many organizations have tried to control these problems by institutionalizing ethics Therefore, ethics institutionalization is not only a process developed through continual ethical operation but also an important topic in business ethics research and ethics become institutionalized by “the persistence of specific behaviors associated with an organization and its employees behaving ethically” (Sims, 1991, p 494)

institutionalization within an organization is the utilization of a code of ethics This code describes the general value system of the organization, defines the purpose of the organization, and provides guidelines for decision-making consistent with these principles Ethics institutionalization is a part of the organizational environment, and it

is also an important determinant of the decision-making processes of employees in situations involving ethical issues (Hunt & Vitell, 1986; Ferrell & Gresham, 1985)

Sims (1991) also discusses the important of institutionalizing organizational ethics and emphasizes the importance of an ethically oriented culture to ethics institutionalization within organizations

In recent years, the ethics institutionalization is also an important responsibility for organizations in order to effectively counteract the frequent occurrences of unethical and illegal behavior within organizations An organization can utilize different methods to create an ethical work culture for employees, especially ethical practices can be a powerful tool for enhancing an organization One of methods is to institutionalize ethics in business organizations and Koonmee, Singhapakdi, Virakul, and Lee (2010) emphasized that ethics, quality of work life and job-related outcomes are identified as progressive indicators related to the function and sustainability of business organizations

Much research has expected that people in organizations with a high degree of institutionalization of ethics will be more satisfied with their jobs Such as, Singhapakdi and Vitell (2007, p 287) argue, “organizations that institutionalize ethics appear to value integrity and trust and, as a result, often treat their employees more fairly in terms of compensation, performance evaluation, promotion and conflict resolution” Accordingly, organizations that institutionalize ethics pay attention to the quality of their employees work life will get the advantages of having more committed workforce and more commitment of workforce

Much research has documented that institutionalization of ethics is an important factor affecting various aspects of employees’ job-related outcomes Such

as, Vitell and Davis (1990) found a direct link between job satisfaction and ethical behavior, the organizational culture is a key component when looking at ethical behavior Turban and Greening (1996) investigated the affecting of ethics programs and perceived corporate social responsibility positively on individual work attitudes, namely job satisfaction Vitell and Singhapakdi (2008) investigated the impact of ethics institutionalization on job-related outcomes (job satisfaction, esprit de corps, and organizational commitment) for marketing professionals and revealed that implicit institutionalization is a significant determinant of job satisfaction, but explicit institutionalization is not Kang (2010) investigated the relationship between job

satisfaction and ethical conflict, ethical conflicts causes and consequences of job dissatisfaction and came to the conclusion that many employees confirm the existence

of ethical conflict in their workplace Valentine, Godkin, Fleischman, and Kidwell (2011) examined the degree to which perceived corporate ethical values work in concert with group creativity to influence both job satisfaction and turnover intention, and indicated that corporate ethical values is associated with increased job satisfaction

Much research also has documented that institutionalization of ethics is studied

in various countries with different fields Such as, Koonmee et al (2010) investigated the relationship between institutionalization of ethics, quality of work life and employee job-related outcomes and concluded that implicit institutionalized ethics has

a positive relationship with quality of work life; implicit institutionalized ethics and quality of work life have positive impacts on Thailand staff working results (job satisfaction, team working and organizational commitment) Furthermore, based on the previous research, Marta, Singhapakdi, Lee, Sirgy, Koonmee, and Virakul (2013) examined the perception of institutionalization of ethics and quality of work life for Thailand marketing managers versus American marketing managers, the results showed that the impact of institutionalization of ethics on the quality of work life for Thai managers is more than American managers because Thailand culture is collective, while American culture is individual

In addition, Torlak, Tiltay, Ozkara, and Dogan (2014) analyzed the relationship between institutionalization of ethics and quality of work life by mid-level managers working in the private sector in Turkey and came to the conclusion that implicit institutionalization of ethics is positively related to both higher and lower needs that determine quality of work life Lee, Yu, Sirgy, and Singhapakdi (2015) investigated the effect of ethics institutionalization on employee’s work life experiences (job satisfaction, organizational commitment, spirit de corps, quality of work life) and overall life satisfaction (life satisfaction, employee happiness), data were collected through a survey of marketing managers in Italy, and came to the conclusion that implicit institutionalization of ethics has a positive effect on not only employees’ quality of work life but also job satisfaction

The research of Al Muftah and Lafi (2011) related to petroleum industry in Qatar supports that the physical, psychological and social factors’ centrality have a significant relationship with quality of work life which indirectly impact employees’ satisfaction The finding indicated that quality of work life is positively and significantly related to employees’ job satisfaction Regarding the importance of ethics and quality of work life and the effect of them on optimized performance of an organization and job consequences such a job satisfaction of employee and spirit of team work, Chamesghali and Salimiare (2014) considered the relationship between ethics institutionalization, quality of work life and job-related outcomes in the form of case study of employee of national Iranian oil product distribution company

Reichert, Webb, and Thomas (2000) examined the relationships between ethical and industry type Industries, such as computers, electronics, scientific and photo graphics sectors, that are involved with high precision products and industries; such as mining, crude oil, and petroleum refining, that utilize natural resources are more inclined to have a formal written a code of ethics and social responsibility

Institutionalization of ethics is gaining more and more importance in business life day by day (Torlak et al., 2014) Moreover, the importance of understanding more about the institutionalization of organizational ethics should be apparent because it is really good strategy for a company to concern about and adapt institutionalization of ethics (Purcell & Weber, 1979) However, there are very few studies about this subject

in samples of Vietnam culture Particularly, there have been very few studies on the relationships between ethics institutionalization and quality of work life, and between ethics institutionalization and job satisfaction (Koonmee et al, 2010)

From above discussions, it is necessary to study the association between institutionalization of ethics, quality of work life and job satisfaction Because of in parallel to the importance of ethics institutionalization, both quality of work life and job satisfaction have been important topics in human resource and organizational development (Leopold, as cited in Koonmee et al., 2010) Thus, the main issue of this study is to understand the relationship between institutionalization of ethics, the perception of the quality of work life and job satisfaction of employees in Vietnamese Petroleum Industry in particular and in Vietnam business organization in general

1.3 Research objectives

The main focus of the study is to empirically examine a model that focuses on the effects of ethics institutionalization on employees’ quality of work life and job satisfaction Furthermore, the study also examines the mediating effect of quality of work life on employees’ job satisfaction

Specifically, the study aims to investigate the following relationship:

1 The relationship between quality of work life and job satisfaction

2 The relationship between ethics institutionalization and quality of work life

3 The relationship between ethics institutionalization and job satisfaction

1.4 Research scope

This research focuses on investigating the impact of implicit and explicit ethics institutionalization on employees’ quality of work life and job satisfaction, as well as the mediating effect of quality of work life on job satisfaction of employees in Vietnamese petroleum industry

Almost the oil and gas companies have located in Ho Chi Minh City, Hanoi City and Vung Tau City Moreover, basing on the advantages of communication with the oil and gas company’s authorities, this research may conveniently conduct the survey questionnaire via paper and online in these cities

1.5 Research significance

This research contributes to the understanding of ethics, quality of work life and job satisfaction and especially the important role of institutionalizing ethics, the extent to which its impact on employees’ quality of work life and job satisfaction within the context of Vietnamese business organizations in generally and within Vietnamese petroleum industry in particularly

The findings provide a significant opportunity for managers perceives that some aspects of employees’ quality of work life can have a positive predictive impact

on their job satisfaction Based on this finding, it is very important for business organizational management to design work requirements, build appropriate policy in order to improve employees’ quality of work life, as well as, so that employees can enhance job satisfaction in organization, have a balanced life at work and with family

Chapter 2: Literature Review

This chapter provides the literature review and previous studies, defines clearly the constructs (implicit ethics institutionalization, explicit ethics institutionalization, quality of work life and job satisfaction), and then the research model of the study and the hypothesis are also discussed

Chapter 3: Research Methodology

This chapter describes the method to conduct the study, including the research design, measurement scale building and the main survey The processes of doing the study are also presented

Chapter 4: Data Analysis and Results

All of data collected from the survey are analyzed The final model of the study

is built based on the results of those analyses Depending on output results from the analyzing, the relationship of those factors as mentioned in the study model will be examined

Chapter 5: Conclusion

In this chapter summarizes the main results of this study and give some conclusions for managerial implement as well as limitation for further research

CHAPTER 2 LITERATURE REVIEW

This chapter gives a specific view about the important constructs of the study, presents a discussion of job satisfaction, quality of work life and institutionalization of ethics This is followed by the development of hypothesis and construction of a conceptual model Five hypotheses are also proposed after being argued based on previous researches

2.1 Job satisfaction

An employee’s overall job satisfaction is composed of several aspects such as satisfaction with compensation, satisfaction with top management, satisfaction with promotions and satisfaction with coworkers

According to Spector (1988), job satisfaction is important from two perspectives: first, from the human aspect, employees should be treated fairly and be respected Second, behavioral aspects, attention to job satisfaction could direct the behavior of employees, so that it would affect the performance and organizational responsibilities and lead to positive and negative behavior from them

Thus, job satisfaction is the essential component for employee motivation and encouragement towards better performance Many previous researches have defined job satisfaction over the years For instance, Hoppok and Spielgler (1938) defines job satisfaction as the integrated set of psychological, physiological and environmental conditions that encourage employees to admit that they are satisfied or happy with their jobs Locke (as cited in Valentine et al., 2011, p 6) defines job satisfaction as “a pleasurable or positive emotional state due to appraisal of one’s job experience” Accordingly, once a person feels satisfied, they are willing to participate in work positively and this leads to improve their quality of work life In addition, job satisfaction is also the one attitude that is related to an organization’s ethical context, particularly where there is strong belief that the organization and its leaders truly promote the ethical conduct (Vitell & Davis, 1990)

Much research also has documented that job satisfaction is studied in various relationship within an organization Such as, the relationship between job satisfaction and turnover intention has been evaluated extensively in the organizational literature, and the result generally shows that job satisfaction was associated with decreased

intentions to leave a company (Hom & Griffeth, as cited in Valentine et al., 2011; Jaramillo, Mulki & Solomon 2006); another finding indicates that job satisfaction is negatively associated with turnover intention (Tett & Meyet, 1993) Finally, Valentine

et al (2011) indicated that corporate ethical values and job satisfaction were associated with decreased turnover intention

Much research also has documented that job satisfaction is studied in the human aspect For instance, the motivational factors, such as the nature of work, the sense of achievement, the recognition, the responsibility, and opportunities, that helps employees to find their worth with respect to value given to them by organization (Baah & Amoako, 2011) Further, this can increase motivational level of employees which will ultimately raise internal happiness of employees and the internal happiness will cause satisfaction Thus, the role of employees at workplace is emphasized as there is an influence of various elements on an employee within the organization (Raziq & Maulabakhsh, 2015)

The recent research emphasizes that job satisfaction is a pleasurable or positive emotional state and also the most controversial concepts in organizations Based on the foundational and theoretical efforts, it is very important not only towards employees but also at all levels of management and organizational human resource (Etebarian & Yazdi, 2016) Besides, job satisfaction in an important factor in increasing productivity, sense of belonging towards workplace, increase quantity and quality of work, good human relation at work, raise morale, create interest in the work and reduce stress In contrary, declining in job satisfaction leads to excessive absenteeism, low efficiency, displacement and transfer of employees

Based on the above literature, it is necessary to study the importance of job satisfaction of employees within organizations, especially examining the factors affecting on the job satisfaction

2.2 Quality of work life

In recent years, many business organizations fail to understand the importance

of working environment for employees’ job satisfaction and thus face a lot of difficulties during their work (Aiken, Clarke & Cloane, 2002) Employee is an essential component in the process of achieving the mission and vision of a business

organization Employees should meet the performance criteria set by the organization

to ensure the quality of their work In order to meet the standards of the organization, employees need a working environment that allows them to work freely without problems that may restrain their working performance

In addition, Lawler (as cited in Narehan, Hairunnisa, Norfadzillah & Freziamella, 2014) refers that quality of work life have relationship to job characteristics and working environment because the whole quality of work life in the organization goals is to improve employee’s well-being and support from productivity Thus, the objective of this research is to analyze the impact of working environment as well as quality of work life on employees’ job satisfaction

In over the years, the quality of work life is defined by many researches in the various aspects For instance, Shamir and Solomon (1985) define quality of work life

as a comprehensive construct that includes well-being related to the extent to which work experiences are rewarding, fulfilling, and reduce stress Beukema (as cited in Narehan et al., 2014) refers quality of work life as the extent to which employees are able to configure their jobs in accordance with their options, interests and needs in the organization Walker’s (as cited in Koonmee et al., 2010) definition, quality of work life involves promoting a work environment favorable to the satisfaction of employees' needs And then, Quality of work life is defined as “employee satisfaction with a variety of needs through resources, activities, and outcomes stemming from participation in the workplace” (Sirgy, Efraty, Siegel & Lee, 2001, p 242)

The construct of quality of work life has been defined as the relating to job characteristics and working environment (Lawler, as cited in Narehan et al., 2014), employee’s well-being (Shamir & Solomon, 1985), the options, interests and needs of employees (Beukema, as cited in Narehan et al., 2014), and the satisfaction of employees’ needs (Walker, as cited in Koonmee et al., 2010) To facilitate the discussion that relates quality of work life with job satisfaction, this study will adopt the need satisfaction approach to quality of work life (Sirgy et al., 2001) That is, quality of work life is defined as employee satisfaction with a variety of needs through resources, activities, and outcomes stemming from participation in workplaces

Based on need-hierarchy theory (Maslow, as cited in Koonmee et al., 2010), Sirgy et al (2001, p 241) propose that quality of work life is measured in terms of employees' needs Specifically, seven dimensions of needs are suggested:

a) Health and safety needs (protection from ill health and injury at work and outside of work, and enhancement of good health);

b) Economic and family needs (pay, job security, and other family needs); c) Social needs (collegiality at work and leisure time off work);

d) Esteem needs (recognition and appreciation of work within and outside the organization);

e) Actualization needs (realization of one's potential within the organization and as a professional);

f) Knowledge needs (learning to enhance job and professional skills); and g) Aesthetic needs (creativity at work as well as personal creativity and general aesthetics)

According to their research into different dimensions of need-based quality of work life, Koonmee et al (2010) and Marta et al (2013) categorize quality of wok life into two major categories: lower and higher order needs

Lower-order quality of work life: Lower-order quality of work life is the organizational programs designed to meet the needs related to security, health, family and economic

Higher-order quality of work life: Higher-order quality of work life is the organizational programs designed to meet the needs related to community, self-esteem, self-actualization, knowledge and aesthetics

Why the quality of work life is important? Some studies have shown that quality of work life could affect employees’ behavioral responses such as organizational identification, job satisfaction, job involvement, job effort, job performance, and turnover intention (Etebarian & Yazdi, 2016) Walton (as cited in Narehan et al., 2014) emphasizes that quality of work life was an important approach

to save human and environment values which have been ignored due to technological advancement of the economic growth and productivity Once the employees experience enjoyment in working at an organization, they would feel satisfied and influence their commitment in their daily tasks High quality of work life results in an

increase in job satisfaction and performance of employees, and at the same time, cause

a decrease in both alienation and turnover intention (Efraty, Sirgy & Claiborne, 1991) Furthermore, the quality of work life also has the significant impact to the society A happy employee will experience the positive feeling and this feeling is carried to their family and the society Thus, since today’s life demand is quite stressful, quality work life is important as it contributes to the environment as well as family structure by offering ways to fulfill individuals’ responsibilities (Bagtasos, 2011)

The mainstream research on quality of work life has been linked to employees' job-related outcomes such as productivity, job satisfaction, and employees' commitment For example, the research findings from Lau and May (1998) suggest that companies with high quality of work life can also have high customer satisfaction which, in turn, will provide higher growth and profitability to the companies Greenhaus, Bedeian, and Mossholder (1987) suggested that quality of work life is related to employees’ satisfaction and work related behaviors Cascio (as cited in Koonmee et al., 2010) argues that employees are willing to contribute to an organization where quality of work life exists because they feel that their work fulfills their needs

Moreover, quality of work life involves the opportunity to make decisions about employees' job and the design of their workplaces Consistently, the recent study reveal that quality of work life generally has a positive influence on job satisfaction, organizational commitment, and esprit de corps (Lee, Singhapakdi & Sirgy, 2007) In another study by Koonmee et al (2010), quality of work life mediates the relationship between institutionalization of ethics in firms with job-related outcome

These studies indicate that, once quality of work life programs are presented in

a business organization, employees will feel satisfied towards their job And so, the job satisfaction has a significant relationship with the quality work life

In fact, some experts have raised the quality of work life as a hierarchy of concepts including life satisfaction (on the top of the hierarchy), job satisfaction (in

the middle of the hierarchy) and satisfaction from certain aspects such as pay satisfaction, colleagues, and supervisors (Champoux, 1981)

A large number of employees in the oil & gas companies in Qatar are playing a significant role for economic growth Based on this context, Al Muftah and Lafi (2011) focus on identifying the factors that associated with employees’ satisfaction and their quality of work life More specifically the study is held to identify the relationship between quality of work life and employees’ satisfactions This is especially true as quality of work life is less emphasized in Asia as compared to North America and European countries (Bagtasos, 2011; Wyatt & Wah, 2001) Looking back at Vietnam, Vietnam is also a country in Asia, Vietnam is also developing oil and gas industry, so it is necessary to have a study on the relationship between quality

of work life and job satisfaction

Based on the above discussions, this study aims to expect the quality of work life to have a positive influence on job satisfaction Thus, the hypothesis is proposed

as the following below:

Hypothesis 1 (H1): Quality of work life is positively related to job satisfaction

2.3 Ethics institutionalization and Quality of work life

In recent years, due to increasing ethical problems, many business organizations have established ethics programs to help improve ethical behavior and

to help prevent ethical problems among their employees (Valentine & Fleischman, 2008)

Ethics in this research refers to the rules or standards governing the conduct of individuals or the members of a profession (Morris, as cited in Koonmee et al., 2010)

Andrews (1989, p 99) defines the institutionalization of ethics as “actions needed to map a high road to economic and ethical performance and to mount guardrails to keep corporate wayfarers on track”

Goodman and Dean (as cited in Sims, 1991) referred an institutionalized act as

a behavior that is performed by two more individuals, persists over time, and exists as

a part of the daily functioning of the organization

Singhapakdi and Vitell (2007, p 284) defined the institutionalization of ethics

as “the degree to which an organization explicitly and implicitly incorporates ethics into its decision-making processes”

To make possible the discussion that relates institutionalization of ethics with quality of work life, this study will adapt “institutionalization of ethics” as the degree

to which an organization explicitly and implicitly incorporates ethics into its decision- making processes, a definition by Singhapakdi and Vitell (2007)

According to Brenner (1992), there are two categories of ethics programs in organizations — either explicitly created or implicitly inherited Based on his research, the explicit components include codes of ethics, policy manuals, ethics seminars, internal control systems, and ethics staff The implicit components include corporate culture, incentive systems, valued behaviors, promotion policies, and management behavior

Following Brenner's (1992) explicit and implicit categorization, Singhapakdi and Vitell (2007, p 285) explain that:

Implicit institutionalization ethics means that ethical behavior is implied, or not directly expressed, and is understood to be crucial

Explicit institutionalization of ethics means that ethical behavior is formally expressed without vagueness

According to Sims (1991), institutionalization of ethics should be examined in terms of specific behaviors or acts and it may vary in terms of its persistence, the number of people in the organization behaving according to its ethics, and the degree

to which it exists as part of the organization

When organizations create an environment that makes their employees behave and act persistently according to their ethical values and policies, those organizations are considered to have institutionalized their ethics (Koonmee et al., 2010)

Thus, since ethical problem is increasing in the business organization, ethics institutionalization is important as it is one of the most effective methods for business organizations to overcome the ethical problems they have faced in over years

Ethics and the quality of work life are closely related to each other Studies show that ethics positively influence the quality of work life and employees’ job

performance (Shaw, as cited in Torlak et al., 2014) Besides, acting in accordance with ethical values and policies in an organization, and creating an organizational environment promoting them, also has a positive influence on the quality of work life (Ferrell, Fraedric & Ferrell, as cited in Koonmee et al., 2010)

The purpose of a study by Lee et al (2015) is to examine the effects of ethics institutionalization on employee experiences in work life and overall life satisfaction The results indicate that implicit ethics institutionalization does indeed have a positive predictive effect on job satisfaction, esprit de corps, organizational commitment and quality of work life

Koonmee et al (2010) examines the relationship between institutionalization of ethics, quality of work life and job-related outcomes and concludes that implicit ethics institutionalization has a positive association with quality of work life

Also, in a study on ethics institutionalization and the quality of work life, Marta

et al (2013) compare American and Thai marketing managers and find that Thai businesses organizations have a higher tendency towards implicit ethics institutionalization than American business organizations Especially, they have found

no significant differences in levels of explicit ethics institutionalization However, Singhapakdi, Sirgy, Lee and Vitell (2010) have documented that explicit ethics institutionalization has a positive effect on implicit ethics institutionalization and, therefore, this could have a positive effect on the quality of work life

In summary, the above evidences suggest that institutionalization of ethics could be closely associated with the quality of work life (Marta et al., 2013; Koonmee

et al., 2010; Singhapakdi et al., 2010; Vitell & Singhapakdi, 2008)

Based on the above arguments, this study aims to expect the ethics institutionalization to have a positive influence on quality of work life Thus, the hypothesis is proposed as the following below:

Hypothesis 2a (H2a): Implicit ethics institutionalization is positively related to quality of work life

Hypothesis 3a (H3a): Explicit ethics institutionalization is positively related to quality of work life

2.4 Ethics institutionalization & Job satisfaction

In organizational working environment, job suitability and ability to handle conflicts at work also have a positive impact on an employee’s satisfaction (Dubinsky, Howell, Ingram & Bellenger, 1986) Accordingly, Sims and Kroeck (1994) argue that ethical working environment is an important factor in the person-organization study That is, employees usually choose to work in organizations whose ethical preferences fit their own And so, employees who work for organizations that institutionalize ethics would tend to be more satisfied with their jobs (Singhapakdi & Vitell, 2007)

One reason, which makes an organization institutionalize ethics, is to value integrity and trust In fact, according to a study by Moorman (1991), there is a positive causal relationship between perceptions of organizational justice and job satisfaction More recently, a study of salespeople by Schwepker (2001) indicates that there is a positive association between their perceptions of a positive ethical climate and job satisfaction

Organizational culture is considered as one of the most important tools in the study of organizations (Schwartz & Davis, 1981) There is a direct relationship between ethical behavior in organizations and corporate cultures because corporate cultures, one of categories of implicit ethics institutionalization, set the moral tone for organizations (Sims, 1992) Ethics training, one of categories of explicit ethics institutionalization, is another valuable tool that is used to raise the ethical consciousness of employees in organizations (Callan, 1992; Thompson, 1990)

Based on the research of Singhapakdi and Vitell (2007), their survey of American marketing practitioners, they argue that relationship between institutionalization of ethics and job satisfaction have been significant issues because organizations that institutionalize ethics appear to value integrity and trust and, as a result, are often more likely to treat their employees fairly And in the same study, they examine the effects of two dimensions of ethics institutionalization on perceived importance of ethics, job satisfaction, esprit de corps and organizational commitment and conclude that implicit ethics institutionalization is a significant determinant of job satisfaction, but explicit institutionalization is not

Vitell and Singhapakdi (2008) find that explicit and implicit ethics institutionalization is associated with organizational commitment, job satisfaction and team spirit

Koonmee et al (2010) claim that the relationships between ethics and employees' job-related outcomes have been important issues in advancing knowledge

in human resource management, organizational development, and business ethics

Lee et al (2015) argue that ethics institutionalization has a positive effect on job satisfaction for the following reasons Ethics institutionalization is an environmental factor affecting individual employee’s ethical decision making Ethics institutionalization fosters an ethical work climate within the organization Employees are likely to be satisfied with their jobs when they are working for an ethical firm (Chan & Lam, 2011; Valentine & Fleischman, 2008) Thus, institutionalization of ethics should reduce the incident of unfair treatment within the organization and enhance employee’s sense of security in the workplace Feelings of security in the work place should increase employee job satisfaction

Based on the above discussion, this study aims to expect both implicit and explicit ethics institutionalization to have a positive influence on job satisfaction Thus, the hypothesis is proposed as the following below:

Hypothesis 2b (H2b): Implicit ethics institutionalization is positively related to job satisfaction

Hypothesis 3b (H3b): Explicit ethics institutionalization is positively related to job satisfaction

2.5 Research model and hypothesis

Based on the literature review, a conceptual model of this study with five hypotheses is presented in Figure 2.1

Figure 2.1 – Conceptual model

There are total five hypothesis developed for this research:

H1: Quality of work life is positively related to job satisfaction

H2a: Implicit ethics institutionalization is positively related to quality of work life H2b: Implicit ethics institutionalization is positively related to job satisfaction

H3a: Explicit ethics institutionalization is positively related to quality of work life H3b: Explicit ethics institutionalization is positively related to job satisfaction

CHAPTER 3 RESEARCH METHODOLOGY

This chapter presents a details account of a research methodology of this study First, it starts with the research design, including qualitative research, main survey method and research process After that, measurement scales are presented to develop questionnaire, the preliminary evaluation of research scales is conducted to help measurement scales clearer and understandable Followed by sample size and sample method Beside, this chapter also introduces the official method of research

3.1 The research design

As mentioned in the literature review part, this topic has just taken in marketing while never done at any petroleum industry in the past Thus, the questionnaires had to take a deep consideration though being developed by many previous studies to make sure the sufficient application in the oil and gas industry Accordingly, the research design was separated into two phases: the pilot test as a qualitative research and the main survey as a quantitative research

The survey questionnaires was originally designed in English and then translated into Vietnamese by the researcher with the support of some English experts

3.1.1 Pilot study

The pilot study was conducted to test the survey questionnaire via using the qualitative research method during two weeks with ten people who are working in petroleum industry in order to check whether they understood clearly about the scales

or not

This phase aimed to consider the suitable of the contents of questionnaire with features of the oil and gas industry and ensure the final questionnaire would be well understood The procedure of conducting in-depth interviews started with specifying the objectives of the research in terms of what information was needed to be collected Then the detailed questionnaire was shown to the respondents for checking their understanding During the interview, the researcher also wanted to find out if the chosen measurement scale was suitable for conducting the research in Vietnam All the comments from the interviewees were gathered with the aim to modify the measurement scale

Based on the feedback of respondents, the survey questionnaire was slightly modified to make it clearer and more understandable (see appendix 1)

3.1.2 Main survey method

The main survey was conducted in the large scale with all the positions of employees who are working for companies related to the oil and gas industry

The methods of collecting information were personal interviews, directly filling out the paper form and, also, indirectly filling via online version of questionnaire

To access the degree of respondent’s answer, Likert scale was used in the answer sheet (from 1-strongly disagree to 5-strongly agree) The questionnaire firstly prepared in English, and then was translated Vietnamese in order to make sure the respondents could understand clearly those mentioned constructs

Figure 3.1 – Research process

3.2 Measurement scale building

From the literature reviews and the research model as referred above, measurement carefully given out to make sure the appropriation of research cope

All the constructs in the model were measured with multiple items, which were developed by other researches and also based on the results of qualitative study to adequately capture the domain of the constructs

 Implicit ethics institutionalization was measured by nine items (Singhapakdi &

Vitell, 2007; Vitell & Singhapakdi, 2008; Koonmee et al., 2010; Marta et al., 2013; Torlak et al., 2014; Lee et al., 2015)

 Explicit ethics institutionalization was measured by seven items (Singhapakdi

& Vitell, 2007; Vitell & Singhapakdi, 2008; Koonmee et al., 2010; Marta et al., 2013; Torlak et al., 2014; Lee et al., 2015)

 Quality of work life was measured by sixteen items (Sirgy et al., 2001;

Koonmee et al., 2010; Noor & Abdullah, 2012; Marta et al., 2013; Torlak et al., 2014; Lee et al., 2015)

 Job satisfaction was measured by five items (Dubinsky et al., 1986; Paolillo &

Vitell, 2002; Vitell & Singhapakdi, 2008; Koonmee et al., 2010; Lee et al., 2015)

In the research measurement scale, implicit ethics institutionalization, explicit ethics institutionalization, quality of work life and job satisfaction, all was the first- order constructs In addition, quality of work life was also the mediating variable Total 37 questions were presented in Table 3.1

Table 3.1 – Measurement scale

I Implicit Ethics Institutionalization

(Singhapakdi &Vitell, 2007)

1 Top management has established a legacy

of integrity for the organization

Lãnh đạo cấp cao xây dựng văn hoá chính trực cho công ty

IEI1

2 Top management believes that ethical

behavior, not just legal compliance, is

paramount to the success of the

3 In my organization there is a sense of

responsibility among employees for

maintaining an ethical reputation

Trong công ty, nhân viên luôn có ý thức trách nhiệm bảo vệ & duy trì uy tín đạo đức

IEI3

4 Top management in my organization

accepts responsibility for unethical and

illegal decision making on the part of

employees

Lãnh đạo cấp cao cũng nhận một phần trách nhiệm đối với việc ra quyết định trái đạo đức & không tuân thủ quy định pháp luật của nhân viên

IEI4

5 There is open communication between

superiors and subordinates to discuss

ethical conflicts and dilemmas

Có sự giao tiếp cởi mở giữa cấp trên và cấp dưới khi cùng trao đổi, thảo luận về những tính huống khó xử & những trường hợp có sự xung đột đạo đức

IEI5

6 Some employees in my organization are

allowed to perform certain questionable

actions because they are successful in

achieving their organizational objectives ®

Một số nhân viên trong công ty được trao quyền được phép chất vấn bởi vì họ thành công trong việc đạt được mục tiêu mà công ty đề ra

IEI6

7 In my organization, there are no rewards

for good ethical decisions ®

Trong công ty, không có chính sách khen thưởng đối với những quyết định mang tính đạo đức

IEI7

8 There is a shared value system and an

understanding of what constitutes

appropriate behavior in my organization

Công ty có một hệ thống giá trị chia sẻ và

sự am hiểu những yếu tố cấu thành những hành vi phù hợp

IEI8

9 Top management believes that our

organization should help to improve the

quality of life and the general welfare of

society

Lãnh đạo cấp cao tin rằng công ty sẽ giúp cải thiện chất lượng cuộc sống của nhân viên và phúc lợi chung của xã hội

IEI9

I Explicit Ethics Institutionalization

(Singhapakdi & Vitell, 2007)

10 My organization does not conduct ethics

audits on a regular basis ®

Công ty không thực hiện kiểm tra chuẩn mực đạo đức một cách thường xuyên

EEI1

11 Top management evaluates the ethics

training programs on a regular basis

Lãnh đạo cấp cao đánh giá các chương trình đào tạo về đạo đức một cách thường xuyên

EEI2

12 My organization does not have a top-level

person(s) responsible for ethics compliance

programs ®

Công ty không có một hoặc nhiều người ở cấp cao/cấp quản lý chịu trách nhiệm cho các chương trình tuân thủ đạo đức

EEI3

13 Top management is not involved in ethical

training programs ®

Lãnh đạo cao nhất không tham gia vào các chương trình đào tạo về đạo đức

EEI4

14 My organization does not have training

programs that effectively communicate

ethical standards and policies ®

Công ty không có chương trình đào tạo để truyền đạt một cách hiệu quả về chuẩn mực & nguyên tắc đạo đức

EEI5

15 My organization does not have an ethics

committee or team that deals with ethical

issues in the organization ®

Công ty không có một hội đồng chuyên trách về đạo đức để xử lý các vấn đề đạo đức phát sinh trong công ty

EEI6

16 In order to prevent misconduct within my

organization, there are training programs to

create an effective ethical culture

Để ngăn chặn hành vi sai trái trong công

ty, công ty có những chương trình đào tạo nhằm tạo ra một văn hoá ứng xử chuyên nghiệp hiệu quả

EEI7

III Quality of Work Life

(Sirgy et al., 2001)

Chất lượng cuộc sống trong công việc QWL

17 I feel physically safe at work Tôi cảm thấy an toàn ở nơi làm việc QWL1

18 My job provides good health benefits Công việc mang lại nhiều lợi ích tốt cho

sức khoẻ của tôi

Tôi hài lòng về mức thu nhập hiện tại QWL4

21 I feel that my job is secure for life Tôi cảm thấy công việc hiện tại bảo đảm

ổn định cho cuộc sống

QWL5

22 My job does well for my family Với công việc hiện tại, tôi có thể trang trải

cho cuộc sống của gia đình

QWL6

23 I have good friends at work Tôi có những đồng nghiệp tốt tại công ty QWL7

24 I have enough time away from work to

enjoy other things in life

Ngoài công việc, tôi có đủ thời gian để tận hưởng cuộc sống

QWL8

25 I feel appreciated at work Tôi cảm thấy được đánh giá cao trong

công việc hiện tại

QWL9

26 People at work and/or within my

profession respect me as a professional and

an expert in my field of work

Trong công việc, tôi được mọi người tôn trọng

28 I feel that I am realizing my potential as an

expert in my line of work

Tôi nhận ra khả năng của mình như là một chuyên gia trong công việc chính mà tôi đang làm

QWL12

29 I feel that I'm always learning new things

that help do my job better

Tôi luôn học hỏi những điều mới để giúp cho công việc của tôi tốt hơn

QWL13

30 This job allows me to sharpen my

Công việc của tôi đòi hỏi nhiều sáng tạo QWL15

32 My job helps me develop my creativity

33 Generally speaking, I am satisfied with this

job

Nói chung, tôi hài lòng với công việc này JS1

34 I frequently think of quitting this job ® Tôi thường nghĩ về việc từ bỏ công việc

này

JS2

35 I am generally satisfied with the kind of

work I do in this job

Nói chung, tôi hài lòng với các loại công việc tôi đang phụ trách

JS3

36 Most people on this job are very satisfied

with the job

Đa số mọi người đều hài lòng về công việc của mình

 n >= 100 and n > = 5k (k: number of variables)

In this research, k = 37 questions Therefore, the minimum needed for the research is 185 answers To conduct Structural Equation Modeling (SEM), Garver and Mentser and Hoelter (as cited in Mohamad & Mohamed, 2012) proposed a “critical sample size” of 200 Thus, in this research, 200 questionnaires were essential for the required sample size

Sampling method:

In association with the theoretical literature, other researches and the results of qualitative phase, the final questionnaire was given out to implicating the main survey (see appendix 2 & appendix 3)

To adapt the research objectives as mentioned above, the data was obtained from the employees who are working for the companies related to Vienamese petroleum industry and there were several companies to be chosen from three cities such as Hanoi, Ho Chi Minh, Vung Tau due to the convenience

3.4 Data analysis method

The SPSS (Statistical Package for Social Science) version 20.0 and Amos 20.0 were used in this research for analyzing primary data The researcher ran Amos 20 for SEM with purpose of enhancing the value of the model

Reliability analysis is used to evaluate the reliability of the measurement scale; this analysis requires calculating Cronbach’s Alpha Cronbach’s Alpha should be above or at least equal 0.6 to adapt internal reliability and the correlation of each specific item with total of the other items in the scale was quite high or higher than 0.3 (Nunnally & Burnstein, as cited in Nguyen, 2011)

After evaluating the scale reliability, the Exploratory Factor Analysis (EFA) method is applied to identify the number of underlying factors that explain the correlations among a set of variables as well as to test the convergent validity and discriminant validity Convergent validity shows the degree in which two measurement of the same concept are correlated (Hair et al., 2010) while discriminant validity states that two measurement scales are used to measure two different concepts need to be discriminant from each other

Confirmatory factor analysis as also run to test the model fit As shown:

 The Chi-square test indicates the amount of difference between expected and observed covariance matrices A Chi-square value close to zero indicates little difference between the expected and observed covariance matrices In addition, the probability level must be greater than 0.05 when Chi-square is close to zero (Hu & Bentler, 1999)

 The Comparative Fit Index (CFI) is equal to the discrepancy function adjusted for sample size CFI ranges from 0 to 1 with a larger value indicating better model fit Acceptable model fit is indicated by a CFI value of 0.90 or greater (Hu & Bentler, 1999)

 Root Mean Square Error of Approximation (RMSEA) is related to residual in the model RMSEA values range from 0 to 1with a smaller RMSEA value indicating better model fit Acceptable model fit is indicated by an RMSEA value of 0.06 or less (Hu & Bentler, 1999)

Then, structural equation modeling (SEM) tested the hypothesized model and estimated path coefficients for each proposed relationship in the structural model SEM is a comprehensive statistical approach to test hypotheses about relations among observed and latent variables (Hoyle, 1995) Moreover, SEM was defined as a methodology for representing, estimating, and testing a theoretical network of (mostly) linear relations between variables (Rigdon, 1998)

Table 3.2 – Key indices

(as cited in Nguyen, 2011)

The Corrected item-Total

correlation

>0.3 Nunnally and Burnstein

(as cited in Nguyen, 2011)

Kasier-Meyer-Olkin test ≥0.6 Pallant (2007)

Barlett’s test of sphericity p<0.05 Pallant (2007)

Chi-square/df (Cmin/df) <3 good; <5 sometimes

permissible

Kline (2005)

Goodness of fit index (GFI) ≥0.9 Hu and Bentler (1999)

Average goodness of fit index

Tuker and Lewis index (TLI) ≥0.9 Hu and Bentler (1999)

Root mean square residual

Hu and Bentler (1999)

CHAPTER 4 DATA ANALYSIS AND RESULTS

Chapter 4 presented the data analysis and findings The first section included data collection, sample characteristics, as well as reliability analysis to improve the internal consistency of each variable by Cronbach’s alpha Exploratory Factor Analysis (EFA) was applied to explore the factor structure (how the variables related and grouped based on intervariable correlation) Continously, Confirmatory Factor Analysis (CFA) extracted from EFA was examined the measurement models and Structural Equation Modeling (SEM) was used to test the conceptual model Based on the data analysis results, the explanation for research findings was discussed

4.1 Data collection

In order to make sure the quantity of respondents enough for the research, this research was distributed 280 questionnaires The objectives of this research aimed to analysis from view of Vietnamese petroleum industry, questionnaires were delivery conveniently After collecting the answering, 260 questionnaires were collected (as similar with the response rate was approximate 92.86%) The questionnaires collection included 20 eliminated questionnaires due to the same answers for all asking items as well as the blank items Finally, 240 questionnaires were used as valid data for this research In comparison with minimum sample size, this value was satisfactory (see table 4.1)

Table 4.1 – Sources of data collection

Marital status displayed that most of respondents were married with 68.8% and single with 31.2%

More than half of respondents who took part in this study were middle-aged people from 30 to 50 years old with 72.5% of total sample, less than 30 years old located 22.1% and the rest of age criteria was from 51 to 60 with 5.4%

In addition, their working duration was more 6 months (95.4%) and they crucially were working full time (97.5%) It also implicated as the common features of petroleum staffs because of experience demand Most of them were graduated university showing the high education degree of petroleum staffs (67.5%) Respondents had the different positions in their job, such as staff (67.8%), team leader (18.8%), line manager (9.6%) and top manager (3.8%)

Table 4.2 – Description of sample Demographic

profile