The role of positive leadership and psychological capital on influencing trust and flourishing: Insights from two studies

Aim/purpose – The article aims to explore the impact of positive leadership on trust and flourishing, examine the relationship between psychological capital and flourishing, and identify the role played by psychological empowerment in this relationship. Design/methodology/approach – Employing a two-study approach, the research utilized judgmental sampling across service sectors in India. The first study focused on software professionals, with 983 respondents from information technology organizations. The second study investigated employees in the banking, retail, and e-commerce sectors, involving 722 participants. Validated scales were used to measure constructs across these service sector contexts. Findings – The results revealed significant insights into organizational dynamics. Positive leadership was found to substantially influence workplace trust and employee flourishing. Psychological capital demonstrated a critical mediating effect between leadership practices and employee well-being. Furthermore, psychological empowerment emerged as a key mechanism explaining how psychological capital translates into enhanced employee flourishing. Research implications/limitations – The study proves positive leadership strategies can enhance software professionals’ well-being and organizational trust. However, the findings are limited to India’s specific service sectors and geographical context, suggesting the need for cross-cultural and cross-sector validation. Originality/value/contribution – This research contributes novel insights into the psychological mechanisms driving sustainable organizational development. By integrating positive leadership, psychological capital, and empowerment, the study offers a comprehensive framework for understanding how psychological resources influence employee flourishing, a perspective underexplored in previous literature.