Does organizational climate moderate compensation for turnover intention? Lesson from Sharia banks

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Abstract

This study aims to reveal the effect of compensation and work engagement on the turnover intention with organizational climate as a moderating variable in Sharia banks in Indonesia. This study also analyzes the multi-group to understand the difference from the gender aspect in Sharia banks in Indonesia. Sharia bank is an alternative to conventional banking, which has proven to be resistant to various crises (Dibooglu et al., 2022). This study used a quantitative approach with convenience sampling with a total of 291 officer-level employee respondents. The partial least squares structural equation modeling (PLS-SEM) method was used to analyze the data from valid samples. The empirical findings corroborate previous studies that compensation negatively impacts turnover intention. Likewise, work engagement negatively impacts turnover intention. The results also reveal that work engagement can mediate the negative effect of compensation on turnover intention, while organizational climate can moderate the impact of compensation and turnover intention. Finally, our study also provides insight that there is no gender difference in turnover intention.

Keywords: Compensation, Work Engagement, Organization Climate, Turnover Intention, Gender

Authors’ individual contribution: Conceptualization — B.S. and A.W.; Investigation — M.S.E. and I.F.; Resources — M.S.E. and I.F.; Writing — Original Draft — B.S. and B.S.N.; Writing — Review & Editing — A.W. and B.S.N.

Declaration of conflicting interests: The Authors declare that there is no conflict of interest.

JEL Classification: I23, J63, M12

Received: 31.08.2022
Accepted: 02.10.2023
Published online: 05.10.2023

How to cite this paper: Santoso, B., Wibowo, A., Effendi, M. S., Narmaditya, B. S., & Fahrizal, I. (2023). Does organizational climate moderate compensation for turnover intention? Lesson from Sharia banks. Corporate Governance and Organizational Behavior Review, 7(4), 60–69. https://doi.org/10.22495/cgobrv7i4p5