Towards a healthy school climate: The mediating effect of transformational leadership on cultural intelligence and organisational health

Abstract

In the ever-changing 21st-century landscape characterised by emerging global and technical trends, the search for relevant leaders in school systems relies on the premises of building a conducive, adaptive and inclusive learning environment. Thus, this article aims to examine the mediating effect of transformational leadership attributes of school leaders on their cultural intelligence and the organisational health of secondary schools in Kuala Lumpur. Using a quantitative design, a survey questionnaire was administered to 476 school leaders in Kuala Lumpur. The results from the survey were analysed using PLS-SEM technique with SmartPLS software, which established the direct effects of cultural intelligence on transformational leadership and organisational health. In addition, transformational leadership was determined to have a direct effect on organisational health. The evaluation of the structural model revealed that transformational leadership has a mediating effect on cultural intelligence of school leaders and organisational health of secondary schools. Aside from advancing the theoretical understanding of school leadership, the results of this article present reflection points for current and aspiring school leaders, opportunities for inclusion of cultural understanding in school leadership programs, and provisions in policies in organisational development in multicultural schools.

Keywords

transformational leadership cultural intelligence school climate organisational health Malaysia

Introduction

Effective school leadership presents a viable prospect in promoting a healthy school climate characterised by a goal-driven, harmonious teaching and learning environment. The saturation of studies attempting to establish the connection between leadership and school effects, such as students’ learning outcomes, paves the way to explore organisation-related factors such as school climate (McCarley et al., 2016; Myers, 2014). In connection with the aspiration of meeting academic achievement standards, studies highlight the significance of a healthy school climate in order to facilitate an environment highly conducive for teaching and learning (Robinson, 2007; Wang and Degol, 2016). In understanding how school leadership could build or sustain a healthy school climate, it is important to consider measurable constructs of causal factors and outcomes such as cultural intelligence, transformational leadership and organisational health.

Significantly, the role of school leaders in the organisational dynamics of learning institutions provides a suitable lens for further introspection. In as much as school leaders are expected to drive their organisation towards achieving set goals related to academic achievement, they are equally expected to ensure that the teaching and learning environment adheres with the tenets of optimism and harmony (Hoy et al., 2013). As instructional leaders, the influence of school leaders is not only limited to address academic-related matters, but also to promote positive interactions among the members of the organisation (Adams, 2018; Harris et al., 2018; Robinson, 2007). Particularly in this age when organisations are becoming more culturally diverse than ever before (May, 2003; Meer and Modood, 2012), school leaders could encourage and maintain peaceful co-existence among a diverse population of students and teachers in order to carry out programs and policies smoothly to attain set goals.

In addressing this query in this globalised era, cultural factors need to be scrutinised in understanding leadership perspectives; hence, cultural intelligence was determined to be an appropriate and relevant lens in deeply understanding school leadership. Although national boundaries continue to demarcate the world map, the current technological advancements and global dynamics bring organisations towards a more heterogeneous and multi-cultural landscape (Banks and Banks, 2001; May, 2003). This changing landscape does not exempt schools and school leadership. Therefore, school leaders are expected to be more adaptive in these volatile times, and this adaptability could be measured using cultural intelligence, which is defined as the capability of an individual to self-reflect and put into practice his or her knowledge of a particular culture in order to respond well in any cross-cultural interaction (Earley et al., 2006). As studies in cultural intelligence of school leaders are still limited (Solomon and Steyn, 2017), this current study brings to the fore the prospect of understanding how the cultural intelligence of school leaders could lead to a healthy school climate.

Since cultural intelligence deals primarily with a state of mind and a reflection of one’s behaviour (Earley et al., 2006), establishing its connection with a tangible school effect requires a more concrete mediator. As such, the transformational leadership attributes of a school leader could bridge the leader’s cultural intelligence with the aims of building a healthy school climate (Solomon and Steyn, 2017). For more than 20 years, transformational leadership still remains as a highly researched leadership style in various organisational settings (Karacabey et al., 2020; Leithwood and Sun, 2012). From the Full Range Leadership Model, Avolio (2011) describes a transformational leader as a leader of integrity, motivation, and inspiration, who is driven to meet organisational goals by involving the members of the organisation. In the school setting, Leithwood and Jantzi (1990, 2006) redefined transformational leadership by including school-related factors, and it was noted that school leaders who practise transformational leadership also facilitate school improvement and teachers’ continuous development (Leithwood and Sun, 2012). Due to this notion, the actions of transformational leaders could serve as a mediator between their cultural intelligence and a healthy school climate.

In order to concretely explain the effects of leadership in schools as an academic organisation, one has to consider a healthy school climate as a by-product of effective school leadership. However, as a construct, school climate needs to be measured using specific variables such as organisational health. As a measure for school climate, organisational health determines the school’s level of resilience, morale and harmony (Hoy and Hoy, 2006). Since studies on student achievement have populated the literature on school effects, research related to organisational health has been relatively scarce in the past years (Wang and Degol, 2016). However, educational leadership scholars point towards the need to divert studies from student achievement to other significant school effects like organisational health (Hallinger et al., 2018). Particularly during these times when social conflicts stem from politicised differences in ideals (Lumby and Coleman, 2007), it is crucial to determine the level of resilience, morale and harmony in multicultural schools as a qualifier for a conducive teaching and learning environment, as well as the role of school leaders in promoting such an environment.

As a multicultural and multiracial Islamic country in Southeast Asia, Malaysia offers a distinct setting in understanding the relationship between the cultural intelligence of school leaders, their transformational leadership attributes, and the organisational health of secondary school. Firstly, the heterogeneity of the Malaysian society, which is also reflected in its school system (Bakar, 2014; Brown, 2007), poses a suitable venue in understanding the extent cultural intelligence of cultural leaders affect their leadership style and their school’s organisational health. Secondly, the Malaysian Ministry of Education (MOE) clearly stipulates the need for schools to foster national unity and racial harmony; likewise, the MOE aspires to develop effective school leaders who could uphold the ministry’s system aspirations (MOE, 2012). Most importantly, this aspiration to continuously develop effective school leaders could be gauged using relevant measurable indices such as cultural intelligence and organisational health.

Thus, in the context of multicultural Malaysian schools, this study seeks to answer this question: Does transformational leadership mediate the relationship between the cultural intelligence of school leaders and the organisational health of national secondary schools in Kuala Lumpur?

In response to the aforementioned question, this research postulates the following hypotheses:

H₁ _. The cultural intelligence of school leaders has a direct effect on the transformational leadership attributes of school leaders.

H₂ . Transformational leadership attributes of school leaders have a direct effect on organisational health.

H₃ _. The cultural intelligence of school leaders has a direct effect on organisational health.

H₄ . Transformational leadership attributes of school leaders mediate the relationship between the cultural intelligence of school leaders and organisational health.

Transformational leadership

Leadership pertains to a set of actions and attitudes of an individual or a group driven to achieve goals (Bolman and Deal, 1991). In the context of this study, the Contingency Theory of Leadership highlights the need for leaders to act according to the situation and context (Fiedler, 1967). From this earlier theory, further conceptions of leadership emerge to explain the value of a charismatic and influential individual that considers the context of the situation and the individualised needs and attitudes of the members of the organisation (Gill, 2011). It was under this pretext that Bass and Avolio (1993) categorised leadership styles according to the relationship between leaders, followers and organisational goals. Among these leadership styles, transformational leadership emerged as a potential qualifier for effective leadership in various organisations due to its nature being driven by the capabilities of a leader to capitalise on the members of the organisation to achieve their mission and vision (Avolio, 2011).

Needless to say, transformational leadership remains as a highly researched leadership style, despite the emergence of various models seeking to explain the nature of effective leadership (Banks et al., 2016). From its earlier conception as a depiction of a charismatic leader (Bass, 1990), transformational leadership has evolved into a multi-dimensional construct that further defines what constitutes the leadership ideal through the Full Range Leadership Model (Avolio, 2011; Bass and Avolio, 1993). From this model, Avolio (2011) noted that transformational leadership incorporates the following dimensions: idealised influence, inspirational motivation, intellectual stimulation and individual consideration. In the school setting, Leithwood and Jantzi (2006) expanded transformational leadership to include school-related factors: modelling, high expectations, rewards, culture building, intellectual stimulation, vision, shared goals and individualised support. Thus, Bush (2017) argued that despite being one of the most widely researched leadership models over the years, transformational leadership necessitates further exploration, especially in a non-Western context.

More than two decades of studying transformational leadership in various organisational settings, especially in academic organisations, have established the impact of transformational leadership in improving organisational dynamics and in building systems improvement (Leithwood and Jantzi, 2006; Myers, 2014). In multinational companies, managers who perceived themselves as transformational Ieaders were able to positively influence the morale of their employees and increase production (Posner and Kouzes, 2012; Zhang et al., 2018). In the quest to turn around schools in the United States and in Israel, principals who manifested transformational leadership attributes were noted to influence teachers and other stakeholders in implementing change policies and programs for school improvement and better organisational health (Hameiri and Nir, 2016; Leithwood and Jantzi, 2006). Despite the establishment of the effectiveness of transformational leadership, studies in educational leadership still seek further exploration on certain drivers of such attributes in a multicultural environment and its effect on the organisation in general.

Cultural intelligence

In understanding internal factors that affect leadership, intelligence plays a role in shaping the perceptions and actions of an individual leader (Hofstede et al., 2012). With the notion that intelligence is multi-faceted, it is important to look into a timely form of intelligence relevant to address the needs of the modern-day globalised times. Thus, cultural intelligence (CQ) was conceived by Earley (2002) as a way to measure an individual’s capability to muster his or her cultural knowledge and competencies to adjust in interactions with another individual from a different race, religion, ethnicity or cultural affiliation. Critics argue that cultural intelligence shared similarities with emotional, social or interpersonal intelligence (Earley and Ang, 2003). As such, Wang et al. (2016) noted the significant correlation between social and emotional competencies and transformational leadership attributes of K-12 school leaders in the United States. However, Earley et al. (2006) noted that although cultural intelligence could be classified as a form of interpersonal intelligence, it is very much distinct from emotional and social intelligences due to the following domains: metacognitive CQ, cognitive CQ, behavioural CQ and motivational CQ.

The dimensions of cultural intelligence further define the extent an individual possess and utilise his or her culturally related abilities in an intrapersonal and interpersonal context. Metacognitive CQ pertains to the acquired knowledge of cultural perspectives from the environment and experience of the individual (Ang et al., 2015). Cognitive CQ refers to the individual’s content knowledge about religions, traditions, beliefs, norms, ethnicity, language and social ideals (Ang et al., 2015). Moreover, motivational CQ describes the internal drive of a person to decide whether to use his or her cultural knowledge and abilities in a situation; whereas, behavioural CQ refers to the actions translated from the motivation to use cultural competencies in a cross-cultural interaction (Ang et al., 2015). These specific attributes of cultural intelligence set itself apart from other forms of intelligence and provide a substantial link with leadership, as a socio-culturally motivated construct (Earley et al., 2006).

Although cultural intelligence is still a relatively underexplored construct in the study of intelligences, it has been gaining traction over the past years especially in researches in various multinational companies and multicultural institutions (Ang and Van Dyne, 2015; Chen and Lin, 2013). Initial studies on managers in multinational companies from different parts of the world reveal how a multi-cultural environment helps foster cultural intelligence and, at the same time, how managers with a high level of cultural intelligence are perceived as effective leaders (Solomon and Steyn, 2017). Likewise, in an academic setting, Keung and Rockinson-Szapkiw (2013) noted how international school leaders who reported high levels of cultural intelligence also manifested attributes associated with transformational leadership. In a study among the staff of the Education Department of Iran, metacognitive, motivational and behavioural factors of cultural intelligence were reported to be significantly correlated with organisational health (Taabodi and Rahgozar, 2016). Despite the existence of studies linking cultural intelligence with organisational behaviour, further studies need to be conducted in establishing the relationship between cultural intelligence and organisational health in the academic setting.

Organisational health

Overshadowed by studies in students’ academic achievement, school climate poses equally promising potential for understanding the organisational dynamics and the learning environment of schools (Wang and Degol, 2016). In the field of educational leadership, promoting a positive school climate is one of the key dimensions that school leaders have to consider as instructional leaders (Hallinger, 2011; Robinson, 2007). School climate is generally defined as the quality of the organisational dynamics of the school characterised by the relationship between key stakeholders and other school factors contributing to the sustainability of the teaching and learning environment (Fox and Boies, 1974; Hoy and Hoy, 2006). Due to its general and abstract nature, Hoy et al. (2013) argued that school climate can only be measured using constructs such as organisational health to gauge the school’s level of morale, resilience and harmony.

As a measurable construct, organisational health can be further explained by the following dimensions: consideration, school leader influence, resource support, morale and academic emphasis (Hoy and Feldman, 1987). Consideration and school leader influence pertain to how the school leaders interact with the teachers and other school leaders (Hoy and Sabo, 1998). Resource support measures the extent to which the school provides the teachers and students with their needed instructional materials, equipment and infrastructure (Hoy and Hoy, 2006). As a key organisational health dimension, morale measures the level of friendliness, confidence and harmony among teachers, whereas academic emphasis looks into the extent the members of the school community prioritise academic matters (Hoy et al., 2013). Therefore, a healthy school climate can be best defined if all these organisational health dimensions are satisfied.

Using these dimensions, several studies have noted the effects of school leadership on the organisational health of schools. In a study in the United States, principals who manifested transformational leadership attributes had a significant effect on the academic emphasis of their schools (Day et al., 2016). In Turkey, principals who practised transformational leadership created a positive atmosphere in their schools, which reported lower risks of bullying in the workplace (Cemaloğlu, 2011). Although critics argue that other factors, such as teachers’ collegiality and working conditions, play a more significant role in attaining a healthy learning organisation (Wang and Degol, 2016), further examination of causal factors leading to a healthy school climate requires investigation of the relationship between cultural intelligence, transformational leadership and organisational health in the context of secondary schools in Malaysia.

Contextual background

Malaysia, a multiracial and multicultural country in Southeast Asia, has been the subject of several studies in multiculturalism in the East (Bakar, 2014; Brown, 2007; Hofstede et al., 2012). Although predominantly Muslim, Malaysia takes pride in its diverse cultural landscape marked by racial harmony (Cheah, 2002). The Malay-Muslim majority live side by side with Malaysian citizens of Chinese or Indian descent, who have kept their traditions and continuously practise their religious beliefs, as well as with people from indigenous tribes and expatriates from different parts of the world (Brown, 2007). Geographically, rural areas in Malaysia are still polarised according to race, with towns either homogeneously Malay, Chinese or Indian territories (Bakar, 2014). However, urban areas like Kuala Lumpur reflect Malaysia’s multicultural profile, with 46% of its population as Malays, 43% Chinese, 10% Indians and 8.2% of the general local population comprising expatriates (BPDPM, 2010). Thus, Kuala Lumpur was determined as an appropriate setting for this research.

Likewise, national secondary schools in Kuala Lumpur generally reflect this demographic profile (MOE, 2012). Since the premise of cultural intelligence lies on cross-cultural interactions, schools present a viable research setting in understanding how school leaders use their cultural intelligence in interacting and in leading in a culturally diverse learning environment to achieve a healthy school climate. More importantly, the Malaysian Ministry of Education clearly stipulated in its aspirations for the education system that schools should develop students who value national unity and racial harmony and that school leaders should ensure that these aspirations are met through effective leadership practices (MOE, 2012). While it was noted in a study by Bush and Ng (2019) that the Ministry prescribed distributed leadership, the sharing of responsibilities with school leaders and teachers requires careful consideration of socio-cultural factors.

Hypothesised model

As mentioned earlier, the Contingency Theory of Leadership sets the theoretical foundation of this study in examining the effectiveness of a leadership style based on a determined situation and desired effects (Fiedler, 1967). Guided by the aforementioned theories, empirical studies and hypotheses, the hypothesised model of this current study was designed to show the relationship between cultural intelligence, transformational leadership, and organisational health in national secondary schools in Kuala Lumpur.

As shown in Figure 1, cultural intelligence was identified as the antecedent variable to the exogenous variable transformational leadership and the endogenous variable organisational health (Avolio, 2011; Bass and Avolio, 1993; Earley, 2002; Hoy and Feldman, 1987). In addition, the cultural intelligence of school leaders was also postulated to have an indirect effect on the organisational health of secondary schools. Through this framework, it was hypothesised that transformational leadership has a mediating effect on the relationship between cultural intelligence and organisational health. Avolio (2011) has noted the theoretical role of transformational leadership attributes in bridging a leader’s personal traits and organisational outcomes. Bridging the relationship between an intelligence factor and organisational behaviour, Zhang et al. (2018) reported that transformational leadership serves as a mediator between a leader’s socio-cultural intelligence and commitment. In the school setting, the mediating role of transformational leadership was linked with the capability of a school leader to diffuse uncertainty and the quality of the school’s organisational health (Hameiri and Nir, 2016). Although theoretical and empirical findings support the relationship between a leader’s intelligence, style and organisational outcome, the hypothesised model of this study requires a rigid methodology to establish the relationship between cultural intelligence, transformational leadership and organisational health.

Methodology

Using a quantitative research design, this study employed a deductive approach in examining the mediating effects of transformational leadership of school leaders on their cultural intelligence and their school’s organisational health. In an objectivist and positivist lens, this research ensured that the procedures and standards were followed in order to establish validity and reliability in proving or rejecting the formulated hypothesis (Cohen et al., 2011). Thus, a survey questionnaire with closed-ended questions were administered to school leaders in national secondary schools in Kuala Lumpur, Malaysia, and confirmatory factor analysis was utilised in procedurally analysing the data and in objectively establishing the mediating effect of transformational leadership on cultural intelligence and organisational health.

Population and sampling

In understanding the relationship between the variables in the context of multicultural education, the population determined for this study is composed of school leaders from national secondary schools in Kuala Lumpur, Malaysia. As discussed in the previous section, the multicultural demography of Kuala Lumpur as Malaysia’s capital city fits the intention of this research particularly in a sense that studying cultural intelligence necessitates cross-cultural interactions. Furthermore, urban national secondary schools are more culturally diverse compared with their rural counterparts, according to the MOE (2012).

Moreover, in the quest to probe into and improve school leadership in the Malaysian education context, school leaders themselves were deemed as appropriate respondents in order to gauge a self-reflective evaluation of their cultural intelligence, leadership attributes, and the organisation in which they belonged. As defined by Malaysia’s Ministry of Education, school leaders include those in the following positions: principal, assistant principal, head of departments and subject heads (MOE, 2012). Therefore, from the estimated 810 school leaders in Kuala Lumpur, 540 were asked to participate in this study, by using cluster random sampling. This sample followed the ideal target of 458 based on the sampling determination technique by Krejcie and Morgan (1970) for a confidence level of 95%, which determines the reliability of the sample size of this study (Cohen et al., 2011). In this sampling technique, Kuala Lumpur was divided into three districts (Bangsar Pudu, Sentul, and Keramat) as per the MOE’s jurisdiction, and a maximum of nine school leaders from each of the 60 schools was randomly chosen from the three districts.

Instrumentation

The items in the survey questionnaire used in this study were adapted from established instruments in measuring cultural intelligence, transformational leadership and organisational health. The first section of the instrument sought demographic information on the respondents. The 20 items in the second section were adapted from the Cultural Intelligence Scale or CQS (Ang et al., 2007). The 20 items in the third second were adapted from the Multi-factor Leadership Questionnaire or MLQ-5x Short (Bass and Avolio, 1995), while the 37 items in the fourth section were adapted from the Organisational Health Inventory for Secondary Schools or OHI-S (Feldman and Hoy, 2000). For instance, item B3 ‘I enjoy interacting with people from different cultures’ measures cultural intelligence while item C31 ‘I help others to develop their strengths’ pertains to a transformational leadership attribute. Permission to adapt the items from the aforementioned questionnaires was sought and acquired by the researcher prior to conducting the research.

Content validation

After the necessary permission was obtained for the instrument, the researcher consulted four experts in the field of cultural intelligence, educational leadership and organisational climate to validate the content and structure of the instrument. A language expert in English and in Bahasa Melayu (Malay Language) also went through the instrument for the composition of the items and the accuracy of the translation. Hence, these content and face validation procedures of the instrument determined the appropriateness of the survey questionnaire for this study in educational research (Creswell, 2012).

Data collection

After establishing the content validity and internal consistency of the questionnaire, the researcher sought the necessary permissions from the university and the Malaysian Ministry of Education to carry on with the research. After acquiring the letter of confirmation from the university, permission letters from the Education Planning Research Division or EPRD of the Ministry of Education and the KL Department Office were granted for this research. Next, the researcher contacted gatekeepers and visited the schools to administer the survey questionnaire. Each survey questionnaire contained a cover letter, which highlighted the following: the scope of the research, the confidentiality of the responses and the right of the respondents to withdraw from the study. The entire data collection process ran for a month.

Demographic profile of research participants

From the 540 school leaders from 60 schools in Kuala Lumpur, 522 responses were collected, which constituted a response rate of 93.21%. After the data were checked and cleaned for missing information and outliers, 476 cases remained, being 88.15% of the initial sample. Table 1 presents the demographic profile of the respondents. As noted in the previous section, the Malaysian Ministry of Education defines school leaders as those individuals with the position principal, assistant principal, and heads of department due to its system aspiration of embracing a more autonomous and distributed form of leadership in schools (MOE, 2012).

Table 1.

Demographic Profile of Participants (n = 476).

Demography	Variables	Frequency	Percentage
Age (years)	26–30	11	2.3%
	31–35	33	6.9%
	36–40	41	8.6%
	41–45	73	15.3%
	46–50	93	19.5%
	Above 50	225	47.3%
Gender	Male	73	15.3%
Gender	Female	403	84.7%
Race	Malay	358	75.2%
	Chinese	81	17.0%
	Indian	34	7.1%
	Others¹	3	0.6%
Position	Principal	42	8.8%
	Assistant Principal	198	41.6%
	Head of Department	230	48.3%
	Others²	6	1.3%
Years in position	Less than a year	47	9.9%
	1–2 years	79	16.6%
	3–4 years	87	18.3%
	5–6 years	57	12.0%
	7–8 years	27	5.7%
	9–10 years	39	8.2%
	More than 10 years	140	29.4%

¹ ‘Others’ refers to ethnic groups (i.e. Kadazan), mixed races, or expatriates, other than the three major racial groups.

² ‘Others’ refers to subject heads or program coordinators.

As listed in Table 1, 225 out of 476 respondents were over the age of 50 years, which represented 47.3% of participants, indicating the maturity and hierarchical nature of leadership in the Malaysian school system. This implies that a majority of the school leaders will be retiring in the next 5 years. With respect to gender profile, 403 of 476 participants were female, representing more than 84.7% of the respondents, and only 73 (15.3%) were male. In terms of race, the multi-cultural population of Malaysia was somehow reflected in this sample: 358 (75.2%) of the respondents were Malay, 81 (17.0%) were Chinese, and 34 (7.1%) were Indian. In terms of position, the majority of the respondents were heads of department, which comprised 230 of the 476 participants (48.3%), 198 (41.6%) were assistant principals, 42 (8.8%) were principals, while 6 (1.35%) were in other roles.

Data analysis

In assessing the relationship between transformational leadership, cultural intelligence of school leaders, and the organisational health of secondary schools, this study used SmartPLS version 3 to examine both the measurement and structural models (Hair et al., 2017; Sarstedt and Cheah, 2019). In particular, the measurement model was assessed for both the first-order and the second-order constructs to ensure that the internal consistency (Cronbach’s alpha), convergent validity (Average Variance Extract) and discriminant validity (i.e. Heterotrait-Monotrait ratio of correction) meet the suggested threshold quality. Then, the structural model was analysed using the two-stage approach to determine the relationship between the higher order constructs through coefficient of determination, predictive relevance, effect size, and variance accounted for (VAF) mediation (Hair et al., 2017). PLS-SEM addresses the weakness of first-generation statistical techniques and provides a better statistical rigor in describing the relationship between specified variables (Hair et al., 2017). As such, this establishes the superiority of PLS-SEM in dealing with higher-order variables such as transformational leadership, cultural intelligence and organisational health (Hair et al., 2017). Using this two-stage approach (Cheah et al., 2019; Sarstedt et al., 2019; Sarstedt et al., 2019), the following section reports the findings of this study to determine the mediating effect of transformational leadership of school leaders on cultural intelligence and organisational health.

Findings

Assessment of measurement model

Drawing on the standard evaluation guidelines, the initial assessment is based on the assessment of reflective measurement model on the lower-order components (Cheah et al., 2019; Sarstedt et al., 2019). The assessment of the measurement model in Table 2 shows that all the loadings from the measures of the lower-order components (i.e., Academic Emphasis, Behavioural, Consideration, etc.) exceed the threshold value of 0.5 after deleting 16 items from the overall of 77 items. In addition, the average variance extracted (AVE) is higher than the cut-off value of 0.5. All the composite reliability values are above 0.7, thus establishing the measures’ internal consistency reliability.

Table 2.

Assessment of Loading, CR, and AVE on the Lower Order Components.

Higher order	Lower order construct	Indicator	Loading	CR	AVE
Cultural intelligence (CQ)	Metacognitive (MCQ)	MC1	0.641	0.813	0.522
		MC5	0.745
		MC9	0.772
		MC13	0.727
	Cognitive (CCQ)	CC6	0.659	0.812	0.521
		CC10	0.687
		CC14	0.759
		CC18	0.777
	Motivational (MOCQ)	MO3	0.740	0.822	0.536
		MO7	0.753
		MO15	0.706
		MO19	0.730
	Behavioural (BCQ)	BC4	0.714	0.827	0.544
		BC12	0.748
		BC16	0.745
		BC20	0.744
Transformational leadership (TL)	Idealised influence: Attitude (IA)	IA18	0.650	0.785	0.551
		IA21	0.776
		IA25	0.793
	Idealised influence: Behaviour (IB)	IB14	0.852	0.843	0.643
		IB23	0.764
		IB34	0.786
	Individual consideration (IC)	IC15	0.710	0.796	0.566
		IC29	0.722
		IC31	0.820
	Inspirational motivational (IM)	IM9	0.668	0.846	0.581
		IM13	0.782
		IM26	0.805
		IM36	0.785
	Intellectual stimulation (IS)	IS2	0.586	0.77	0.532
		IS30	0.746
		IS32	0.835
Organisational health (OH)	Academic emphasis (AE)	AE35	0.704	0.832	0.501
		AE38	0.676
		AE41	0.731
		AE43	0.782
		AE7	0.633
	Morale (M)	M6	0.699	0.881	0.514
		M13	0.668
		M27	0.747
		M37	0.707
		M40	0.665
		M42	0.787
		M44	0.740
	Consideration (C)	C3	0.757	0.845	0.525
		C10	0.546
		C17	0.752
		C24	0.750
		C31	0.790
	Initiating structure (IS-DV)	IS4	0.681	0.867	0.568
		IS11	0.699
		IS18	0.816
		IS25	0.799
		IS32	0.765
	School leader influence (SL)	SI9	0.650	0.769	0.528
		SI16	0.786
		SI23	0.737
	Resource support (RS)	RS5	0.797	0.904	0.654
		RS12	0.836
		RS19	0.831
		RS26	0.849
		RS33	0.723

Next, this study continued to assess the loadings, composite reliability (CR), and average variance extracted of the higher order components (Hair et al., 2017). As shown in Table 3, all item loadings exceed the recommended value of 0.5 (Hair et al., 2017). As a result, the CR values of the Cultural Intelligence, Transformational Leadership, and Organisational Health are greater than 0.7, and the AVE values of these constructs exceed the threshold value of 0.5 (Hair et al., 2017).

Table 3.

Assessment of Loading, CR, and AVE on the Higher-Order Components.

Construct	Indicator	Loading	CR	AVE
Cultural intelligence(CQ)	Metacognitive (MCQ)	0.840	0.891	0.673
	Cognitive (CCQ)	0.769
	Motivational (MOCQ)	0.857
	Behavioural (BCQ)	0.812
Transformationalleadership (TL)	Idealised influence: Attitude (IA)	0.797	0.928	0.720
	Idealised influence: Behaviour (IB)	0.875
	Inspirational motivation (IM)	0.903
	Intellectual stimulation (IS)	0.818
	Individual consideration (IC)	0.845
Organisational health(OH)	School leadership influence (SL)	0.633	0.900	0.601
	Consideration (C)	0.858
	Initiating structure (IS)	0.837
	Resource support (RS)	0.761
	Morale (M)	0.788
	Academic emphasis (AE)	0.754

Subsequently, this study also assessed the discriminant validity test for the lower-order constructs, as well as the higher-order constructs. The discriminant validity test establishes the idea that every construct is distinct and that it does not measure similar factors in the model; hence, this study examined the Heterotrait-Monotrait (HTMT) ratio of correlation (Henseler et al., 2015). Table 4 shows the assessment of HTMT values of the lower-order constructs; whereas, Table 5 presents the results of the discriminant validity test of the higher-order constructs. Since the HTMT values were below 0.85, these figures establish the discriminant validity of the lower-order and higher-order constructs in the model.

Table 4.

Assessment of Discriminant Validity of Lower-Order Constructs using HTMT (2015).

	AE	BCQ	C	CCQ	IA	IB	IC	IM	IS	IS-DV	M	MCQ	MOCQ	RS
AE
BCQ	0.380
C	0.672	0.469
CCQ	0.315	0.621	0.295
IA	0.523	0.498	0.517	0.433
IB	0.519	0.380	0.525	0.311	0.793
IC	0.553	0.392	0.553	0.384	0.791	0.798
IM	0.566	0.516	0.575	0.359	0.786	0.794	0.796
IS	0.526	0.549	0.560	0.539	0.698	0.695	0.798	0.789
IS-DV	0.612	0.356	0.894	0.173	0.521	0.611	0.580	0.570	0.511
M	0.783	0.325	0.653	0.225	0.482	0.590	0.590	0.552	0.512	0.711
MCQ	0.465	0.774	0.495	0.689	0.562	0.527	0.485	0.587	0.658	0.498	0.422
MOCQ	0.476	0.786	0.459	0.853	0.736	0.519	0.596	0.612	0.664	0.359	0.340	0.764
RS	0.585	0.410	0.756	0.328	0.339	0.334	0.339	0.388	0.315	0.646	0.455	0.416	0.340
SI	0.521	0.444	0.789	0.311	0.343	0.285	0.352	0.343	0.375	0.626	0.447	0.365	0.372	0.714

Note: AE: Academic Emphasis; BCQ: Behavioural Cultural Intelligence; C: Consideration; CCQ: Cognitive Cultural Intelligence; IA: Idealised Inspiration (Attitude); IB: Idealised Inspiration (Behaviour); IC: Individual Consideration; IM: Inspirational Motivation; IS: Intellectual Stimulation; IS-DV: Initiating Structure; M: Morale; MCQ: Motivational Cultural Intelligence; MOCQ: Motivational Cultural Intelligence; RS: Resource Support; SI:School Leader Influence.

Table 5.

Assessment of Discriminant Validity of Higher-Order Construct using HTMT (2015).

Construct	CQ	OH
CQ
OH	0.487
TL	0.568	0.588

Note: CQ: Cultural Intelligence; OH: Organisational Health; TL: Transformational Leadership.

Therefore, the constructs and the identified indicators were determined to be suitable in evaluating the model and in testing the hypothesis.

Evaluating the structural model

Based on the results of the assessment of the measurement model, a structural model was designed to show the relationship between the constructs. As shown in Figure 2, the structural model of this study was evaluated to establish the mediating effect of transformational leadership (TL) on cultural intelligence (CQ) and organisational health (OH). (Refer to Appendix available in the online materials for the sample items included the structural model.)

From the indicators specified in the structural model above, the variance inflation factor or VIF was assessed to measure the tolerance of collinearity in order to ensure that one relationship is not explained by other constructs. Table 6 shows the VIF values of the constructs, which are below the 5.0 assumption of collinearity (Hair et al., 2017). Next, by utilising a bootstrapping procedure, the significance of the path coefficients was examined with a two-tailed test considering a sample of 500 with a significance level of 95%. This test rendered figures showing the path coefficients, t-values, and p-values as shown in Table 6. The values established the significance of the relationship between cultural intelligence (CQ), transformational leadership (TL) and organisational health (OH).

Table 6.

Assessment of the Structural Model (Direct and Mediation Assessments).

						95% BCa
Hypothesis relationship		Std Beta	Std Error	t value	p value	LB	UB	VIF	f²	R²	Q²	VAF	Decision
H₁	CQ -> TL	0.502	0.037	13.506	0.000	0.437	0.559	1.000	NA	0.252	0.248		Supported
H₂	CQ -> OH	0.223	0.047	4.752	0.000	0.143	0.298	1.337	0.055	0.326	0.187		Supported
H₃	TL -> OH	0.426	0.048	8.782	0.000	0.341	0.502	1.337	0.201				Supported
H₄	CQ -> TL -> OH	0.214	0.030	7.149	0.000	0.158	0.276					48.97%	Supported

Note: CQ-Cultural Intelligence, TL-Transformational Leadership, OH-Organisational Health.

After establishing the significance of the relationship between the constructs, the coefficient of determination of the effect of cultural intelligence on transformational leadership (TL) and cultural intelligence (CQ) was assessed using R² values. The predictive relevance of the variables was also examined using Q² values in order to further establish the relationship between the constructs. Based on the figures in Table 6, a relationship was determined between cultural intelligence and transformational leadership (R² = 0.252, Q² = 0.252) and between cultural intelligence and organisational health (R² = 0.326, Q² = 0.187) although the values posed weak effects. In addition, the effect sizes of cultural intelligence (CQ) on transformational leadership (TL) and organisational health (OH) were determined. Then, the f² effect size was calculated, and it was determined that cultural intelligence (CQ) has a small effect on organisational health (OH) (f² = 0.055). In addition, the f² effect size of the relationship between TL and OH exhibits a medium effect size (f² = 0.201). Therefore, the first three hypotheses of this study were accepted.

Based on the guidelines by Preacher and Hayes (2008), the result indicated that transformational leadership mediates the relationship between cultural intelligence and organisational health. The bootstrapping result of the indirect effects yielded a significant value; hence, the variance accounted for (VAF) was calculated to assess the level of mediation using the formula below (Hair et al., 2014): $V A F = \frac{(0.214)}{(0.214 + 0.233)} * 100 % = 47.875 %$

As shown in Table 6, the VAF value was 48.875%. Given that the “VAF is larger than 20% and less than 80%”, Hair et al. (2014, p. 225) noted that that this indicates that transformational leadership partially mediates the relationship between cultural intelligence and organisational health; thus, hypothesis 4 (H₄) was accepted.

Discussion and implications

Based on the results of the model evaluation, this study was able to establish the mediating effect of transformational leadership between the cultural intelligence of school leaders and the organisational health of secondary schools in Kuala Lumpur. In determining mediation, the procedures in confirmatory analysis using PLS-SEM examined the relationships between the constructs prior to testing the hypotheses. First, it was determined that cultural intelligence has direct effects on transformational leadership. Studies in multicultural educational settings in Hong Kong and in the Middle East found school leaders who manifested high levels of cultural intelligence also showed transformational leadership attributes (Aldhaheri, 2017; Keung and Rockinson-Szapkiw, 2013). Moreover, transformational leadership have significant effects on organisational health. As such, the results of this study reflect the findings of Cemaloglu (2011) in positively correlating transformational leadership and organisational health in schools in Turkey.

The model also established the direct effect of cultural intelligence of school leaders on the organisational health of national secondary schools in Kuala Lumpur. As culture is embedded in every organisation (Hofstede et al., 2012), leaders with a high level of cultural intelligence can positively influence organisational behaviour factors such as collaboration and motivation (Chen and Lin, 2013). In contribution to studies in cultural intelligence and organisational health, this study presented the possibility of the positive effects of cultural intelligence of school leaders in building and sustaining a healthy school climate.

Moreover, the findings of this research brought into the fore the mediating effect of transformational leadership in fully understanding the link between cultural intelligence constructs and organisational health dynamics. In a similar study in China by Zhang et al. (2018), transformational leadership was identified to be a mediator between cultural intelligence and collaboration in organisations. Likewise, a quantitative study in Israel presented the mediating role of transformational leaders between uncertainty and organisational health (Hameiri and Nir, 2016). Furthermore, leadership creates a link between value systems of leaders and organisational behaviour related to commitment and goal setting (Day et al., 2016). In as much as the aforementioned studies identified the role of transformational leadership as a mediator between two constructs related to psycho-social nature and organisational outcome, they fell short in establishing a specific connection with cultural intelligence and organisational health in culturally diverse schools, which has been fully addressed by this study.

As the structural model evaluation of this study was able to determine that transformational leadership plays a mediating role between cultural intelligence and organisational health, aspiring school leaders and those in vital leadership positions in multicultural learning organisations are expected to develop transformational leadership attributes while considering religious and traditional beliefs in upholding the values of openness, acceptance and respect for a more conducive teaching and learning environment. Aside from individual actions from school leaders, the education ministries of multicultural countries should create leadership programs to further enhance the cultural knowledge and capabilities of their school leaders, as well as develop transformational leaders, in order to reap its rewards in building and sustaining a healthy school climate. Since the quantitative findings of this study were limited in its geographic scope, future research could be done in other multicultural states and in a broader geographical range. Needless to say, exploratory studies could further explain the relationship between cultural intelligence, transformational leadership and organisational health not only in a culturally diverse setting, but also in homogenous societies that thrive in this globalised era.

Footnotes

Appendix

Sample Items in the Structural Model.

Declaration of conflicting interests

The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.

Funding

The author(s) received no financial support for the research, authorship, and/or publication of this article.

ORCID iD

Joseph M. Velarde

Donnie Adams

Jun-Hwa Cheah

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