THE ROLE OF ORGANIZATIONAL TRUST IN ENHANCING EMPLOYEE PERFORMANCE: A CONCEPTUAL REVIEW

Abstract

Organisational trust is widely recognised as a fundamental factor in fostering effective workplace relationships and improving employee performance. However, existing evidence remains fragmented across different trust referents, performance dimensions, and organisational contexts. This study aims to synthesise the current literature on the role of organisational trust in enhancing employee performance and to identify the principal mechanisms and contextual factors underlying this relationship. A structured literature review was conducted using predefined search, screening, and selection criteria. Twenty relevant studies, including empirical research, systematic reviews, and meta-analyses, were analysed through thematic and narrative synthesis to examine trust dimensions, performance outcomes, and mediating and moderating mechanisms. The reviewed evidence indicates that organisational trust is generally associated with improved employee, team, and organisational performance. Horizontal trust often demonstrates stronger associations with performance than vertical trust, while trust in leaders remains an important predictor through its influence on leadership effectiveness, communication, and organisational support. The findings further show that organisational trust frequently enhances performance indirectly by promoting employee engagement, organisational commitment, knowledge sharing, collaboration, innovation, and reduced workplace stress. Nevertheless, the strength of these relationships varies according to organisational context, trust referent, and performance measurement. Overall, organisational trust represents an important explanatory factor in employee performance, although its effects are not uniform across settings. The review highlights the need for future research to examine direct, indirect, and multilevel trust–performance relationships across diverse organisational and cultural contexts while emphasising the practical importance of cultivating trust through supportive leadership, fair organisational practices, and effective trust- repair strategies.