Relationship between Emotional Intelligence and Leadership Styles: A Case Study of Leaders in Selected Banking Institutions in Kenya

Since leadership plays a critical role in the success of banking institutions, the ability to identify and focus on the factors that enhance it is crucial. The ever dynamic, demanding and competitive environment in the banking sector requires inspirational leaders who are sensitive to the feelings of employees, who are supportive, and who are able to positively influence their behaviour and secure their willing commitment towards organizational objectives. This study sought to determine the relationship between Emotional Intelligence (EI) and leadership styles of managers and supervisors among selected banking institutions in Kenya. It proposed that EI; the ability to perceive, understand and manage moods and emotions in self and others, predicts transformational leadership (TL) style that contributes to employee satisfaction and effectiveness in banking institutions. The EI scores for the managers and supervisors were obtained by administering the Emotional and Social Competency Inventory (ESCI), and to measure the perceived leadership styles, the rater form of the Multifactor Leadership Questionnaire (MLQ-5x) was completed by the subordinates, peers and superiors of each manager/supervisor. The research sample composed of 300 respondents (n=300; leaders = 60 and raters = 240) drawn from six banks. Spearman’s Rank Order Correlation was carried out on the data and the results indicated a significant positive relationship between EI scores of leaders and TL style. Further analysis indicated a positive relationship between EI and contingent reward and active MBE components of transactional leadership. On the contrary significant negative relationships were revealed between EI scores and passive MBE as well as laissez-faire leadership style. Keywords: Emotional Intelligence, Transformational, Transactional, Laissez-faire, Leadership Outcome