Al-Kharaj: Journal of Islamic Economic and Business
Vol. 8 No. 3 (2026): Vol. 8 No. 2 (2026): All articles in this issue include authors from 3 countrie

Institutional Trust, Ethical Governance, and Public Sector Performance in Timor-Leste

Novia Rosa de Sousa (STIE YKPN Yogyakarta)
Miswanto (STIE YKPN Yogyakarta)
Frasto Biyanto (STIE YKPN Yogyakarta)
Baldric Siregar (STIE YKPN Yogyakarta)



Article Info

Publish Date
28 Jul 2026

Abstract

Purpose: This study aims to analyze the influence of ethical governance and HRM practices on public sector performance, with institutional trust as a mediating variable, among public sector employees in Timor-Leste. Methods: This study employed a quantitative explanatory approach using purposive sampling, involving 150 respondents who work as civil servants across ministries and government agencies in Timor-Leste. Data were collected through a five-point Likert-scale questionnaire and analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM) with SmartPLS 3. Results: The results show that ethical governance and HRM practices have a positive and significant effect on institutional trust, while their direct effects on public sector performance are not significant. Institutional trust, in turn, has a positive and significant effect on public sector performance and fully mediates the relationship between both ethical governance and HRM practices toward performance. Implications: These findings suggest that public sector institutions in Timor-Leste should prioritize building institutional trust as a strategic mechanism to translate ethical governance and human resource practices into improved organizational performance, rather than relying on these practices alone.

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Journal Info

Abbrev

alkharaj

Publisher

Subject

Economics, Econometrics & Finance

Description

Al-Kharaj, Journal of Islamic Economic and Business is peer-reviewed journal published by program studi ekonomi syariah , Institut Agama Islam Negeri (IAIN) Palopo. Al-Kharaj focus on the research of Islamic Economic and Business. The aims of this journal is to explore and develop economic related ...