The role of Green Transformational Leadership and Green Product Innovation in Emerging Economies: Green Employee Behaviour and Green Human Resource Management as Intervening Variables

Ach. Syaiful Rizal; Dian Anita Nuswantara; Hariyati; Ali Elazumi Ali Alnajar

doi:10.24123/jeb.v5i3.6867

Ach. Syaiful Rizal Magister Manajemen, Universitas Dr Soetomo, Surabaya
Dian Anita Nuswantara Accounting of Department, Universitas Negeri Surabaya, Indonesia
Hariyati Accounting of Department, Universitas Negeri Surabaya, Indonesia
Ali Elazumi Ali Alnajar School of Business, University of Central Lancashire, United Kingdom

DOI: https://doi.org/10.24123/jeb.v5i3.6867

Abstract Views: 45 times

PDF Downloads: 59 times

Keywords: Green Transformational Leadership, Green Product Innovation, Green Employee Behavior, Green Human Resource Management

Abstract

Purpose: This study is to offer a critical re-evaluation of the Green Transformational Leadership (GTL)–Green Product Innovation (GPI) relationship within SMEs in emerging economies, challenging the direct causality assumed in prior research. Theoretically, GTL, as a conceptual construct, lacks the mechanisms to produce a direct impact on GPI, a misconception widely propagated in earlier literature. As such, our study is to redirect such topical issues. In doing so, we also analysed green employee behavior (GEB) and green human resource management (GHRM) as intervening variables.

Method: We distributed questionnaires into several SMEs operated in East Java, Indonesia.

Result: Our empirical evidence strongly supports the proposed framework, suggesting no significant direct relationship between GTL and GPI and even showing a negative coefficient. However, when mediated by GHRM and GEB, the relationship becomes both positive and significant, indicating that these intervening variables are essential for realising the innovation potential of GTL. Furthermore, GTL partially fosters GHRM and GEB, while both GHRM and GEB positively influence GPI. These findings carry profound theoretical implications by refining the understanding of leadership’s role in sustainability practices and offering actionable insights for managers aiming to enhance green innovation through strategic HR and behavioural interventions.

Downloads

Download data is not yet available.

References

Ababneh, O. M. A. (2021). How do green HRM practices affect employees’ green behaviors? The role of employee engagement and personality attributes. Journal of Environmental Planning and Management, 64(7), 1204-1226.

Abbas, J. (2024). Does the nexus of corporate social responsibility and green dynamic capabilities drive firms toward green technological innovation? The moderating role of green transformational leadership. Technological Forecasting and Social Change, 208, 123698.

Aboramadan, M. (2022). The effect of green HRM on employee green behaviors in higher education: the mediating mechanism of green work engagement. International Journal of Organizational Analysis, 30(1), 7-23.

Agrawal, S., & Pradhan, S. (2023). Employee green behavior in hotels: the role of green human resource management, green transformational leadership and value congruence. Consumer Behavior in Tourism and Hospitality, 18(2), 241-255.

Agyabeng-Mensah, Y., Ahenkorah, E., Afum, E., Agyemang, A. N., Agnikpe, C., & Rogers, F. (2020). Examining the influence of internal green supply chain practices, green human resource management and supply chain environmental cooperation on firm performance. Supply Chain Management: An International Journal, 25(5), 585-599.

Ahmad, B., Shafique, I., Qammar, A., Ercek, M., & Kalyar, M. N. (2024). Prompting green product and process innovation: examining the effects of green transformational leadership and dynamic capabilities. Technology Analysis & Strategic Management, 36(6), 1111-1123.

Ahmed, R. R., Akbar, W., Aijaz, M., Channar, Z. A., Ahmed, F., & Parmar, V. (2023). The role of green innovation on environmental and organizational performance: Moderation of human resource practices and management commitment. Heliyon, 9(1).

Akhtar, S., Martins, J. M., Mata, P. N., Tian, H., Naz, S., Dâmaso, M., & Santos, R. S. (2021). Assessing the relationship between market orientation and green product innovation: the intervening role of green self-efficacy and moderating role of resource bricolage. Sustainability, 13(20), 11494.

Aksom, H., & Tymchenko, I. (2020). How institutional theories explain and fail to explain organizations. Journal of Organizational Change Management, 33(7), 1223-1252.

Al-Swidi, A. K., Gelaidan, H. M., & Saleh, R. M. (2021). The joint impact of green human resource management, leadership and organizational culture on employees’ green behaviour and organisational environmental performance. Journal of cleaner production, 316, 128112.

Anlesinya, A., Amponsah-Tawiah, K., Dartey-Baah, K., Adeti, S. K., & Brefo-Manuh, A. B. (2023). Institutional isomorphism and sustainable HRM adoption: a conceptual framework. Industrial and Commercial Training, 55(1), 62-76.

Anser, M. K., Yousaf, S. U., Usman, B., Azam, K., Bandar, N. F. A., Jambari, H., ... & Zaman, K. (2023). Beyond climate change: Examining the role of environmental justice, agricultural mechanization, and social expenditures in alleviating rural poverty. Sustainable Futures, 6, 100130.

Asni, N., & Agustia, D. (2022). Does corporate governance induce green innovation? An emerging market evidence. Corporate Governance: The International Journal of Business in Society, 22(7), 1375-1389.

Arici, H. E., & Uysal, M. (2022). Leadership, green innovation, and green creativity: A systematic review. The Service Industries Journal, 42(5-6), 280-320.

Awan, F. H., Dunnan, L., Jamil, K., & Gul, R. F. (2023). Stimulating environmental performance via green human resource management, green transformational leadership, and green innovation: a mediation-moderation model. Environmental Science and Pollution Research, 30(2), 2958-2976.

Begum, S., Ashfaq, M., Xia, E., & Awan, U. (2022). Does green transformational leadership lead to green innovation? The role of green thinking and creative process engagement. Business Strategy and the Environment, 31(1), 580-597.

Burdon, W. M., & Sorour, M. K. (2020). Institutional theory and evolution of ‘a legitimate’compliance culture: The case of the UK financial service sector. Journal of Business Ethics, 162, 47-80.

Chaihanchanchai, P., & Anantachart, S. (2023). Encouraging green product purchase: Green value and environmental knowledge as moderators of attitude and behavior relationship. Business Strategy and the Environment, 32(1), 289-303.

Chaudhary, R. (2020). Green human resource management and employee green behavior: an empirical analysis. Corporate Social Responsibility and Environmental Management, 27(2), 630-641.

Chang, S. J., Van Witteloostuijn, A., & Eden, L. (2020). Common method variance in international business research. Research methods in international business, 385-398.

Chen, J., & Liu, L. (2020). Customer participation, and green product innovation in SMEs: The mediating role of opportunity recognition and exploitation. Journal of Business Research, 119, 151-162.

Choi, Y., & Woo, H. (2022). Understanding diverse types of performance information use: evidence from an institutional isomorphism perspective. Public Management Review, 24(12), 2033-2052.

Çop, S., Olorunsola, V. O., & Alola, U. V. (2021). Achieving environmental sustainability through green transformational leadership policy: Can green team resilience help?. Business Strategy and the Environment, 30(1), 671-682.

Couper, M. P. (2017). New developments in survey data collection. Annual review of sociology, 43(1), 121-145.

Crossley, R. M., Elmagrhi, M. H., & Ntim, C. G. (2021). Sustainability and legitimacy theory: The case of sustainable social and environmental practices of small and medium‐sized enterprises. Business Strategy and the Environment, 30(8), 3740-3762.

Dash, G., & Paul, J. (2021). CB-SEM vs PLS-SEM methods for research in social sciences and technology forecasting. Technological Forecasting and Social Change, 173, 121092.

Dangelico, R. M. (2016). Green product innovation: Where we are and where we are going. Business Strategy and the Environment, 25(8), 560-576.

Esmaeilpour, M., & Bahmiary, E. (2017). Investigating the impact of environmental attitude on the decision to purchase a green product with the mediating role of environmental concern and care for green products. Management & Marketing, 12(2), 297-315.

Farrukh, M., Ansari, N., Raza, A., Wu, Y., & Wang, H. (2022). Fostering employee's pro-environmental behavior through green transformational leadership, green human resource management and environmental knowledge. Technological Forecasting and Social Change, 179, 121643.

Fernando, Y., Jabbour, C. J. C., & Wah, W. X. (2019). Pursuing green growth in technology firms through the connections between environmental innovation and sustainable business performance: does service capability matter?. Resources, conservation and recycling, 141, 8-20.

Glover, J. L., Champion, D., Daniels, K. J., & Dainty, A. J. (2014). An Institutional Theory perspective on sustainable practices across the dairy supply chain. International Journal of Production Economics, 152, 102-111.

Glynn, M. A., & D’aunno, T. (2023). An intellectual history of institutional theory: Looking back to move forward. Academy of Management Annals, 17(1), 301-330.

Grob, S., & Benn, S. (2014). Conceptualising the adoption of sustainable procurement: an institutional theory perspective. Australasian journal of environmental management, 21(1), 11-21.

Guenther, P., Guenther, M., Ringle, C. M., Zaefarian, G., & Cartwright, S. (2023). Improving PLS-SEM use for business marketing research. Industrial Marketing Management, 111, 127-142.

Gupta, A. K., & Gupta, N. (2021). Environment practices mediating the environmental compliance and firm performance: An institutional theory perspective from emerging economies. Global Journal of Flexible Systems Management, 22(3), 157-178.

Hameed, Z., Naeem, R. M., Hassan, M., Naeem, M., Nazim, M., & Maqbool, A. (2022). How GHRM is related to green creativity? A moderated mediation model of green transformational leadership and green perceived organizational support. International Journal of Manpower, 43(3), 595-613.

Hair Jr, J. F., Howard, M. C., & Nitzl, C. (2020). Assessing measurement model quality in PLS-SEM using confirmatory composite analysis. Journal of business research, 109, 101-110.

Huang, Y. C., & Chen, C. T. (2022). Exploring institutional pressures, firm green slack, green product innovation and green new product success: Evidence from Taiwan's high-tech industries. Technological Forecasting and Social Change, 174, 121196.

Huang, Y. C., & Chen, C. T. (2023). Institutional pressure, firm's green resources and green product innovation: evidence from Taiwan's electrical and electronics sector. European Journal of Innovation Management, 26(3), 636-664.

Hulland, J., Baumgartner, H., & Smith, K. M. (2018). Marketing survey research best practices: evidence and recommendations from a review of JAMS articles. Journal of the Academy of Marketing Science, 46, 92-108.

Jabbour, C. J. C., & de Sousa Jabbour, A. B. L. (2016). Green human resource management and green supply chain management: Linking two emerging agendas. Journal of cleaner production, 112, 1824-1833.

Kam‐Sing Wong, S. (2012). The influence of green product competitiveness on the success of green product innovation: Empirical evidence from the Chinese electrical and electronics industry. European Journal of Innovation Management, 15(4), 468-490.

Khan, S. J., Dhir, A., Parida, V., & Papa, A. (2021). Past, present, and future of green product innovation. Business Strategy and the Environment, 30(8), 4081-4106.

Larsen, M. L. (2022). Driving global convergence in green financial policies: China as policy pioneer and the EU as standard setter. Global Policy, 13(3), 358-370.

Li, J. (2022). Can technology-driven cross-border mergers and acquisitions promote green innovation in emerging market firms? Evidence from China. Environmental Science and Pollution Research, 29(19), 27954-27976.

Li, W., Bhutto, T. A., Xuhui, W., Maitlo, Q., Zafar, A. U., & Bhutto, N. A. (2020). Unlocking employees’ green creativity: The effects of green transformational leadership, green intrinsic, and extrinsic motivation. Journal of cleaner production, 255, 120229.

Ma, R., & Sambharya, R. B. (2024). International diversification and corporate social responsibility disclosure quality: Employee versus environmental dimensions. Corporate Social Responsibility and Environmental Management. 31, 4248–4264.

Majali, T. E., Alkaraki, M., Asad, M., Aladwan, N., & Aledeinat, M. (2022). Green transformational leadership, green entrepreneurial orientation and performance of SMEs: The mediating role of green product innovation. Journal of Open Innovation: Technology, Market, and Complexity, 8(4), 191.

Meyer, R. E., & Höllerer, M. A. (2014). Does institutional theory need redirecting?. Journal of management Studies, 51(7), 1221-1233.

Moser, A., & Korstjens, I. (2018). Series: Practical guidance to qualitative research. Part 3: Sampling, data collection and analysis. European journal of general practice, 24(1), 9-18.

Mishra, P. (2017). Green human resource management: A framework for sustainable organizational development in an emerging economy. International Journal of Organizational Analysis, 25(5), 762-788.

Moin, M. F., Omar, M. K., Wei, F., Rasheed, M. I., & Hameed, Z. (2021). Green HRM and psychological safety: How transformational leadership drives follower’s job satisfaction. Current issues in Tourism, 24(16), 2269-2277.

Morgeson, F. P., DeRue, D. S., & Karam, E. P. (2010). Leadership in teams: A functional approach to understanding leadership structures and processes. Journal of management, 36(1), 5-39.

Mousa, S. K., & Othman, M. (2020). The impact of green human resource management practices on sustainable performance in healthcare organisations: A conceptual framework. Journal of cleaner production, 243, 118595.

Munawar, S., Yousaf, H. Q., Ahmed, M., & Rehman, S. (2022). Effects of green human resource management on green innovation through green human capital, environmental knowledge, and managerial environmental concern. Journal of Hospitality and Tourism Management, 52, 141-150.

Naz, S., Jamshed, S., Nisar, Q. A., & Nasir, N. (2023). Green HRM, psychological green climate and pro-environmental behaviors: An efficacious drive towards environmental performance in China. Current Psychology, 42(2), 1346-1361.

Nguyen, T. H., Van, H. V., Afifa, M. A., & Nguyen, N. M. (2024). Environmental corporate social responsibility and environmental performance: The role of green human resource management and green transformational leadership. Global Business Review, 09721509241226576.

Niazi, U. I., Nisar, Q. A., Nasir, N., Naz, S., Haider, S., & Khan, W. (2023). Green HRM, green innovation and environmental performance: The role of green transformational leadership and green corporate social responsibility. Environmental Science and Pollution Research, 30(15), 45353-45368.

Rana, G., & Arya, V. (2024). Green human resource management and environmental performance: mediating role of green innovation–a study from an emerging country. foresight, 26(1), 35-58.

Riva, F., Magrizos, S., & Rubel, M. R. B. (2021). Investigating the link between managers' green knowledge and leadership style, and their firms' environmental performance: The mediation role of green creativity. Business Strategy and the Environment, 30(7), 3228-3240.

Risi, D., Vigneau, L., Bohn, S., & Wickert, C. (2023). Institutional theory‐based research on corporate social responsibility: Bringing values back in. International Journal of Management Reviews, 25(1), 3-23.

Rizvi, Y. S., & Garg, R. (2021). The simultaneous effect of green ability-motivation-opportunity and transformational leadership in environment management: the mediating role of green culture. Benchmarking: An International Journal, 28(3), 830-856.

Sachdeva, C., & Singh, T. (2024). Green transformational leadership and pro-environmental behaviour: unravelling the underlying mechanism in the context of hotel industry. International Journal of Organizational Analysis, 32(2), 255-271.

Saeed, B. B., Afsar, B., Hafeez, S., Khan, I., Tahir, M., & Afridi, M. A. (2019). Promoting employee's proenvironmental behavior through green human resource management practices. Corporate Social Responsibility and Environmental Management, 26(2), 424-438.

Sahin, K., & Mert, K. (2023). Institutional theory in international business studies: the period of period of 1990–2018. International Journal of Organizational Analysis, 31(5), 1957-1986.

Sarstedt, M., Radomir, L., Moisescu, O. I., & Ringle, C. M. (2022). Latent class analysis in PLS-SEM: A review and recommendations for future applications. Journal of Business Research, 138, 398-407.

Santos, F. M., & Eisenhardt, K. M. (2009). Constructing markets and shaping boundaries: Entrepreneurial power in nascent fields. Academy of Management Journal, 52(4), 643-671.

Shahzad, M. A., Jianguo, D., & Junaid, M. (2023). Impact of green HRM practices on sustainable performance: mediating role of green innovation, green culture, and green employees’ behavior. Environmental Science and Pollution Research, 30(38), 88524-88547.

Shibin, K. T., Dubey, R., Gunasekaran, A., Hazen, B., Roubaud, D., Gupta, S., & Foropon, C. (2020). Examining sustainable supply chain management of SMEs using resource based view and institutional theory. Annals of Operations Research, 290, 301-326.

Singh, S. K., Del Giudice, M., Chierici, R., & Graziano, D. (2020). Green innovation and environmental performance: The role of green transformational leadership and green human resource management. Technological forecasting and social change, 150, 119762.

Song, W., Yu, H., & Xu, H. (2021). Effects of green human resource management and managerial environmental concern on green innovation. European journal of innovation management, 24(3), 951-967.

Srivastava, S., Pathak, D., Soni, S., & Dixit, A. (2024). Does green transformational leadership reinforce green creativity? The mediating roles of green organizational culture and green mindfulness. Journal of Organizational Change Management, 37(3), 619-640.

Stabler, D., Hakala, H., Huikkola, T., & Mention, A. L. (2024). Aligning servitization and circularity: The role of institutional confluence in sustainable business models. Journal of Cleaner Production, 142666.

Tahir, R., Athar, M. R., & Afzal, A. (2020). The impact of greenwashing practices on green employee behaviour: Mediating role of employee value orientation and green psychological climate. Cogent Business & Management, 7(1), 1781996.

Tian, H., Zhang, J., & Li, J. (2020). The relationship between pro-environmental attitude and employee green behavior: the role of motivational states and green work climate perceptions. Environmental Science and Pollution Research, 27(7), 7341-7352.

Tolmie, C. R., Lehnert, K., & Zhao, H. (2020). Formal and informal institutional pressures on corporate social responsibility: A cross‐country analysis. Corporate Social Responsibility and Environmental Management, 27(2), 786-802.

Usakli, A., & Rasoolimanesh, S. M. (2023). Which SEM to use and what to report? A comparison of CB-SEM and PLS-SEM. In Cutting edge research methods in hospitality and tourism (pp. 5-28). Emerald Publishing Limited.

Ushie, A. M., Jiang, X., Ali, A., Nwoba, A. C., & Hossain, S. F. A. (2023). Green innovation in emerging economies: The role of managerial ties and market learning. Business Strategy and the Environment, 32(6), 3513-3528.

Willmott, H. (2015). Why institutional theory cannot be critical. Journal of Management Inquiry, 24(1), 105-111.

Wry, T., Cobb, J. A., & Aldrich, H. E. (2013). More than a metaphor: Assessing the historical legacy of resource dependence and its contemporary promise as a theory of environmental complexity. Academy of Management annals, 7(1), 441-488.

Yeşiltaş, M., Gürlek, M., & Kenar, G. (2022). Organizational green culture and green employee behavior: Differences between green and non-green hotels. Journal of Cleaner Production, 343, 131051.

Younis, Z., & Hussain, S. (2023). Green transformational leadership: bridging the gap between green HRM practices and environmental performance through green psychological climate. Sustainable Futures, 6, 100140.

Yong, J. Y., Yusliza, M. Y., Ramayah, T., Farooq, K., & Tanveer, M. I. (2022). Accentuating the interconnection between green intellectual capital, green human resource management and sustainability. Benchmarking: An International Journal, 30(8), 2783-2808.

Zacher, H., Rudolph, C. W., & Katz, I. M. (2023). Employee green behavior as the core of environmentally sustainable organizations. Annual Review of Organizational Psychology and Organizational Behavior, 10(1), 465-494.

Zeng, J., Yang, Y., & Lee, S. H. (2023). Resource orchestration and scaling‐up of platform‐based entrepreneurial firms: the logic of dialectic tuning. Journal of Management Studies, 60(3), 605-638.

Zhang, J., Liang, G., Feng, T., Yuan, C., & Jiang, W. (2020). Green innovation to respond to environmental regulation: how external knowledge adoption and green absorptive capacity matter?. Business Strategy and the Environment, 29(1), 39-53.

Zhang, X., Khurshid, A., Zahra, K., Haider, S. N., & Hanif, M. S. (2024). The nexus of green innovation, cleaner production, and eco-efficiency and their role in environmental sustainability. Gondwana Research.

Zhou, S., Zhang, D., Lyu, C., & Zhang, H. (2018). Does seeing “mind acts upon mind” affect green psychological climate and green product development performance? The role of matching between green transformational leadership and individual green values. Sustainability, 10(9), 3206.

Zhou, J., Sawyer, L., & Safi, A. (2021). Institutional pressure and green product success: the role of green transformational leadership, green innovation, and green brand image. Frontiers in psychology, 12, 704855.