Cultivating sustainable innovation: The role of environmental leadership in improving innovation performance

Abstract

This study explores the complex connections between green innovation, environmental leadership, innovation climate, and innovation performance in organizations within Saudi Arabia's industrial sectors. The research aims to uncover the detailed interactions among these factors and highlight their importance in a region known for its environmental challenges and industrial significance. A detailed survey involving 251 participants was conducted, and the data was analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM). The study investigates how innovation climate mediates the relationship between green innovation and innovation performance and how environmental leadership modifies this relationship. The findings emphasize the critical role of green innovation and show a positive link between innovation performance and innovation climate. Environmental leadership is identified as crucial in enhancing the positive effects of green innovation on performance. However, an unexpected negative relationship between innovation climate and innovation performance was found, indicating that more research is needed in this area. These results are significant for organizational leaders who are trying to manage sustainability, leadership, and innovation amidst changing environmental and economic conditions.