The Mediating Effects of Green Innovation and Corporate Social Responsibility on the Link between Transformational Leadership and Performance: An Examination Using SEM Analysis

Abstract

Since the inauguration of the United Nations Sustainable Development Goals (UNSDGs), environmental performance and sustainability have become more important to decision makers, scientists and leaders of organizations than before. In response to this, leaders of different organizations spend all endeavors conserving resources and ensuring environmental sustainability. In this context, transformational leaders have the capacity to ensure the green performance of their organization. The purpose of this study is to test the link between green transformational leadership (GTL), green innovation (GI), corporate social responsibility (CSR) and green performance (GP) in the hotel industry in the Kingdom of Saudi Arabia (KSA). The study empirically tests the mediating effect of GI and CSR on the link between GTL and GP. The study used a quantitative research method via a pre-test instrument, self-distributed and collected from employees in large hotels at different regions of the KSA. The findings from 732 valid responses, analyzed with structural equation modeling (SEM) showed that GTL had a significant effect on GI (β = +0.72, t-value = 14.603, p < 0.001), CSR (β = +0.58, t-value = 8.511, p < 0.001) and GP (β = +0.17, t-value = 2.585, p < 0.001). Moreover, GI and CSR had a direct positive effect on GP (β = +0.10, t-value = 2.866, p < 0.01 and β = +0.61, t-value = 4.358, p < 0.001, respectively). GI had a partial mediation effect (p = 0.048 < 0.05) on the link between GTL and GP. On the other hand, CSR had a perfect mediation effect (p = 0.077 > 0.05) on the link between GTL and GP. This reflects the vital part that CSR plays in this relationship, which can be changed based on the status of CSR. In addition, this reflects the value of CSR in achieving GP, which contributes to the achievement of environmental sustainability at a national level (i.e., the Green Saudi Initiative) at a regional level (i.e., the Green Middle East Initiative) and at an international level (i.e., UNSDGs).