Transformational Leadership, Organizational Culture and Sustainability at the Property Development Companies in Malaysia

Abstract

Sustainability is considered a significant element for property development industry. According to the United Nations General Assembly Brundtland Report, protecting the environment and the society in the midst of human seeking economic growth is at times taken for granted. The motivation behind this study is to seek deeper understanding of the role of transformational leadership in promoting sustainability in Malaysian property industry. The study aims to determine the relationship between transformational leadership and sustainability among the top management level at the property development companies in Malaysia, through the mediating effect of organisational culture that would lead to sustainability in terms of environmental, economy and society. The study employed a purposive sampling method with data collected from managerial level staffs from 100 property development companies in Malaysia. Multivariate data normality tests, descriptive statistics, and structural equation modelling through Smart PLS was used for data analysis. The findings of this study revealed a positive and significant relationship between transformational leadership and sustainability and also a significant positive relationship between transformational leadership and organisational culture namely bureaucratic culture, innovative culture and supportive culture. However, the results established insignificant relationship between organisational culture and sustainability and confirmed that organisational culture does not mediate the relationship between transformational leadership and sustainability. The results confirm that the real estate development company practicing leadership transformation at management level will promote sustainability. This study has contributed to the literature by introducing new empirical evidence not only in organisational studies on the role of transformational leadership practices in promoting sustainability, but also empirical evidence on the insignificant relationship between organisational culture and sustainability as well as the mediating role of organisational culture that is not evident between transformational leadership and sustainability in property development companies Malaysia. Therefore, this study recommended organisations to invest on transformational leadership trainings to support the leadership behaviours that encourages organisational culture that in turn supports sustainability.