Servant Leadership and Innovative Behaviour: The Mediating Roles of Psychological Safety and Thriving at Work

Background: In dynamic business environments, organisational innovation is pivotal for sustaining competitive advantage. Servant leadership, emphasising follower empowerment and well-being, fosters innovative behaviour by enhancing psychological safety and thriving at the workplace. This study addresses underexplored mediation mechanisms in high-power-distance cultures, where hierarchical norms may constrain creativity, offering insights into Southeast Asian innovation pathways. Objectives: This study investigates how servant leadership fosters innovative behaviour through psychological safety and thriving at the workplace, providing empirical insights to enhance innovation in hierarchical, high-power-distance organisational contexts such as Indonesia. Methodology: Data were collected from 252 employees of a state-owned logistics firm using 5-point Likert scales. PLS-SEM and a two-stage approach evaluated the multidimensional structure of thriving, testing the direct and mediated effects of servant leadership on innovation through psychological safety and thriving at the workplace. Results: Servant leadership directly enhanced innovative behaviour, with psychological safety and thriving at the workplace mediating this relationship significantly, particularly within state-owned logistics firms operating under structured cultural and organisational norms. Conclusion: When servant leaders prioritise employee needs, behave ethically, and have strong emotional bonds, employees feel psychologically safe to voice ideas without fear of repercussions. This safety fosters enthusiasm and vitality for learning (thriving), allowing employees to experiment, which ultimately drives innovation. Unique Contribution: This study demonstrates how servant leadership drives innovation through psychological safety and employee thriving. It highlights how insufficient psychological safety reduces the effectiveness of servant leadership’s potential to stimulate innovative behaviours, even in culturally constrained environments. The findings emphasise actionable strategies for organisations to reduce hierarchical barriers, promote open communication, and foster environments where employees feel safe to experiment and grow. Recommendation: Servant leadership training should be a top priority for organisations. Establish open forums and allocate resources to reduce hierarchy and foster a culture of psychological safety, enabling employees to innovate without fear of failure.