EMPOWERING GREEN ORGANISATIONAL PERFORMANCE: THE ROLE OF TRANSFORMATIONAL LEADERSHIP, GREEN INNOVATION BEHAVIOUR, AND STAKEHOLDER ENGAGEMENT

This study examines how green transformational leadership contributes to green organisational performance by activating innovation-related mechanisms within organisations. Drawing on an innovation management perspective, the study focuses on the mediating role of stakeholder engagement and the moderating effect of employee green innovative behaviour, conceptualised as a micro-level innovation capability. Using a random sampling technique, data were collected through an online survey from 241 employees across various organisations in the United Arab Emirates. Partial Least Squares Structural Equation Modelling (PLS-SEM) was employed to test the proposed relationships. The findings demonstrate that green transformational leadership has a significant positive effect on green organisational performance. Stakeholder engagement partially mediates this relationship, indicating that leadership-driven sustainability orientations translate into performance outcomes through collaborative, innovation-enabling stakeholder processes. Furthermore, employee green innovative behaviour moderates the relationship between green transformational leadership and stakeholder engagement, such that the effectiveness of leadership in mobilising stakeholders varies depending on employees’ proactive engagement in green innovation. By positioning employee green innovative behaviour as an innovation-relevant behavioural capability, this study contributes to the innovation management literature by explaining how leadership, employee innovation behaviour, and stakeholder engagement jointly shape sustainability-oriented organisational outcomes. The findings offer practical insights for organisations seeking to leverage innovation-driven leadership and employee initiative to enhance environmental performance, particularly in underexplored contexts such as the UAE.