Revisiting Ecological Modernization in Technology Management: Digital Leadership, Circular Economy, and Orientation for Sustainable Performance

ABSTRACT Manufacturing firms increasingly face pressure to achieve sustainable performance while responding to resource constraints, environmental regulations, and technological disruptions. Drawing on ecological modernization theory, this study investigates how digital leadership influences organizational performance through circular economy capability and environmental performance and examines the moderating effect of technological orientation. Data were collected through a two‐wave survey of 278 textile manufacturing firms in Pakistan and analyzed using partial least squares structural equation modeling (PLS‐SEM), importance–performance map analysis (IPMA), and necessary condition analysis (NCA). The findings indicate that digital leadership is positively associated with circular economy capability, which is subsequently associated with stronger environmental and organizational performance. Circular economy capability and environmental performance serve as significant mediators through which digital leadership contributes to organizational outcomes. Additionally, technological orientation strengthens the positive relationship between circular economy capability and organizational performance. NCA further demonstrates that digital leadership and circular economy capability are necessary conditions for achieving higher organizational performance. IPMA identifies circular economy capability as the most critical managerial priority due to its high importance and potential for improvement. This study extends ecological modernization theory by demonstrating that sustainable transformation depends on the alignment of leadership capabilities, circular capability development, and technological readiness, providing valuable insights for sustainability‐oriented transformation in emerging manufacturing contexts.