Leadership Dimensions Influencing Sustainability Leadership in Sri Lanka: Mediating Effect of Managers’ Ethical Behaviour and Organizational Change

Abstract

This study examines the mediation effect of managers’ ethical behaviour and organizational change on the leadership dimensions that influence sustainability leadership among Sri Lankan managers. Manager’s attitudes to organizational change and their ethical behaviour are identified as essential dimensions to achieve sustainable leadership in the business world. While much of the literature underlines the direct relationship between organizational leadership and either organizational change or manager’s ethical behaviour, only a few studies focus on the mediating effect of the manager’s ethical behaviour and organizational change leadership on perceptions of creating a sustainable organization. Sri Lanka is identified as a developing country with strong socio-cultural values that promote sustainability. Understanding what constitutes sustainability leadership in a developing country such as Sri Lanka is worth examining. The responses of 596 managers were analyzed using factor analysis and structural equation modeling. The findings confirm that stakeholder relations are the most influential dimension for creating sustainability leadership. Mediation analysis tests confirmed that the two mediators of managers’ ethical behaviour and change leadership fully mediate the relationships between employee engagement and leaders’ concern for social and environmental sustainability, which concern was identified as the weakest of the three leadership dimensions suggesting that long-term orientation has not much potential for creating sustainability leadership among Sri Lankan managers.