The Influence of Green Transformational Leadership on Employee Green Creativity Mediated by Green Management Initiatives in Creative MSMEs in DIY

Abstract

Creating creative MSMEs that can tackle environmental challenges while also remaining competitive and adaptable to market trends is crucial. Implementing green transformational leadership can guide environmental action, but its impact on employees' green creativity may be shaped by practical management strategies. This research investigates the impact of green transformational leadership on employees' green creativity and the mediating role of management green initiatives in the Special Region of Yogyakarta (DIY). The study used purposive sampling to collect quantitative data from 118 employees and employed PLS-SEM to analyze direct, indirect, and total effects. The results show that green transformational leadership has a positive, significant effect on management green initiatives, and management green initiatives, in turn, have a positive, significant effect on employees' green creativity. The direct effect of green transformational leadership on employees' green creativity is not significant, while the indirect effect through management green initiatives is significant; the total effect is negligible and non-significant. These results indicate indirect-only (full) mediation, whereby management green initiatives fully channel green leadership's influence on employees' green creativity, underscoring that green leadership requires concrete management initiatives to shape green creativity.