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The Effects of Digital Leadership and ESG Management on Organizational Innovation and Sustainability

Author

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  • SiJian Niu

    (Department of International Business, Chungbuk National University, Cheongju 28644, Republic of Korea)

  • Byung Il Park

    (College of Business, Hankuk University of Foreign Studies, Seoul 02450, Republic of Korea)

  • Jin Sup Jung

    (Department of International Business, Chungbuk National University, Cheongju 28644, Republic of Korea)

Abstract

Companies around the world have recognized that environmental issues and social values constitute some of the most important management concerns and have actively introduced environmental, social, and governance management (ESG management, ESGM). In the digital age, an attempt is also often made to incorporate digital transformation into ESGM. However, research on the combination of digital leadership, ESGM, and organizational innovation is still in its early stages. Therefore, in this study, a research model was constructed by combining ESGM and organizational innovation (OI) from the perspective of digital leadership (DL). Specifically, for achieving organizational sustainability (OS), the mediating effect of two variables—ESGM and organizational innovation—was also explored, and empirical analysis was conducted on Korean and Chinese companies. We took into consideration the premise that the impact of digital leadership, ESGM, and organizational innovation on organizational sustainability could be different due to the differences in the cultures and systems of the two countries. For empirical analysis, partial least squares structural equation modeling (PLS-SEM) was used. The results showed that digital leadership in both countries had a significant effect on ESGM and organizational innovation. Specifically, both digital leadership and ESGM together with organizational innovation played an important role in organizational sustainability in the entire model. However, between digital leadership and organizational sustainability, the mediating effect of ESGM and organizational innovation was different, viz., Korea had partial mediating effects and China had complete mediating effects. It is expected that this study would fill the research gap in the area of digital leadership in ESGM and contribute to the implementation of corporate ESGM strategies and organizational innovation. Furthermore, valuable implications for organizational sustainability and the sustainable growth of companies are also presented.

Suggested Citation

  • SiJian Niu & Byung Il Park & Jin Sup Jung, 2022. "The Effects of Digital Leadership and ESG Management on Organizational Innovation and Sustainability," Sustainability, MDPI, vol. 14(23), pages 1-20, November.
    • Handle: RePEc:gam:jsusta:v:14:y:2022:i:23:p:15639-:d:982947
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    2. Irina A. Morozova & Anastasia I. Smetanina & Anton S. Smetanin, 2023. "ESG Management of Sustainable Business Development in the Context of Digital Transformation of the Russian Economy," Journal of Applied Economic Research, Graduate School of Economics and Management, Ural Federal University, vol. 22(2), pages 425-449.
    3. Xiaoxu Zhang & Xinyu Du, 2023. "Industry and Regional Peer Effects in Corporate Digital Transformation: The Moderating Effects of TMT Characteristics," Sustainability, MDPI, vol. 15(7), pages 1-22, March.
    4. Li-Min Chuang & Yu-Po Lee, 2023. "Toward Sustainable Development: The Causes and Consequences of Organizational Innovation," Sustainability, MDPI, vol. 15(10), pages 1-22, May.
    5. Li Li & Xinwen Bai & Yiyong Zhou, 2023. "A Social Resources Perspective of Employee Innovative Behavior and Outcomes: A Moderated Mediation Model," Sustainability, MDPI, vol. 15(3), pages 1-19, February.
    6. Birong Huang & Zilong Wang & Yuan Gu, 2023. "ESG Investment Scale Allocation of China’s Power Grid Company Using System Dynamics Simulation Modeling," IJERPH, MDPI, vol. 20(4), pages 1-16, February.
    7. Memon, Khalid Rasheed & Ooi, Say Keat, 2023. "Identifying digital leadership's role in fostering competitive advantage through responsible innovation: A SEM-Neural Network approach," Technology in Society, Elsevier, vol. 75(C).

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