Strategic Pathways to Corporate Sustainability: The Roles of Transformational Leadership, Knowledge Sharing, and Innovation

Ahmad Alqatan, Walid Simmou, Maha Shehadeh, Faisal AlReshaid, Mahmoud Elmarzouky () and Doaa Shohaieb
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Ahmad Alqatan: Business Department, Arab Open University, Al-Safat 13033, Kuwait
Walid Simmou: Faculty of Law, Economic, and Social Sciences, Ibn Zohr University, Taroudant 83000, Morocco
Maha Shehadeh: Department of Financial Technology, Business School, Al-Ahliyya Amman University, Amman 19328, Jordan
Faisal AlReshaid: College of Business & Economics, American University of Kuwait, Safat 13034, Kuwait
Mahmoud Elmarzouky: St Andrews Business School, University of St. Andrews, St. Andrews KY16 9RJ, UK
Doaa Shohaieb: Faculty of Business, Menoufia University, Menofia 32721, Egypt

Sustainability, 2025, vol. 17, issue 12, 1-22

Abstract: Corporate sustainability has emerged as a critical imperative for firms navigating volatile markets and ecological constraints, yet the mechanisms linking organizational practices to sustainability outcomes remain underexplored, particularly in developing economies. Drawing on the resource-based view and dynamic capabilities theory, this paper examines how transformational leadership and knowledge sharing synergistically enhance innovation capability, which in turn fosters environmental dynamism and corporate sustainability performance. Using a structured questionnaire within a cross-sectional design to gather data from 140 Moroccan SMEs, data were collected via an online questionnaire from 140 Moroccan SME owners and managers, with hypotheses tested using partial least squares structural equation modeling (PLS-SEM). The results show that knowledge sharing, and transformational leadership significantly strengthen innovation capability. Innovation capability further drives environmental dynamism, which positively impacts sustainability performance. These findings advance theory by integrating knowledge-based, leadership, and dynamic capability perspectives into a novel pathway for achieving sustainability goals. The study underscores the necessity for SMEs in developing nations to cultivate leadership that inspires knowledge exchange and adaptive innovation, enabling resilience amid ecological and market shifts. By highlighting these internal drivers, the research offers actionable insights for SMEs and policymakers seeking to align business innovation strategies with sustainability objectives and pro-environmental transformation in line with the UN Sustainable Development Goals (SDGs).

Keywords: corporate sustainability performance; environmental dynamism; innovation capability; knowledge sharing; transformational leadership; Morocco; SME; sustainable innovation; SDGs (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2025
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