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

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.

Toward Sustainable Development: The Causes and Consequences of Organizational Innovation

“…This study will investigate the incorporation of relevant aspects of ESG into organizational innovation and investigate its influencing factors on innovation. Niu et al [14] have previously investigated the relationship between digital leadership, ESG management, organizational innovation, and sustainability. However, as the environment changes, corporations are increasingly adopting ESG methods and regulations, and while the previous literature on the integration of ESG into business models has shown it is worth increasing and investing in, this literature on ESG and business model innovation is still only at the analytical framework stage.…”

“…The development of organizational innovation is an urgent issue for modern enterprises. The study by Niu et al [14] examined the impact of digital leadership and ESG management on organizational innovation and sustainability. The study also mentioned that organi-zational innovation has a positive impact on performance, competitive advantage, and sustainability [41].…”

ESG Investment Scale Allocation of China’s Power Grid Company Using System Dynamics Simulation Modeling

“…In order to pursue long-term sustainable investment returns, the enterprise investment concept with ESG as the core emerged at a historic moment [ 1 ]. Many scholars have studied the relationship between ESG investment and the sustainable development of enterprises and confirmed that the improvement of enterprises’ operating efficiency depends on their ESG performance [ 2 , 3 , 4 , 5 ]. After decades of research and development, ESG investment has become the mainstream of investment activities in the global capital market [ 6 , 7 ].…”

Pengaruh Kinerja Esg Terhadap Nilai Perusahaan Dengan Siklus Hidup Perusahaan Sebagai Moderasi : Bukti Dari Indonesia

“…CSR dan ESG (Environmental, Social and Governance) pada dasarnya memiliki aspek yang mirip yaitu cara perusahaan untuk memperlihatkan kepeduliannya terhadap dampak dari aktivitas bisnis yang dijalaninya dengan berfokus pada kelestarian lingkungan dan pelayanan sosial kepada masyarakat. Namun, ESG menjadi terminologi yang lebih luas dibandingkan dengan CSR (Niu et al, 2022). Menurut Gibson et al (2020) ESG mengacu pada kepentingan dalam keputusan investor seperti istilah "ESG Investing", Homepage : http://journal.ubm.ac.id/index.php/akuntansi-bisnis/ 228 "Responsible Investing", "Impact Investing" yang merupakan istilah lebih luas bagi investor yang mengintegrasikan aspek ESG kedalam keputusan investasi mereka.…”