Effect of Resilient Leadership on Sustainable Business Performance through Enterprise Innovation and the Moderating Role of Executive Incentives

Abstract

Leaders' resilience plays a significant role in organizational competitiveness, yet no scholars have proposed a definition of resilient leadership in the manufacturing industries. Therefore, the relationship between resilient leadership and sustainable business performance in the manufacturing industries has become a new topic for research. Accordingly, this study sampled 500 manufacturers operating in Jiangxi - a large manufacturing province in China. A questionnaire was administered to collect the data, adopting a stratified sampling method. A structural equation model was developed to empirically examine the relationship between variables. In particular, path analysis and decomposition effect methods were used to examine the direct impact of resilient leadership on sustainable business performance; and the indirect effect of introducing enterprise innovation as a mediating variable. This study used the hierarchical regression analysis method to test the moderating effect of executive incentives. The research results revealed that: (1) resilient leadership had a significantly positive impact on sustainable business performance, (2) enterprise innovation played a mediating role between resilient leadership and sustainable business performance, and (3) the moderating effect of executive incentives was established. Findings of the study are beneficial for practitioners and will allow their strategies to reflect sustainable competitive advantages and sustainable business performance.