Impact of Transformational leadership Dimensions on environmental Performance of Small and medium Enterprises in Yemen.

Abstract

Sustainability has evolved from being an optional consideration to a mandatory requisite, particularly in light of the excessive exploitation of natural resources by developed nations in pursuit of profitability. This overconsumption has necessitated a shift towards sustainable practices, often prioritized through lean manufacturing, which is closely tied to profitability. However, this shift presents significant challenges for small and medium enterprises (SMEs), especially in developing countries, where the adoption of essential capabilities such as effective leadership is critical to addressing these issues. This study explores the relationship between transformational leadership and the environmental performance (EP) of manufacturing SMEs in Yemen, adopting a multidimensional approach. Data were gathered from 199 managers and owners of SMEs through a structured survey questionnaire, and the analysis was conducted using structural equation modeling. The findings, derived using PLS 4.0, reveal a positive and significant influence of individual consideration on EP, while other dimensions of transformational leadership—charisma, inspirational motivation, and intellectual stimulation—do not exhibit a significant effect on EP. These results provide actionable recommendations for stakeholders aiming to enhance the environmental performance of SMEs through targeted leadership strategies