Leadership strategy as the driver of achieving sustainable business: A case of endek weaving SMEs in Indonesia

The sustainable performance of the endek ikat weaving business is essential for the growth of small and medium enterprises and the local economy of Bali (Indonesia). This study intends to examine the direct effects of green entrepreneurial orientation and sustainable leadership on endek weaving SME performance, as well as their indirect effects through the mediation of green digital innovation. This analysis was conducted on endek ikat weaving SMEs in the province of Bali. The population included 1,391 management personnel. Using the proportional random sampling, the study selected 311 respondents. The research hypotheses were tested using a questionnaire distributed among SME management in Bali. Research data were analyzed using the PLS-SEM method and SmartPLS 3 as the analytical tool. The results revealed that sustainable leadership affects green digital innovation (β = 0.483, t-statistic = 5.968). Green entrepreneurial orientation affects sustainable performance and green digital innovation (β = 0.240, 0.445; t-statistic = 2.858, 5.457). Moreover, green digital innovation has the potential to mediate the effect of sustainable leadership and green entrepreneurial orientation toward sustainable performance (β = 0.317, 0.292; t-statistic = 4.184, 4.645). By integrating leadership strategies with a green entrepreneurial approach, as well as innovating through digital media, Balinese endek weaving SMEs can improve their performance to achieve business sustainability. AcknowledgmentsThis is independent research that has not been funded by any institution. We would like to thank all parties who have provided immaterial support for this investigation.