Influence of green inclusive leadership on sustainable performance through innovative behavior: Moderating role of green psychological climate and climate for inclusion

Samo, Asif Hussain; Ahmed, Quratulain Nazeer; Rizvi, Syed Aamir Alam Article Influence of green inclusive leadership on sustainable performance through innovative behavior: Moderating role of green psychological climate and climate for inclusion Pakistan Journal of Commerce and Social Sciences (PJCSS) Provided in Cooperation with: Johar Education Society, Pakistan (JESPK) Suggested Citation: Samo, Asif Hussain; Ahmed, Quratulain Nazeer; Rizvi, Syed Aamir Alam (2024) : Influence of green inclusive leadership on sustainable performance through innovative behavior: Moderating role of green psychological climate and climate for inclusion, Pakistan Journal of Commerce and Social Sciences (PJCSS), ISSN 2309-8619, Johar Education Society, Pakistan (JESPK), Lahore, Vol. 18, Iss. 3, pp. 676-702 This Version is available at: https://hdl.handle.net/10419/305450 Standard-Nutzungsbedingungen: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden. 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If the documents have been made available under an Open Content Licence (especially Creative Commons Licences), you may exercise further usage rights as specified in the indicated licence. https://creativecommons.org/licenses/by-nc/4.0/ Pakistan Journal of Commerce and Social Sciences 2024, Vol. 18(3), 676-702 Pak J Commer Soc Sci Influence of Green Inclusive Leadership on Sustainable Performance through Innovative Behavior: Moderating Role of Green Psychological Climate and Climate for Inclusion Asif Hussain Samo Department of Business Administration, Sindh Madressatul Islam University, Karachi, Pakistan E-mail: asif.sam[email protected].pk Quratulain Nazeer Ahmed Department of Accounting, Banking & Finance, Sindh Madressatul Islam University, Karachi, Pakistan. E-mail: qn[email protected]u.pk Syed Aamir Alam Rizvi (Corresponding author) Department of Business Management, Institute of Business Management, Karachi, Pakistan E-mail: syedaamiralam[email protected]m Article History Received: 01 July 2024 Revised: 12 Sept 2024 Accepted: 21 Sep 2024 Published: 30 Sept 2024 Abstract This study explores the relationship between green inclusive leadership and sustainability performance with the mediating role of innovative behavior and the moderating role of green psychological climate and the climate of inclusion. Following the paradigm of positivism, this quantitative study collected data from 382 followers and 75 leaders from the health sector. The survey was conducted on reliable and valid instruments from the literature. Structural equation modeling through Smart PLS was used for data analysis. Results revealed that green, inclusive leadership impacts sustainable performance in the health sector directly and through innovative behavior. Moreover, a Green psychological climate and climate for inclusion moderate this relationship. The health sector that needs sustainable performance should cultivate green inclusive leadership at all levels and for that purpose, hospitals should initiate relevant training programs. Keywords: Climate for inclusion, green inclusive leadership; green psychological climate, innovative behavior, sustainability performance. 1. Introduction As the world enters new socioeconomic and technological realities, it becomes evident that diversity and inclusion are not only prudent from humanity's perspective but more Samo, Ahmed & Rizvi 677 productive from any perspective. Today, the data suggests that inclusive companies are 1.7 times more innovative (Bersin, 2019), witness 15-fold more sales in revenue (American Sociological Association, 2009), carry out innovative, wise, and timely decisions (DixonFyle et al., 2020), and attract better human capital from current generations (Glassdoor, 2021). Despite this promising evidence, the corporate world is still in dire need of a holistic, inclusive workplace environment. Sustainability is no longer a buzzword but a reality, and companies are in a desperate mood to pursue sustainable performance (Ali & Johl, 2022). Within the major scope of sustainability performance, green practices and being green in everything are the most significant aspects. The health sector is vital not only for the survival of human beings but also for its growth. However, the health sector is also notorious for deteriorating the environment (Lenzen et al., 2020), and it is also struggling to make the sector more inclusive. Research recommends strong and consistent green practices in the health sector to make it sustainable in the real sense (Pichler et al., 2019). Similarly, sustainability in health care is inextricably linked with inclusion and inclusive practices (Mitchell et al., 2024). It is an admitted fact that all these important decisions are the prime responsibility of the leaders of organizations, and the question to what extent these two dimensions, the inclusion in the approach of leadership and sustainability performance, are related has already captured the attention of researchers. This research, however, aims to explain the green orientation in inclusive leadership and its impact on sustainability performance through innovative behavior and the catalyst role of workplace climate. Leadership is one of the most discussed and researched phenomena in organizational studies, and therefore it is beyond its capacity to be labeled in a single definition and is deemed as a discursive phenomenon (Jian et al., 2016). However, the central role of a leader is to influence the decision-making in the organization. The diversity, in human resources or the ideas, and its related decisions are significant for the success of organizations from many perspectives, and fostering an inclusive and inclusive work environment is also theoretically and practically pivotal for firms. The approach of leaders, thus, becomes, important in the pursuit (Fife et al., 2021). The concept of inclusive leadership was mainly introduced in 2006 to highlight the role of leaders in appreciating the individual contribution of employees and accommodating their uniqueness and belongingness (Nembhard & Edmondson, 2006). However, the concept was developed as the leadership approach that makes leaders available, visible, and accessible to their followers in their interactions and in their ideas (Carmeli et al., 2010). Since then, inclusive leadership has been explored, tried, and tested successfully for several organizational outcomes, including, project success (Rehman, 2020), innovation (Wang et al., 2021), psychological capital (XIiang et al., 2017), work engagement (Bannay et al., 2020), selfefficacy (Javed et al., 2021), and other many required organizational objectives. This Green Inclusive Leadership - Innovative Behavior - Sustainable Performance 678 makes inclusive leadership not only relevant but important for organizations, it, however, works in amalgamation of different dimensions. The holistic conceptual understanding of inclusion suggests that organizations should create a work environment and regulations to accommodate the uniqueness of ideas, discussions, and people from diverse backgrounds. A few dimensions merge to make the significance of inclusion more visible, primarily, it is the diversity of people. Every organization is recommended to have people from diverse backgrounds (Ng & Sears, 2020), and to the most extent, organizations follow this practice, however, inclusion is going some extra mile than merely accommodating diverse people, as it is to ensure that the unique requirements and accessibility of the people are entertained timely, properly and without discrimination (Chiu, 2021). The second dimension is to be ready and encouraging about the ideas and practices in the organization since that complements the first dimension. Inclusive leadership becomes indispensable when organizations intend to work on the above dimensions of inclusion (Rafique et al., 2024) since it is the leadership that influences all this (Aboramadan et al., 2022). Inclusion leadership is therefore, making leaders available, visible, and accessible to ideas, practices, and people to foster green creativity (Sürücü, 2024) and greater innovation and performance (Carmeli et al., 2010). Organizational research takes all the exploration of causes and the treatment variable in pursuit of performance. The sustainability theory suggests that performance with the consummation of resources in a way to deplete them is not the optimum performance and should not be the goal, rather, performance that remains lasting with meager resources and with the option to reuse them should be the goal, that is called sustainable performance (Kantabutra, 2020). This demands novel ideas and practices, and consistent innovation is required in the organization. Another multi-dimensional quagmire that requires proper leadership influence is the complex nexus of innovation and sustainability. Diversity and inclusion theories recommend that organizations tend to be more innovative when they effectively bring diversity and inclusion into their work environment (Jones et al., 2020; Ozgen, 2021; Roh & Koo, 2019), and sustainability theory suggests that innovation and innovative behavior are prerequisites for sustainable performance. This leads to the understanding that leaders with inclusive orientation, especially with green inclusive orientation, are more likely to make relevant decisions to influence the above-mentioned quagmire to bring productive and desired results (Nejati & Shafaei, 2023). Green inclusive leadership caters to the concept of inclusiveness however with the approach to accommodating green ideas, being ready to pay heed to discussions about green practices, and being inspired enough towards environmental goals (Aboramadan et al., 2022). When leaders tend to be physical, visible, and accessible towards green ideas and practices, remain upfront to confront environmental challenges, and remain inclusive to their followers in this regard, they are deemed to be green inclusive leaders. The concept was born from the womb of phenomena of inclusive leadership, green behavior, and sustainability, it was introduced and developed in 2021 (Bhutto et al., 2021). The global Samo, Ahmed & Rizvi 679 efforts to decarbonize the world and mitigate the nonrenewable consumption of resources in all dimensions make it evident that a green approach in leadership is important and a leader who remains inclusive in acceptance of green ideas and novelty in dealing with the anti-green practices can influence more pro-environment decisions (Thabet et al., 2023), and thus play an indispensable role in generating sustainable performance. Nevertheless, it is important to extensively investigate the trajectory of green inclusive leadership towards sustainable performance and elucidate the mediators and catalysts thus enhancing the effectiveness of this connection. This study takes the lens of social exchange, social identity, and social learning theories into consideration for the development of the model. Social exchange theory (Cropanzano & Mitchell, 2005), gives the lens to see how inclusive leadership creates trust and openness in the workplace by showing readiness and acceptability of the ideas and thoughts and proenvironmental behavior, In exchange, the followers shall tend to show greater interest in bringing innovation in their work about environment and would strive for augmented proenvironment behavior and thus this shall create sustainability in the performance. Social identity theory (Ashforth & Mael, 1989) also provides an understanding of the effect of inclusive leadership in the organization, as when followers are provided the space and justice to identify themselves with their individuality and particularly belongingness, it creates inspiration and motivation for more desired performance. The behavior of followers in the way of leaders and organizations can also be justified by social learning theory (Crain, 2021), which says that employees usually learn to follow the norms of the organizations and the general culture. One of the prime prerequisites of sustainable performance is the innovative behavior of employees. Since sustainable performance requires new means of utilizing resources and this requires creativity and technological novelty to bring breakthroughs to current practices (Tantayanubutr & Panjakajornsak, 2017). Literature is replete with the leadership approaches and styles that have been tested and modeled to achieve the goal of innovation in organizational practices (Kesting et al., 2015). Inclusive leadership is inextricably linked with diversity which is explored in research as the backbone of creativity and innovation, therefore, inclusive leadership has also been researched to fetch innovation in the behavior of employees. Therefore, this study aims to test innovative behavior as a mediator in the relation of green inclusive leadership and sustainable performance. Any treatment or role leadership is augmented when trust and openness are present in the climate of the organization, similarly, there is a strong need to see the effect of relative climate and their moderating effects on inclusive leadership and sustainable performance. In this study, we are going to test exclusively the green psychological climate and climate for inclusion as catalysts. Green Inclusive Leadership - Innovative Behavior - Sustainable Performance 680 1.1 Theoretical Background Inclusive leadership is explored and explained through various lenses in the research, but in this study, we rely on three prime theories of psychology, social exchange theory, social identity theory, and social learning theory. Social exchange theory (SET) is used to understand workplace behavior. The prime utilization of social exchange theory in leadership studies is in the concept of leadermember exchange. It explains that when leaders tend to have better and more accommodating exchanges with their followers, it creates an obligation of favor, and that bounds the follower to reciprocate in equal and similar terms (Wayne et al., 1997). Social exchange theory can explain leadership studies that claim that leadership styles have an impact on employees' performance. When inclusive leaders shower the interactions of inclusion and accommodate the uniqueness of followers on those interactions, the followers tend to be obliged to return the favor in performance in like what the leaders expect. Social exchange theory also explains how leadership through social exchange, and not by economic exchange, can create a motivational drive in the followers to be creative in their tasks. When employees perform with individual creativity driven by social exchange it becomes a jumping pad for innovation (Zhang et al., 2018). Green inclusive leadership inspires the followers to be more innovative and generate sustainable performance, and since the interactions of leaders make followers oblige to meet expectations, it creates a positive impact. Social identity theory also provides a perspective on the role of leadership in the performance of employees. This theory explains how people create their identity and categorization in affiliation with individuals and groups in their surroundings (Brown, 2000). When people get a chance to identify themselves based on their prior beliefs and categorization it gives them space to remain confident, and when it is not provided to them, they struggle to create a new identity suitable to their new surroundings (Stets & Burke, 2000). Inclusive leadership provides that space for people where they can comfortably maintain their identities of their own without any compulsion. this is the prime approach of inclusive leadership. Thus, followers become psychologically strengthened and perform better. Social learning theory is yet another lens to explain how followers are lured towards the behavior which has definitions favorable to the norms of organizations. where it is explained as a comprehensive theory that can explain organizational behavior in line with the interaction of the variables working in an organization, including, environmental, cognitive, and behavioral determinants (Davis & Luthans, 1980). In leadership studies, social learning theory is mostly used to explain when leaders have an upright agenda to inspire their followers in organizations, for example, ethical leadership has been widely explained through the lens of social learning theory (Brown et al., 2005; Lian et al., 2022). Since inclusive leadership also takes an upright agenda, researchers have explained that inclusive leadership predicts and enhances performance, well-being (Cao et al., 2022), Samo, Ahmed & Rizvi 681 turnover intention, and organizational commitment (Lin et al., 2022). Moreover, if organizations intend to transform their organizations to be environmentally friendly in all dimensions, it is recommended to adopt green leadership approaches (Amjad et al., 2024) as it helps them to get support from the employees towards their environmental policies (Kardoyo et al., 2020). Green inclusive leadership aims to bring the utmost from employees in terms of innovation and sustainability towards being environmentally friendly and allow them to come up with their creativity in this regard. This upright agenda, it is believed, can be explained through social learning theory, as the followers shall learn to be more proenvironment as the policies, norms, and leadership approach shall conform to the proenvironment orientation. Research has substantiated the notion that green leadership incites green behavior among employees (Khan, 2022). It is also believed that their direction in creativity and innovation shall be guided inwardly towards the environment, and this shall pave the way for sustainable performance. The theory of innovation dates back to 1943, however, with the passage of time, its importance has become evident (Schumpeter, 2017). Performance and growth largely rely on innovation, whether it is product innovation or process innovation. Embedded in the theory of innovation is the concept called creative destruction, which proposes that to recreate the economy, stakeholders may put creative destruction into action (Arici & Uysal, 2022). Ever since the world has been alarmed about the anti-environmental practices in all spheres of life, particularly in organizational structure, they are campaigning to remain proenvironment in decision-making. This largely requires innovation that may not only surface novel technology, services, and practices in conformity with the environment, but may also mitigate, if not wipe out previously administered procedures. 2. Literature Review, Conceptual Framework and Hypotheses Development Performance has been the pivotal point of research in management studies, as the treatment variables are tried and tested in the pursuit of a surge in performance (Wholey, 1999). Leadership is one of the major treatment variables. Numerous studies have extensively examined and validated certain leadership styles that have shown to have a beneficial impact on the performance of organizations. (D'Innocenzo et al., 2016; Legood et al., 2021). Leadership, along with many of its facets, has remained effective in harnessing sustainability in organizations (Iqbal et al., 2020). The inclusion approach provides a productive path to reaching sustainable performance, as the leaders provide the required space and availability to the followers according to their diverse identities, which ensures greater performance (Nguyen et al., 2019). In addition, it is not just the ordinary performance; it is also empirically proven that inclusive leadership brings better outcomes for the environment as well. However, the argument of this study is that green inclusive leadership orchestrates a platform where employees feel comfortable and free to share their ideas and creativity to attain decarbonization in the product and process of the organization, and therefore they attain sustainability in their performance. Inclusion here means the Green Inclusive Leadership - Innovative Behavior - Sustainable Performance 682 inclusion of ideas without any prejudice, discrimination, or fear in the workplace environment. Green, inclusive leadership has shown positive results in harnessing green behavior among employees (Aboramadan et al., 2022). Therefore, we hypothesize that. ➢ H1: There is an impact of inclusive green leadership on sustainable performance. Leadership impacts employees' drive towards creativity in their performance in multiple ways (Reiter-Palmon & Illies, 2004), however, it is pertinent to notice that all mainstream facets of leadership define the significant variation in creativity and innovation of the followers, which means leadership is indispensable for organizational innovation goals (Lee et al., 2020). Innovation in the organization is a conclusive concept, that supersedes the innovative behavior of the employees, and research shows that leadership styles develop the innovative behavior in the employees (Khan et al., 2020). Inclusive leadership, in particular, impacts innovative work behavior (Javed et al., 2019), as leadership inclusion orientation makes free and relaxed minds in organizations and this helps them think innovatively which converts into innovative behavior. Green inclusive leadership, in the same line, results in green creativity in the employees (Bhutto et al., 2021), therefore, it is fair to assume that green inclusive leadership also results in innovative work behavior. The second part of this path is the relationship between innovative behavior and sustainable performance. Traditionally, it has been accepted that there is always a strong relationship between innovation and performance, similarly, the research suggests that innovative work behavior also impacts sustainable performance (Kuzma et al., 2020). The argument here is that sustainability is inextricably linked with novelty in the existing practices, and novelty can only emerge with innovation therefore, innovation is one of the pre-requisites of sustainable performance. With these arguments having strong roots in literature, we hypothesize that: ➢ H2: There is a mediating role of innovative behavior between green leadership and sustainable performance. The climate of organizations has an impact on numerous decisions and their implications (Boudrias et al., 2010; Quratulain et al., 2021; Smith-Crowe et al., 2003). Organizational climate is the set of conditions of the workplace, tangible or intangible that motivate or impede the performance of employees. Psychological climate, however, is the perception of the employee regarding the climate of the organization. Organizations strive to create favorable and conducive work environments, policies, and workplace settings according to their employees; however, it largely depends on employees' perceptions of climate. Psychological climate impacts, directly or as a moderator, many organizational outcomes, such as performance (Uraon & Gupta, 2020), work engagement and organizational citizenship behavior (Kataria et al., 2019), job satisfaction and altruistic behaviors (Álvarez-Pérez et al., 2020), and job attitudes and turnover intentions (Hartmann & Rutherford, 2015). The green psychological climate is the combined perception of employees regarding the intentions and capacity of the organization to implement and adhere to pro-environment policies and green standards (Dumont et al., 2017). Employees Samo, Ahmed & Rizvi 683 feel comfortable and confident in sharing their ideas and getting passionate about green practices and pro-environment initiatives when they experience and feel a green psychological climate. The role of green psychological climate is evident in research, it mediates the relationship between green human resource management and employee green behavior (Sabokro et al., 2021); it also mediates the relationship between greenwashing and green employee behavior (Tahir et al., 2020), it mediates the relation of green inclusive leadership and green creativity and green work engagement (Bhutto et al., 2021), it mediates the relation of green transformational leadership and green product development performance (Zhou et al., 2018). Green psychological climate has been tested positively as a moderator in some of the studies, it moderates the relationship between ethical leadership and organizational citizenship behavior (Khan et al., 2019), it moderates the relationship between green behavioral intentions and green employee green behavior (Norton et al., 2017). Inclusion climate, similarly, refers to the perception of employees about how much they think and feel that the organization is accepting and accommodating the uniqueness and singularity of people and groups (Nishii, 2013). Inclusion climate has also been used as a moderator in literature, as it moderates diversity and workplace well-being and trust climate (Downey et al., 2015), it moderates the relationship between resilience and work adjustment and turnover intentions (Davies et al., 2019), and it moderates the relation of inclusive leadership and employees' innovative behavior (Zhong et al., 2022). The social learning theory and social exchange theory guide the discussion of inclusivity on the basis of auto inclination and tendencies of employees and leaders that are generated from the environment and exchanges that happen in the organization. In the realm of these theories, climate for inclusion plays the role catalyst (Zhong et al., 2022).In the research of diversity and inclusion, the climate for inclusion has been frequently used as a moderating effect, such as in the relation between female leadership and managerial performance (Bodla & Bark, 2023), on supervisor-subordinate dissimilarity outcomes (Dwertmann & Boehm, 2014) ,particularly in the research on inclusive leadership (Alghofeli et al., 2024) . Leaders play an influencing role in certain directions, in the case of green inclusive leadership, the leaders influence the employees towards green behaviors and sustainable performance through inclusive approaches, and that role is augmented if the environment is inclusive. Therefore, we hypothesize that: ➢ H3: There is a moderating role of green psychological climate on the relation of green inclusive leadership and sustainable performance. ➢ H4: There is a moderating role of inclusion climate on the relationship between green inclusive leadership and sustainable performance. Based on the arguments and hypotheses given above, the conceptual framework of this study is presented in Figure 1: Green Inclusive Leadership - Innovative Behavior - Sustainable Performance 690 sustainable performance metrics. Table 5 (below) represents the results of the structural model but with a direct effect only. Table 5: Results of Structural Model: Direct Effect Path Path Coefficient t-Value P-Value Inference H1: GIL → SP 0.296 6.156 0.000 Supported The results of the hypothesis that included the indirect effect of green inclusive leadership on sustainable performance through innovative behavior are shown in Table 6. The results considerably support the hypothesis. The beta value of 0.326 indicates that, through the path of innovative behavior, one unit of green inclusive leadership shall bring a change of 0.326 in sustainable performance. The t-values and p-values also indicate the strong significance of the hypothesis. These findings highlight the importance of fostering green inclusive leadership practices not only for their direct effects on organizational sustainability but also for their ability to stimulate innovative behaviors that contribute to sustainable performance outcomes. Table 6 (below) represents the results of the mediating path. Table 6: Results of Specific Mediating Effect Path Path Coefficient t-Value P-Value Inference H3: GIL → IB → SP 0.325 8.638 0.000 Supported The conceptual model involved two moderating effects, which are shown in Table 7. The results of t-values, 2.329 and P-value 0.020 show that the climate for inclusion significantly moderates the relationship between green inclusive leadership and sustainable performance, however, the beta value of 0.074 predicts just a minute effect of this moderation. In addition, table 7 shows that the green psychological climate in an organization relevantly moderates the relationship between green inclusive leadership and sustainable performance more. The t-value of 5.092 and p-value of 0.000 make it more significant and the beta value of 0.145 also shows a considerable moderating effect. These outcomes underscore the nuanced interplay between contextual organizational climates and leadership practices in shaping sustainable performance outcomes, offering valuable insights into the differential impacts of various moderating factors within the examined conceptual framework. The results indicate the direct impact of green inclusive leadership on sustainability performance is significant without mediation, and when tested with mediating role of innovative behavior, the path is stronger. This result suggests that there is partial mediation of innovative behavior. Samo, Ahmed & Rizvi 691 Table 7: Results of Moderating Effects Path Path Coefficient t-Value P-Value Inference H4: CFI in → GIL → SP 0.074 2.329 0.020 Supported H5: GPC in → GIL → SP 0.145 5.092 0.000 Supported The positive impact of green inclusive leadership on the sustainability performance of the employees, particularly through innovative behavior is consistent with the previous research that derives the model from the social exchange and social learning theories (Zhong et al., 2022). The results contribute to the research by testing innovation as a mediating path to reach sustainable performance. Social learning theory posits a model where inclusive leadership at the level of CEOs and the managerial level results in the wellbeing of employees, specifically in the presence of an inclusive climate (Cao et al., 2023). The results of this study further the argument that deriving from the interplay of social learning and social exchange theory, green inclusive leadership impacts the sustainability performance of the employees through innovative behavior, in which inclusive climate significantly moderates this relationship. Moreover, the research also shows that social learning theory surfaces the model where inclusive leadership creates helping behavior among the employees, through their psychological nurturing, with psychological factors like psychological safety and psychological engagement, particularly in the health sector of Pakistan (Qasim et al., 2022). The results of this study are in a similar context and deriving from the same theory and argument, the model shows that green psychological climate moderates the relationship between green inclusive leadership and sustainability performance. 5.Discussion This research strives to contribute to the green inclusion dimension of leadership and its nexus with innovation and sustainable performance. The authors tested, directed, and mediated paths of green inclusive leadership towards sustainable performance and the role of climate catalysts. Underpinning the concept in the social exchange, social identity, and social learning theories, we framed a theoretical model that explained the mediating role of innovative work behavior and the moderating roles of psychological and inclusive climates. Data supported the hypothesized paths, and it was identified that green inclusive leadership impacts sustainable leadership and that innovative work behavior has a partial mediating role. Leaders need to pay attention to the innovative work behavior of employees once they start displaying green inclusiveness, and this process will generate sustainable performance. These findings augment the notion that leadership generally impacts performance (Ibrahim & Daniel, 2019; Ojokuku et al., 2013), and like many other Green Inclusive Leadership - Innovative Behavior - Sustainable Performance 692 leadership styles, green inclusive leadership causes a significant surge in sustainable performance, however, for that significant surge, innovative behavior is the key (Javed et al., 2021; Nguyen et al., 2019). This substantiates the previous research where innovative work behavior has been used as a mediating path between leadership and performance (Rasheed et al., 2024). Moreover, green inclusive leadership fosters sustainability in hard industries like iron ore (Hu et al., 2024) and chemicals (Quan et al., 2022), and in the pursuit of environmental behavior, leadership has also been tested as a mediating path in literature (Bhat et al., 2024). Furthermore, we also identified that a green psychological climate further clears the path of green inclusive leaders to harness innovative work behavior and sustainable performance (Patwary et al., 2023). The same role is also played by an inclusive climate; however, a more pertinent catalyst was revealed to be the green psychological climate. Climate, whether green psychological or inclusion, exacerbates the relationship between green inclusive leadership and sustainable performance. Literature supports the moderating role of psychological climate, green climate, and inclusion climate concerning leadership and performance and this finding reinforces that line of research (Norton et al., 2017; Sabokro et al., 2021; Shah et al., 2021). The research conducted in this study has proved that green inclusive leadership is the key driver for cultivating innovation and sustainable performance in the organization. The model, which is based on social exchange, social identity, and social learning theories explains how green inclusive leadership develops sustainable performance through the path of mechanism and methods. The confirmation of the empirical analysis establishes a direct lead of green inclusive leadership on sustainable performance. The comparative role of innovative work behavior now is revealed as a partial mediating one. The above means that the guidance of managers in terms of promoting and nurturing innovative work behavior among employees becomes critical, especially if it is good for the green movement. Therefore, it is safe to say that the study sheds light on the very fact that in a place, where the green psychological atmosphere prevails, innovation-friendly leaders will undoubtedly be able to achieve better generation of creative work behavior and therefore viable performance. Even though the inclusiveness of climate matters too, the intensity of the psychic process of greening depends also significantly on the green climate which is a changing phenomenon. In doing so, they not only deepen the knowledge about how leadership styles affect organizational performance but also emphasize the role of factors and climate in facilitating the accomplishment of the role. In summary, this study aligns with the previous work and presents further views on how climate could be a facilitating factor and intensifier of the relationship between leadership and performance. Meaning that it is critical information for organizational leaders who are seeking to promote sustainability and innovation among their teams. Samo, Ahmed & Rizvi 693 5.1 Conclusion This research aims to provide a comprehensive perspective on the role of green inclusive leadership in promoting sustainability performance, particularly in the healthcare sector. By considering the mediating role of innovative behavior and the moderating role of green psychological environment, and climate for inclusion, this research explains the multifaceted subtleties that drive sustainable outcomes. The results affirm that green inclusive leadership has the potential to influence sustainability performance as well as facilitate the promotion of innovative behavior of the employees in a subtle manner. It also shows the even brighter positive moderation of climate for the green psychological environment and climate for inclusion that stresses that creating favorable organizational context is more appropriate to enhance these values This study has explained the impact of green inclusive leadership in sustainable performance from the lens of social exchange, social identity, and social learning theories, therefore it has theoretical implications for these theories. SET, SIT, and SLT provide the framework for green inclusive leadership to augment sustainability in the organization. The application of social exchange theory in leadership can facilitate the development of a mutually beneficial relationship between leaders and employees. This is achieved by prioritizing sustainable performance through the implementation of innovative strategies that promote improved performance and environmentally friendly behaviors. Ultimately, this approach leads to long-term advantages for both the organization and the environment. In addition, social identity theory will be advantageous for green inclusive leadership as it may influence the formation of organizational identity centered on sustainability, therefore fostering collaborative action and shared accountability for achieving sustainable results. The use of social learning theory may demonstrate how green inclusive leadership functions as a paradigm for sustainable behaviors and serves as an example for employers. Generally, these ideas elucidate the processes by which sustainable performance may be attained in organizations. Moreover, the findings of this study complement the research in the literature in several ways. First, the mediating role of innovative behavior, in between leadership and sustainable performance is reinforced. Second, the moderating roles of green psychological climate and inclusion climate have also been strengthened, in fact, more particularly concerning green inclusive leadership. In addition, the study contributes to giving the theoretical model from the perspective of SET, SIT, and SLT, and sustainable performance has been explained with green inclusive leadership. 5.2 Practical and Managerial Implications The study has several implications for practice. First, it suggests that those organizations that intend to gain sustainable performance should harness green leadership at all levels, as it will also help them bring innovation in the behavior of their employees since innovative Green Inclusive Leadership - Innovative Behavior - Sustainable Performance 694 work behavior is generally considered a pivotal part of any kind of performance and growth. Therefore, organizations may arrange training programs for developing green inclusive leadership in their managers. Second, the climate of the organization is extremely important, if the organizations only focus on leaders' training and do not work on promoting a climate to support inclusion, whether green psychological inclusion or general inclusion climate, the results may not be that promising. Third, the results are also relevant for policymakers of countries like Pakistan, where the health industry is in dire need of innovation and sustainable performance to gain a competitive edge, the government officials may carry out complete programs of green inclusive leadership in health industries to help the industry in being more innovative and more sustainable. 5.3 Limitations Despite theoretical strength and methodological rigor, the study has some limitations that may be important for future researchers. Future research may include which involves possible mediating factors such as organizational commitment, employee engagement, or corporate social responsibility. Furthermore, future investigations may use a multilevel structural equation modelling to get a more comprehensive understanding of the link. Other potential outcomes that may be examined alongside the model used in this research include employer branding, psychological well-being, and self-empathy. Further insights may be obtained by using theories such as the resource-based approach or institutional theory. Analogous investigations might be carried out in the industrial or energy industry to assess the resilience and usefulness of the suggested model. Furthermore, a combined techniques approach might be used to get a more profound understanding of the connection. Furthermore, one may also investigate the function of gender as an inclusive criterion. Research Funding The authors received no research grant or funds for this research study. REFERENCES Aboramadan, M., Crawford, J., Turkmenoglu, M. A., & Farao, C. (2022). 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