Sustainability and Economic Performance: Role of Organizational Learning and Innovation

Abstract

The purpose of the current study is to examine the mediating role of organizational learning on a firm’s capabilities, corporate governance, leadership styles, and the firm’s sustainability. Moreover, the innovative culture used as a moderating variable between organizational learning and the firm’s sustainability. Data were collected from manufacturing organizations operating in Malaysia. This study used simple random sampling technique in data collection. Cross-sectional design and correlational design were used in meeting the objectives of the research. There were 550 questionnaires distributed among respondents,and only 382 questionnaires were returned back, 15 questionnaires were excluded from the 382 questionnaires because of misleading and missing values. Hence, in the final analysis, only 367 questionnaires were used. Findings reveal that organizational capabilities and corporate governance significantly enhance both organizational learning and a firm’s sustainability. Moreover, leadership styles significantly enhance organizational learning but have no influence on a firm’s sustainability. Organizational learning significantly mediates between organizational capabilities, corporate governance, leadership styles, and the firm’s sustainability. Organizational learning also has a significant influence on the firm’s sustainability. Finally, innovative culture significantly moderates between organizational learning and the firm’s sustainability. The practical contribution of this research is that the top management can focus on these indicators in measuring firm’s sustainability.