ABSTRACT This study investigates how female leadership influences environmental sustainability practices, organizational ambidexterity, and decent work within small and medium‐sized enterprises (SMEs) in the European Union. Drawing on the resource‐based view, dynamic capabilities, and stakeholder theory, the study explores both the direct and indirect pathways through which female leadership fosters sustainability‐oriented organizational conditions. Using microdata from 7560 SMEs across 16 EU countries, collected through the 2019 World Bank Enterprise Survey, the analysis applies partial least squares structural equation modeling (PLS‐SEM) to test the relationships among key constructs. The results demonstrate that female leadership positively affects environmental sustainability outcomes, both directly and through its impact on ambidextrous capabilities and decent work practices. These findings highlight the strategic role of gender‐diverse leadership in enabling SMEs to align internal resources with sustainability objectives. The study extends current literature by integrating established constructs into a unified empirical model and offers practical insights for policymakers and managers seeking to embed sustainability into core SME strategies.
Veiga et al. (Thu,) studied this question.