Purpose Focused on Indonesia’s manufacturing sector, where SMEs dominate and environmental regulations evolve. This study examines how ambidextrous leadership drives sustainability performance through green innovation, addressing a critical gap in emerging economies. By integrating the Natural Resource-Based View, we reveal how leaders’ dual exploration-exploitation capabilities foster green product and process innovation, transforming environmental challenges into competitive advantages. Design/methodology/approach Using a robust quantitative analysis of 392 Indonesian manufacturing leaders, we demonstrate that ambidextrous leadership not only directly enhances sustainability performance (ß = 0.43, p 0.001) but also indirectly through green product innovation (ß = 0.26, p 0.001). Notably, green product innovation outperforms process innovation in this context, likely due to Indonesia’s growing consumer demand for eco-friendly goods. Findings These findings offer actionable insights for policymakers and business leaders, showing that targeted leadership training and green R&D incentives can accelerate progress toward Indonesia’s 2060 net-zero agenda. This study advances leadership theory by contextualizing ambidexterity in resource-constrained settings and redefining sustainability pathways for developing nations. Originality/value This study breaks new ground by integrating the Natural Resource-Based View with ambidextrous leadership theory, revealing how leaders in Indonesia’s manufacturing sector leverage green innovation to achieve sustainability. Unlike prior research focused on Western contexts, we uncover the critical mediating roles of green product and process innovation in an emerging economy, where SME dynamics and regulatory pressures shape outcomes. The findings offer a novel framework for policymakers, linking leadership training to Indonesia’s 2060 net-zero targets. This research redefines sustainability leadership in resource-constrained settings, providing actionable strategies for balancing exploration and exploitation in green transitions.
Sakina et al. (2025) studied this question.