Purpose This study investigates how digital sustainability leadership drives new revenue models in emerging market small medium-sized enterprises (SMEs), examining the mediating role of digital knowledge exploitation and moderating effects of radical green innovation. Design/methodology/approach Employing a sequential mixed-methods approach with qualitative interviews for theory development, followed by a multi-stage time-lagged quantitative study with data from 245 SMEs analyzed through Partial Least Squares Structural Equation Modeling (PLS-SEM), PROCESS macro and fuzzy-set qualitative comparative analysis (fsQCA) methodologies. Findings This study finds that digital sustainability leadership positively affects new revenue models both directly and through digital knowledge exploitation as a critical mediating mechanism. Radical green innovation serves as a significant moderator, positively moderating the digital knowledge exploitation pathway. Practical implications The study provides managers with strategic guidance for developing complementary digital and sustainability capabilities to achieve innovative revenue positioning in environmentally conscious business landscapes, highlighting the nuanced role of green innovation in shaping digital transformation pathways for emerging market SMEs. Originality/value These findings extend theory by elucidating how sustainability-focused leadership maximizes digital capabilities for revenue innovation in resource-constrained environments and identifying specific mediation mechanisms through which sustainability initiatives translate into business model innovation.
Nguyen et al. (2026) studied this question.