Leadership as an enabler of organizational transformation in the digital and sustainable era

Digitalization and sustainability are increasingly intertwined drivers of organizational transformation, yet prior research has often examined them as separate outcomes of leadership. This study develops and tests an integrated dual-path framework in which leadership is associated with organizational transformation both directly and indirectly through digital transformation and sustainability practices. Survey data from 420 employees and managers were analyzed using an observed-variable path approach based on a system of regression equations. The findings show positive associations between leadership and digital transformation (β = 0.58, p < 0.001), leadership and sustainability practices (β = 0.51, p < 0.001), and each of the three predictors and organizational transformation. Digital transformation has the strongest direct association with organizational transformation (β = 0.36), followed by leadership (β = 0.32) and sustainability practices (β = 0.21). Product-of-coefficients tests further indicate significant indirect paths through digital transformation and sustainability practices. The study contributes by conceptualizing leadership as an orchestration capability that mobilizes two complementary transformation mechanisms rather than as an isolated direct cause of change. The results also provide managers with a structured roadmap for combining digital capability building, sustainability governance, and leadership development. Because the design is cross-sectional and uses non-probability sampling, the findings are interpreted as associations rather than causal effects.