Transformational leadership, organisational culture and sustainability in the property development companies in Malaysia

Abstract

Sustainability is considered a significant element for property development. However, implementing sustainability effort and achieving sustainability goals are real challenge debated since three decades ago. According to the United Nations General Assembly Brundtland Report, protecting the environment and the society in the midst of human seeking economic growth is at times taken for granted. The motivation behind this study is to seek deeper understanding of the role of transformational leadership in promoting sustainability among property development companies in Malaysia. The study aims to determine the relationship between transformational leadership and sustainability among the top management at the listed property development companies, through the mediating role of organisational culture that would lead to sustainability in terms of environmental, economy and social. The study employed a purposive sampling method with data collected from top management from total population of 100 listed property development companies in Bursa Malaysia. Multivariate data normality tests, descriptive statistics, and structural equation modelling through SmartPLS were used for data analysis. Construct validity and reliability tests were performed to ensure the usability of the constructs studied. The findings of this study revealed a positive and significant relationship between transformational leadership and sustainability. Also, the study found significant positive relationship between transformational leadership and organisational culture namely bureaucratic culture, innovative culture and supportive culture. However, the results established insignificant relationship between organisational culture and sustainability. Also, the findings confirmed that bureaucratic organisational culture mediated the relationship between transformational leadership and sustainability, while innovative culture and supportive culture did not. The results confirmed that the listed property development company practicing leadership transformation at top management level will promote sustainability with the mediating role of bureaucratic culture. This study has contributed to the literature by presenting new empirical evidence not only in organisational studies on the role of transformational leadership in promoting sustainability, but also empirical evidence on the mediating role of bureaucratic culture that is evident in the property development companies Malaysia listed in Bursa Malaysia that declared their sustainability efforts in their Annual Report in 2016. The findings of the study have several theoretical, practical, and managerial implications in the fields of leadership, organisational culture and sustainability. Therefore, this study recommended organisations to invest in transformational leadership trainings to support the leadership behaviours through bureaucratic culture towards achieving sustainability.