The Power of Leadership : Leaders' Behaviours within the Innovation Process as a Contribution Towards Creating Sustainable Businesses

Abstract: Background: Companies are assuming a vital role in shaping the future for the coming generations through the development of sustainable innovations. Previous studies have stressed the importance of leadership as fundamental in the innovation process and when creating more sustainable businesses. Leaders behaving responsibly are assumed to have a positive impact on the outcome of the innovation process, as the employees are likely to apply the same behaviour. Even so, exactly how leaders behave to combine innovation and sustainability has not yet been theorised, hence, the integration of leadership, sustainability, and innovation is inadequate in the realm of literature. Purpose: The purpose of this study is to explore how leaders behave when fostering an innovation process that leads to sustainable products, services, and/or technologies. Method: The research uses a qualitative method with an inductive approach conducted through semi- structured interviews at three Swedish business-to-business (B2B) multinational enterprises (MNEs) with three leaders working with sustainability, three innovation managers, and one environment manager. Conclusion: The findings suggest three important behavioural dimensions of leaders when promoting an innovation process that leads to sustainable outcomes. In the analysis section, these dimensions are synchronised into a framework; the first one, Reinforcing Positive Psychological State, influences both Making Future-Oriented Strategic Decisions and Modelling the Opportunities and Importance, while the two latter are interrelated. By applying the behaviours illustrated in the framework, leaders behave in a way that fosters the innovation of sustainable outcomes.