Effective organizational leadership is one of the pivots to the success of an organization, both financially and non-financially. There is a scarcity of research demonstrating the role of corporate leadership in the non-financial performance of a firm. However, a study by Saeidi et al. (2021) established a correlation between an organization’s non-financial performance through corporate responsibility and the effective leadership of the organization. According to Saeidi et al. (2021), corporate social responsibility is a mediator between Organizational leadership and firm performance.
The growing concerns about climate change have made customers more conscious of the products in the market, with most consumers preferring environmental-friendly goods. As a result, companies are increasingly engaging in corporate social responsibility by initiating strategies meant to mitigate the effects of climate change. These strategies intend to improve the organization’s image and attract customer loyalty. According to Saeidi et al. (2021), when a firm wins customer loyalty through corporate responsibility, it is likely to gain a competitive advantage and perform well financially by increasing its sales. However, for corporate social strategies to succeed, there is a need for effective organizational leadership.
Socially-oriented leaders tend to successfully appeal to the psychology of the consumers and gain their trust and confidence in addressing the social issue in question. In this case, the organization will perform well financially and non-financially through effective leadership and successful corporate strategies rather than through marketing and promotion (Saeidi et al., 2021). Therefore, according to this research, there is a direct correlation between an organization’s financial and non-financial performance and organizational leadership through effective corporate social strategies.
Reference
Saeidi, P., Robles, L. A. A., Saeidi, S. P., & Zamora, M. I. V. (2021). How does organizational leadership contribute to the firm performance through social responsibility strategies?Heliyon, 7(7), e07672. Web.