Sustainable HR Practices, Leadership, and Organizational Sustainability: An Employee Perspective.

Abstract

Banking institutions are under pressure to transform HR practices into quantifiable sustainability results. This paper hypothesizes whether leadership moderates the conversion in Indian consumer banking. Structural equation modelling based on covariance was used to analyse a cross-sectional survey of 400 banking associates. The organisational sustainability was directly predicted by HR practices ( =.208, p <.001). A direct impact was more pronounced in leadership ( = .337, p <.001). The HR practices and leadership were also significantly correlated (r =.506, p <.001), which supports the idea that they are both related yet different organisational resources. The moderation effect proposed was not supported (β = -.087, p =.056). At this sample size, leadership does not have a statistically significant effect on the HR-practices-to-sustainability relationship. These results confirm the Resource-Based View and Transformational Leadership Theory as independent predictors of sustainability, but not the use of leadership as a conditional predictor of HR effectiveness. Banks aiming to achieve sustainability must invest in HR practices and leadership development as complementary, parallel levers, but not as mutually reliant.