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Owing to global warming and changing environmental factors, the world has been experiencing negative and major changes. Society is showing a strong reaction to these environmental problems through marches, protests, and political initiatives, which also demonstrate the need for a new understanding of leadership. In this respect, green transformational leadership emerges as a potential solution. The current study aims to determine the mediating role of green innovation and environmental performance in the effect of green transformational leadership on sustainable competitive advantage. With this aim, a model was formed by utilizing the Natural Resource-Based View (NRBV) theory. To test the model, data were collected through a survey answered by 412 people working in SMEs in Istanbul and analyzed via the Smart-PLS program. The results indicate that green innovation had a moderate mediating role, and environmental performance had a low mediating role in the effect of green transformational leadership on sustainable competitive advantage. In light of these results, the sustainable competitive advantage predicted by the NRBV theory was found to have been achieved.
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