The Interactive Effect of Employee-Involved Governance and CEO Change-Oriented Leadership on Organizational Innovation: A Moderated Mediation Model

Previous empirical findings on the effect of employee-involved governance (EIG) on innovation are inconsistent and even contradictory. Based on an interactionist perspective of innovation, we propose that this effect is contingent on CEO change-oriented leadership (COL) and mediated by two distinct innovative processes: exploratory and exploitative innovations. Using multisource data from 161 enterprises, we demonstrated that EIG was positively (negatively) associated with innovative performance when CEO COL was higher (lower). The results also revealed that exploratory and exploitative innovations played different roles in mediating the effects of EIG on innovative performance depending on CEO COL. Specifically, exploratory innovation mediated that effect when CEO COL was high, but exploitative innovation did not. Theoretical and practical implications are discussed.