Green HRM, transformational leadership, and psychological safety as drivers of perceived labour productivity in Indonesian manufacturing

Abstract

In the global sustainability transition, organizations face pressure to raise workforce productivity while advancing social and environmental goals. Drawing on the job demands–resources (JD-R) model and social exchange theory (SET), this study examines how green human resource management (GHRM) and transformational leadership (TL) relate to perceived labour productivity in Indonesia’s manufacturing sector, with psychological safety (PS) conceptualized as a human capital–related intangible mediating mechanism. A cross-sectional survey of 300 employees and middle managers from sustainability-oriented manufacturing firms was analysed using PLS-SEM. Results show that TL is strongly associated with PS, and PS is positively associated with perceived labour productivity (LP), yielding a significant indirect TL → PS → productivity effect, while the direct TL → productivity path is not significant. GHRM displays a modest positive direct association with perceived labour productivity but no significant association with PS, indicating a structural–relational gap whereby formal green HR systems may require leadership enactment to translate into psychologically safe climates. The study clarifies the role of PS as a key social-sustainability pathway and offers implications aligned with Sustainable Development Goal 8 in emerging-economy manufacturing contexts.