Female-Associated Leadership Practices and Firm Performance in Ecuadorian SMEs: The Mediating Role of Governance and Strategic Orientation

Abstract

This study examines how Female-Associated Leadership Practices (FALPs) are associated with firm performance in Ecuadorian small and medium-sized enterprises (SMEs) through organizational governance and strategic orientation. Drawing on Upper Echelons Theory, social role theory, expectation states theory, and gender and leadership research, FALPs are conceptualized as perceived leadership practices frequently linked to participative decision-making, collaboration, ethical consideration, innovation stimulation, and long-term orientation. This conceptualization avoids treating leader gender, gender diversity, women’s representation in management, and leadership style as interchangeable constructs. Using a quantitative cross-sectional design, firm-level data from 300 SMEs were analyzed through Partial Least Squares Structural Equation Modeling (PLS-SEM). The results show that FALPs are not directly associated with firm performance. Instead, they are positively associated with governance quality and strategic orientation, both of which are, in turn, positively associated with firm performance. Strategic orientation represents the strongest indirect pathway, while governance is associated with performance both directly and indirectly through strategic orientation. These findings provide a process-based explanation for inconsistent evidence on gender-related leadership practices and firm outcomes. Practically, the study suggests that participative, ethical, collaborative, innovation-oriented, and long-term leadership practices may support SMEs by strengthening governance quality and strategic capabilities.