Family businesses are a key pillar of the Indonesian economy (Efferin & Hartono, 2015; Lukito et al., 2025). As a developing country characterised by a community and kinship-based economy, Indonesia considers family-owned businesses the main force of its national economy. Despite this significance, the long-term survival of family businesses remains uncertain. Empirical evidence consistently shows that only around 30% survive to the second generation, and only 15% reach the third generation (Efferin & Hartono, 2015; Pratono & Han, 2022). This situation underscores the need for a deeper understanding of the factors that determine the success and sustainability of family businesses in Indonesia (González-Cruz & Roig-Tierno, 2022; Lukito et al., 2025).

Among the many factors influencing family business sustainability, leadership is a key determinant of employee performance and organisational success (Goyal et al., 2023; Kaban, 2024; Ramirez-Lozano et al., 2023). However, leadership in family businesses cannot be separated from the cultural context and underlying family norms. Thoha and Chrysilla (2026), in their study of cultural influences on leadership styles and employee performance, demonstrated that cultural context significantly shapes how leaders behave and affects organisational outcomes. These findings further strengthen the argument that leadership studies in Indonesian family businesses must seriously consider local cultural dimensions.

One of Indonesia’s rich cultural heritages with a distinctive leadership tradition that has been proven to influence business dynamics is the Minangkabau culture of West Sumatra, Indonesia. In this region, leadership in family businesses is based on customary law, Islamic principles, matrilineal traditions and collectivist values (Jamilah et al., 2024). Empirically, traditional leadership styles, particularly Minangkabau Universal Leadership, rooted in cultural and religious values, have been shown to influence business performance positively. It provides important evidence that local value-based leadership is relevant in the modern business context (Andriani et al., 2024).

In family businesses, leadership reflects cultural and familial norms that can significantly impact employee behaviour and organisational outcomes (Kaban, 2024; Thoha & Chrysilla, 2026). The success of family businesses is determined by the combination of formal structures and interpersonal relationships grounded in cultural values (Hasan et al., 2020). Leadership rooted in local cultural values can be a source of competitive advantage that is difficult to replicate and a foundation for intergenerational value transfer. Understanding the mechanisms by which traditional Minangkabau leadership drives performance can provide valuable strategic insights for the sustainability of family businesses. The next theoretical gap concerns the behavioural mechanisms, such as organisational citizenship behaviour (OCB), by which leadership influences firm performance.

The role of OCB in family businesses is highly strategic. Vizcaino et al. (2021) found that in the family business context, personal service and brand equity are significantly influenced by the quality of interpersonal relationships, which are essentially manifestations of OCB behaviour. Furthermore, leadership style significantly influences the work attitudes and behaviours of non-family employees, including their propensity to exhibit OCB (Bernhard & O’Driscoll, 2011). Previous research has found that transformational leadership significantly influences OCB and organisational task performance in culturally diverse small and medium enterprises (SMEs) in Indonesia, where it increases OCB, which in turn drives improved performance (Islam et al., 2024; Rino et al., 2023).

This study develops a structural equation model to examine how five constructs interrelate: Minangkabau Universal Leadership (encompassing local, religious and learning values), OCB and family business performance. A 5-point Likert scale (ranging from 1 = strongly disagree to 5 = strongly agree) was used to measure all constructs. The measurement instruments were drawn from existing literature: Local cultural values used a six-item measurement, religious values used a four-item measurement and learning values used a four-item measurement from the previous research by Sulastri et al. (2018), OCB was adapted from a four-item measurement developed by Organ et al. (2006), and family business performance was adapted from a four-item measurement developed by Pratono and Han (2022).

This study assessed the measurement model’s reliability and validity using the recommended two-stage partial least squares structural equation modelling (PLS-SEM) assessment (Hair et al., 2019). Respondents in this study were 240 family-owned businesses in West Sumatra, Indonesia.

Table 1 presents the complete item list alongside variance inflation factor (VIF) values and outer loadings for all indicators.

Convergent validity was established by examining the average variance extracted (AVE). All AVE values exceeded the minimum threshold of 0.50, ranging from 0.648 (family business performance) to 0.753 (OCB), indicating that each construct explained the majority of variance in its respective indicators. Figure 1 shows that convergent validity was further supported by outer loadings ranging from 0.763 to 0.886 across all constructs, all of which exceed the recommended threshold of 0.70 (Hair et al., 2019). Discriminant validity was assessed using the Heterotrait-Monotrait (HTMT) ratio of correlations (Henseler et al., 2015),which represents a more conservative and statistically superior criterion than the Fornell-Larcker criterion or cross-loadings inspection. All HTMT values were below the conservative threshold of 0.90, indicating that each construct is empirically distinct from the others in the model.

Internal consistency reliability was evaluated through two measures: Cronbach’s alpha and composite reliability (CR). All constructs surpassed the accepted minimum threshold of 0.70 for both metrics. Composite reliability scores ranged from 0.821 (family business performance) to 0.913 (local cultural value), while Cronbach’s alphas ranged from 0.818 to 0.911, demonstrating adequate internal consistency across all five constructs.

The results of the reliability assessments for all five constructs examined in this study. Internal consistency was evaluated using Cronbach’s alpha and CR, both of which exceeded the widely accepted threshold of 0.70 across all constructs, thereby confirming adequate reliability. Specifically, local cultural value yielded the highest reliability estimates, with a Cronbach’s alpha of 0.911 and a CR of 0.913, followed by OCB (α = 0.891; CR = 0.893), learning value (α = 0.879; CR = 0.879), religious value (α = 0.867; CR = 0.868) and family business performance (α = 0.818; CR = 0.821). Collectively, the measurement model results confirm that all constructs exhibit acceptable reliability, convergent validity and discriminant validity, thereby providing a sound basis for structural model evaluation.

Following confirmation of measurement model adequacy, the structural model was evaluated using established PLS-SEM procedures. Table 2 shows that path coefficients, their corresponding t-statistics and p-values were estimated using a bootstrapping procedure with 5000 resamples and bias-corrected confidence intervals, consistent with contemporary best practice for inferential testing in variance-based structural equation modelling (SEM) (Streukens & Leroi-Werelds, 2016). Collectively, the diagnostics confirm that the model is statistically well specified and suitable for hypothesis testing.

The results reveal substantively heterogeneous effects of Minangkabau Universal Leadership dimensions on family business performance. Local cultural value shows a positive, statistically significant association with performance (β = 0.405, p < 0.001), providing strong support for H1a. This finding indicates that leadership grounded in culturally sanctioned governance logics contributes directly to superior firm outcomes. Learning value also demonstrates a positive and significant effect on performance (β = 0.412, p < 0.001), supporting H1c. The magnitude of this effect suggests that intergenerationally transmitted knowledge constitutes a salient strategic resource that enhances performance through leadership judgement and adaptive capability.

In contrast, religious value displays a statistically significant negative direct effect on performance (β = −0.230, p < 0.05), leading to rejection of H1b. This result indicates that, when enacted as a direct decisional logic, religious leadership may introduce normative constraints that temper performance outcomes. Importantly, this finding foreshadows the relevance of behavioural mediation.

Local cultural value is positively related to OCB (β = 0.303, p < 0.001), supporting H2a. Leadership practices grounded in communal norms and relational accountability effectively elicit discretionary employee contributions. Religious value emerges as the strongest predictor of OCB in the model (β = 0.490, p < 0.001), providing robust support for H2b. This result indicates that morally grounded leadership activates powerful reciprocal and identification-based mechanisms that translate into elevated citizenship behaviour. Learning value, however, does not exert a statistically significant effect on OCB (β = 0.160, p = 0.061). Accordingly, H2c is not supported, suggesting that learning-based leadership influences performance through channels other than socio-emotional reciprocity.

Indirect hypotheses reveal a differentiated pattern across leadership dimensions. Organisational citizenship behaviour significantly mediates the relationship between local cultural value and family business performance (β = 0.107, p < 0.01), supporting H3a. Because the direct effect remains significant, this constitutes complementary partial mediation, indicating that local cultural value enhances performance through both governance-based and behaviourally activated pathways. Organisational citizenship behaviour also significantly mediates the relationship between religious value and performance (β = 0.172, p < 0.01), supporting H3b. When evaluated alongside the negative direct effect, this pattern reflects competitive mediation. Substantively, religious leadership constrains performance when enacted directly but enhances performance indirectly by activating discretionary employee behaviour. In contrast, the indirect effect of learning value through OCB is not statistically significant (β = 0.056, p = 0.094), leading to rejection of H3c. Combined with the strong direct effect, this result indicates that learning value primarily contributes to performance through cognitive and strategic mechanisms rather than through behavioural mediation.

Overall, the results identify three distinct performance pathways associated with traditional leadership. Local cultural value operates through a dual mechanism, combining direct governance effects with behavioural mediation. Religious value follows a competitive mediation structure, in which positive indirect effects offset negative direct effects through OCB. Learning value exhibits a direct and dominant pathway that does not rely on citizenship behaviour. Of the nine hypotheses tested, six are supported (H1a, H1c, H2a, H2b, H3a and H3b), underscoring the analytical importance of disaggregating traditional leadership into its constituent dimensions and explicitly modelling behavioural mechanisms.

This study examined how multidimensional Minangkabau Universal Leadership shapes family business performance and whether OCB functions as a behavioural mechanism linking culturally embedded leadership to firm outcomes. The findings reveal a pattern of heterogeneous performance pathways that challenge monolithic assumptions about traditional values. Rather than operating as a uniform cultural resource, local cultural, religious and educational values exert fundamentally different, and at times opposing, effects on performance through distinct governance, behavioural and cognitive mechanisms.

The results show that local cultural value simultaneously enhances family business performance, both directly and indirectly through OCB, and constitutes a pattern of complementary partial mediation. The direct effect reflects the capacity of communally grounded leadership to operate as an institutionalised governance logic by anchoring decision-making in kinship obligations, consensus and socially sanctioned norms. It reduces relational friction and coordination costs that are endemic to family enterprises (Chrisman et al., 2024; Den Hartog & De Hoogh, 2024). The parallel indirect effect, channelled through OCB, indicates that these same culturally authentic practices generate reciprocal socio-emotional obligations that employees discharge through extra-role contributions. The evidence suggests that this duality is not incidental but constitutive of how traditional leadership generates value in matrilineal, collectivist commercial contexts.

The most theoretically consequential finding concerns religious value, which displays a configuration of competitive mediation in which a negative direct effect is offset by a substantial positive indirect effect operating through OCB. This pattern resolves the value-constraint paradox that has long troubled traditional and values-based leadership research (Gómez-Mejía & Herrero, 2022; Scott, 2017). When enacted as a direct decisional logic, religious leadership appears to introduce normative constraints: risk aversion, reluctance to pursue aggressive expansion, deference to moral considerations over short-term profit maximisation and the subordination of market responsiveness to ethical consistency. These constraints manifest empirically as the negative direct path to performance. The same religious values, when internalised by employees and transmitted through the motivational and relational dynamics captured by OCB, constitute a powerful generative force: they elicit cultural identification, moral validation and a sense of collective purpose that are discharged in elevated discretionary behaviour. The effect is that religious leadership enhances performance only through its behavioural microfoundations, a finding that directly challenges earlier studies that examined religious or spiritual leadership solely through direct effects and yielded inconclusive or conflicting conclusions. The competitive mediation structure reported here is not a statistical curiosity; it is a substantive theoretical revelation that the performance relevance of religious leadership is behaviourally mediated rather than directly realised. The relationship between traditional Minangkabau leadership and family business performance can be understood through several interrelated mechanisms. The strong Minangkabau entrepreneurial tradition directly contributes to business performance. Transformational leadership, which aligns with Minangkabau leadership values such as encouraging innovation and collective progress, has been shown to improve business performance through strategic decision-making (Goyal et al., 2023).

The direct-dominant pathway of learning value tells a different theoretical interpretation. Its strong positive direct effect on family business performance, combined with the absence of significant mediation through OCB, suggests that intergenerationally transmitted wisdom operates predominantly through cognitive and strategic channels rather than through socio-emotional exchange. In the Minangkabau family business context, learning value is less a source of moral obligation that activates reciprocity and more a repository of adaptive capability embedded in leadership judgement, problem-solving heuristics and organisational memory (Birdthistle & Fleming, 2005; De Massis & Kotlar, 2015; Hamilton, 2011). The learning value fails to activate OCB materially refines the idea that not all culturally embedded value dimensions operate through identical psychological routes. This differentiation challenges the undifferentiated treatment of traditional values prevalent in earlier research and underscores the analytical necessity of dimensional disaggregation.

This study examines the influence of Minangkabau Universal Leadership (consisting of local cultural values, religious values and learning values) on family business performance in West Sumatra, Indonesia, with OCB as a mediating variable. Data were processed using structural equation modelling based on partial least squares (SEM-PLS) with 240 family businesses. Local cultural values have a significant positive effect on family business performance, both directly and indirectly through OCB, reflecting complementary partial mediation. Learning values exert a dominant, significant direct effect on performance, with little mediation by OCB, indicating that these values operate through cognitive and strategic pathways. Meanwhile, religious values exhibit a unique pattern of competitive mediation, in which a positive and significant indirect effect through OCB offsets their negative direct effect on performance.

On managerial implications, the complementary mediation of local cultural value, the competitive mediation of religious value and the direct-dominant effect of learning value provide concrete guidance for family business owners on succession planning and cross-generational continuity.

These findings confirm that traditional leadership is not a monolithic cultural block but a multidimensional construct that generates organisational values through diverse mechanisms. However, this study has several limitations that should be acknowledged. The limited sample size of family businesses in West Sumatra limits generalisability to other cultural contexts. At the same time, the cross-sectional design does not allow for inference of temporal causality between variables. Performance measures based on subjective perceptions may also be subject to response bias, and this study failed to consider contextual variables, such as leadership generation and firm size, that may moderate the relationships studied. Therefore, future research should adopt a longitudinal design to capture cross-generational dynamics and conduct cross-cultural comparative studies in regions with distinct local wisdoms to test the model’s broader applicability. Exploration of moderating variables such as entrepreneurial organisation and family composition in management, as well as the use of objective performance data such as financial statements, would further strengthen the validity and theoretical contribution of this study.