1 Tecnologico de Monterrey, Management and Leadership Department, Mexico
Research paper. Received: 06-03-2025; accepted: 18-05-2026
Organizational politics—defined as self-interested behaviors aimed at influencing others and outcomes (Ferris et al., 2002; Miller et al., 2008)—are a persistent reality in organizational life. Such behaviors shape decision-making processes, access to resources, and interpersonal dynamics, with important implications for how employees experience and interpret their work environment. A global survey indicates that many employees, particularly younger cohorts, perceive office politics as a significant obstacle to job performance and satisfaction (HBR Ascend, 2019). These concerns tend to intensify in organizational contexts that implicitly tolerate or reward self-serving conduct (Schmid et al., 2019), making the study of political perceptions increasingly salient in management research (Teimouri et al., 2018).
To capture the subjective nature of these dynamics, scholars have focused on perceived organizational politics (POP), defined as employees’ evaluations of political behavior within the workplace (Hochwarter et al., 2020; Kaur & Kang, 2023; Zivnuska et al., 2004). POP reflects not only individual experiences but also shared organizational norms and expectations. In this sense, organizational climate (OC), understood as a collective interpretation of organizational policies, practices, and behavioral cues (Ehrhart et al., 2014), functions as a critical interpretive filter. Although employees may be exposed to similar political environments, their perceptions of the prevailing climate can differ markedly (Perrigino et al., 2021), shaping how political behavior is understood and how individuals respond to it.
These interpretive processes are particularly relevant for understanding work-role innovation (IN), defined as employees’ proactive efforts to modify, expand, or improve their job roles (Axtell et al., 2000; Shanker et al., 2017). Innovation at the work-role level rarely emerges as an automatic response to contextual stimuli; rather, it depends on how employees make sense of their environment and assess the risks and opportunities associated with change-oriented behavior. While prior research has examined organizational politics and OC as distinct antecedents of employee outcomes, limited attention has been paid to their joint shaping of innovative behavior. This gap is especially pronounced in family-owned small and medium-sized enterprises (SMEs), where governance structures, relational proximity, and informal influence processes differ substantially from those in large corporations (Hochwarter et al., 2020).
In family firms, organizational politics, climate, and innovation unfold within a broader ecosystem of family influence, values, and governance mechanisms (De Massis et al., 2021). Power dynamics in these organizations are often shaped by kinship ties, emotional attachment, and the pursuit of socioemotional wealth (Gómez-Mejía et al., 2011; 2007), resulting in political behaviors that may not be interpreted solely as opportunistic or self-serving. Instead, political actions may be perceived as attempts to safeguard family legacy, preserve relational harmony, or ensure long-term continuity through strategic renewal. In this context, innovation often emerges as a negotiated response to internal power dynamics, reflecting the family’s effort to balance tradition and change. The embeddedness of both formal and symbolic power thus plays a central role in shaping how political behavior is interpreted and how these interpretations influence employees’ willingness to engage in innovative, change-oriented activities (Capella et al., 2024; Vázquez & Tomaselli, 2025).
Building on these insights, this study examines how POP influences IN in family-owned SMEs, with particular attention to the mediating role of OC. Rather than assuming a direct, uniformly negative effect of POP, we argue that POP primarily affects innovation through the interpretive lens of the OC. While political behavior has often been associated with dysfunctional outcomes (Guo et al., 2019; Sun & Chen, 2017), emerging evidence suggests that it can also support adaptive behaviors, such as enhanced networking or strategic self-positioning, under certain contextual conditions (Bhattarai, 2022; De Clercq & Belausteguigoitia, 2017). By explicitly modeling OC as a mediating mechanism, we seek to clarify the conditions under which political perceptions inhibit or enable innovative behavior in family firms.
This study contributes to family business literature in several ways. First, it advances the understanding of the micro-level mechanisms through which internal political dynamics shape innovation outcomes in family-owned SMEs. Second, by positioning OC as the primary mediating mechanism linking POP to IN, the study moves beyond dichotomous portrayals of organizational politics as either harmful or beneficial. Integrating insights from the socioemotional wealth (SEW) perspective with the literature on political behavior, we demonstrate that in family-controlled firms, political actions may be interpreted through relational and trust-based lenses, thereby facilitating—rather than constraining—innovation. In doing so, this research contributes to ongoing scholarly debates on the dual nature of political behavior in family firms and enriches our understanding of how informal organizational dynamics influence individual-level innovation.
The remainder of the paper is structured as follows. Section 2 presents the theoretical framework and hypotheses. Section 3 describes the methodology. Section 4 reports the results. Sections 5 and 6 discuss the findings and their theoretical and practical implications.
Organizations are inherently political systems in which individuals with divergent interests, goals, and power bases interact and compete. Political behavior emerges naturally in contexts characterized by resource scarcity, interdependence, and ambiguity (Ferris & Kacmar, 1992). In family firms, these dynamics are intensified by the overlap between familial and professional roles, producing distinctive patterns of influence, authority, and power asymmetry (Ortín García et al., 2014). As Vázquez and Tomaselli (2025) argue, power in family firms is often diffuse and relational, grounded less in formal hierarchies and more in socioemotional priorities and interpersonal bonds. This perspective challenges conventional organizational frameworks by emphasizing a complex ecosystem shaped by informal influence, emotional attachment, and intergenerational negotiation. Within such environments, POP becomes a particularly salient mechanism through which family owners and dominant actors influence behavior and shape organizational outcomes.
Foundational research conceptualizes politics as an intrinsic feature of organizational decision-making. Burns (1961) framed politics as the negotiation of competing interests, while Tushman (1977) highlighted its potential creative role in mobilizing coalitions and navigating uncertainty. Building on these ideas, Ferris et al. (1989) introduced the POP model, shifting scholarly attention from objective political behavior to employees’ subjective interpretations of political activity. This shift is consistent with Lewin’s (2013) proposition that individuals respond not to objective reality but to their perceptions of it. Accordingly, subsequent research has emphasized that perceptions of politics—rather than political actions themselves—are the primary drivers of employee attitudes and behaviors (Ferris et al., 1996; Gandz & Murray, 1980; Kacmar & Ferris, 1993, 1991; Kacmar et al., 1999).
In family-owned SMEs (FOS), political behavior is embedded within relational structures shaped by non-economic priorities, including the preservation of socioemotional wealth, continuity of legacy, and family harmony (Gómez-Mejía et al., 2011). These priorities influence how political actions are enacted and interpreted, often reframing them as aligned with collective, long-term family objectives rather than as purely self-serving behaviors (Brundin et al., 2023). Familial ties, emotional ownership, and strong identification with the firm contribute to a political environment that is affectively and relationally charged (Hernández-Linares et al., 2017). As De Massis et al. (2021) note, the governance structures and socioemotional logic of family firms can transform political actions into mechanisms of coordination, legitimacy, and continuity. Supporting this view, Su et al. (2024) demonstrate that family social capital can convert POP into a positive force by fostering family-to-work enrichment, thereby facilitating individual advancement rather than undermining organizational functioning.
Understanding political dynamics in family firms, therefore, requires close attention to employees’ perceptions and evaluations of political behavior. Kacmar and Ferris (1991) define POP as employees’ perceptions of self-serving behaviors enacted to advance personal interests. In family firm contexts, however, such evaluations are often filtered through kinship ties, emotional bonds, and gendered expectations, which shape norms of reciprocity, fairness, and contribution (Madison et al., 2021). More broadly, POP is influenced by both individual characteristics and organizational context (Tripathi & Tripathi, 2022). As Vigoda (2006) observes, research on organizational politics spans macro-level perspectives—focusing on structure and culture—and micro-level approaches emphasizing individual cognition and behavioral responses to political cues (Kacmar & Ferris, 1991). This duality underscores that the consequences of POP cannot be understood in isolation from the interpretive environment in which political behavior occurs.
Despite this complexity, much of the literature has portrayed organizational politics as inherently dysfunctional. Prior reviews link POP to reduced job satisfaction (Guo et al., 2019; Hochwarter, 2003; Sun & Chen, 2017; Witt et al., 2002), heightened job stress (Poon, 2003; Vigoda, 2002), and increased counterproductive behaviors (Meisler et al., 2020), often framing politics as a source of tension and work–family conflict (Fiaz & Qureshi, 2021). However, alternative perspectives suggest a more nuanced interpretation, viewing politics as a legitimate form of influence, sensemaking, and adaptation (Kurchner-Hawkins & Miller, 2006; Landells & Albrecht, 2017). In FOS, where trust is built through long-term familiarity and shared history, political behavior may be interpreted less as a source of conflict and more as a mechanism for coordination and informal governance (Vigoda, 2002). This interpretive variability highlights the importance of context in determining whether POP constrains or enables constructive employee behavior.
Political behavior is particularly salient in organizational contexts characterized by ambiguity—such as unclear goals, unequal access to information, and subjective performance criteria. While these conditions exist across organizational forms, they are often more pronounced in family firms (Miller et al., 2013). Two dominant perspectives emerge in the literature: one conceptualizes politics as context-dependent, ranging from rational influence to self-serving manipulation (Weissenberger-Eibl & Teufel, 2011), while the other treats politics as an unavoidable feature of organizational life, portraying firms as arenas of interconnected political games (Hochwarter, 2020). In family-owned SMEs, these dynamics are further shaped by socioemotional priorities. Family owners may accept uncertainty or forgo short-term financial gains—such as endorsing innovation initiatives or resisting diversification—when such decisions align with the preservation of their socioemotional endowment (Gómez-Mejía et al., 2011; Naldi et al., 2013). Consequently, risk preferences and strategic behavior in family firms are situational and deeply embedded in relational and emotional logics. These logics, in turn, shape how political behavior is perceived, how the psychological climate is constructed, and how employees interpret the legitimacy of engaging in innovative, change-oriented activities.
2.1. Organizational politics and work-role innovation
IN refers to employees’ discretionary efforts to introduce and implement novel ideas that improve work processes, such as developing new procedures, acquiring or sharing new skills, or redefining role expectations (Axtell et al., 2000; Parker & Collins, 2010). Although such behaviors enhance organizational adaptability and competitiveness, they are inherently resource-intensive and psychologically demanding (Scott & Bruce, 1994). As a result, employees’ willingness to engage in innovation is highly sensitive to contextual cues that signal whether change-oriented behavior is supported, legitimate, and likely to succeed.
One contextual factor that shapes these cues is POP. Prior research has predominantly linked POP to adverse employee outcomes, arguing that political environments undermine trust, erode psychological safety, and discourage proactive behaviors, including innovation (Aryee et al., 2009; Chen et al., 2022). From this perspective, political behavior is seen as destabilizing, leading employees to avoid risk-taking and discretionary effort. However, this view does not fully account for organizational contexts in which political behavior is embedded in relational norms and informal governance structures. As De Massis et al. (2021) argue, innovation in FOS emerges from broader social ecosystems in which power relations, values, and shared meanings shape how political actions are enacted and interpreted.
In FOS, the relationship between POP and IN is strongly influenced by the pursuit of SEW. Decision-making in these firms is guided not only by economic rationality but also by the family’s desire to preserve legacy, maintain control, and ensure long-term continuity (Gómez-Mejía et al., 2011, 2007). Within this context, internal political actions are often interpreted through a collective, long-term lens rather than as purely self-serving behavior. Consistent with recent research suggesting that innovation in family firms is inherently political (Capella et al., 2024), the pursuit of novel initiatives frequently depends on informal influence, coalition-building, and the mobilization of family and non-family support. Employees operating in such environments recognize that navigating these political dynamics is often necessary to secure resources and legitimacy for innovation, establishing a meaningful—though not necessarily linear—relationship between POP and innovation-related behavior.
Recent perspectives further suggest that political behavior can facilitate innovation when it is perceived as strategic and aligned with organizational goals. Political actions may help employees access scarce resources, gain visibility, and build support for new ideas, particularly in organizations characterized by informal structures and interpersonal familiarity (Schweitzer et al., 2024). In FOS, where relational proximity is high and formal procedures are often underdeveloped, political behavior may be perceived less as a source of conflict and more as a coordination mechanism that enables collective action (Upadhyay et al., 2016). Under such conditions, POP may support rather than suppress IN.
This interpretive ambiguity is especially salient in emerging-market contexts, such as Mexico, where family-owned SMEs frequently face resource constraints, institutional voids, and high levels of informality (Ramírez-Solis & Rodríguez-Marín, 2022). In these settings, employees’ perceptions of internal political behavior become a critical lens through which they evaluate the feasibility and legitimacy of engaging in innovative activities. Depending on whether political behavior is interpreted as opportunistic or as aligned with collective family goals, POP may either inhibit or facilitate IN.
Taken together, prior research suggests that the relationship between POP and IN in FOS is inherently context dependent. While some studies emphasize the detrimental effects of politics on trust and psychological safety (Aryee et al., 2009; Chen et al., 2022), others highlight the role of political dynamics as mechanisms for coordination, informal influence, and resource mobilization in family firms (Capella et al., 2024; Vázquez & Tomaselli, 2025). Given this variability, and consistent with the view that political behavior in family firms is interpreted through relational and socioemotional lenses, we do not assume a unidirectional effect. Instead, we posit that POP is systematically related to IN, with the nature of this relationship contingent on employees’ interpretive context. Accordingly, we focus on the baseline association between POP and IN, without specifying a priori the direction of the effect:
H1 (non-directional). There is a significant bivariate association between the Perception of Organizational Politics (POP) and work-role innovation (IN) in family-owned SMEs (FOS).
2.2. Perceptions of organizational politics and organizational climate
The POP shape not only individual attitudes and behaviors but also employees’ collective interpretations of the OC. OC, understood as a collectively constructed system of meanings and expectations (James & James, 1989; Patterson et al., 2005), reflects shared perceptions of an organization’s policies, practices, and behavioral norms that define “how things are done” (Ehrhart et al., 2014). These shared perceptions form the psychological context in which employees operate, influencing trust, cooperation, and willingness to engage in discretionary behaviors such as innovation (Vigoda, 2002; Harris et al., 2005).
In non-family organizations, POP has typically been associated with dysfunctional climates characterized by distrust, competition, and uncertainty (Poon, 2003; Vigoda, 2002). However, this predominantly negative view does not fully capture the dynamics of FOS, where political behavior is embedded in socioemotional and relational logics. Drawing on SEW theory, family firms prioritize non-economic goals such as family control, reputation, continuity, and emotional attachment (Gómez-Mejía et al., 2011). As a result, political actions in FOS—such as efforts to maintain family influence, manage succession, or protect the family’s identity—may be interpreted not as opportunistic behavior but as legitimate mechanisms for safeguarding long-term collective interests.
The political climate in FOS is therefore intensely affective and relational, shaped by kinship ties, emotional ownership, and long-standing interpersonal relationships. Within this context, political behavior often follows relatively predictable patterns aligned with shared family values, making power structures more transparent and intelligible to organizational members. When employees perceive political actions as consistent with these values, POP can contribute positively to the OC by reducing ambiguity, clarifying influence structures, and fostering cohesion and collective purpose. Rather than eroding trust, political behavior may signal stability and continuity, reinforcing shared expectations about decision-making and authority.
Informal governance mechanisms and close relational proximity further shape OC in FOS. Emotional bonds, shared histories, and repeated interactions create interpretive lenses through which political behavior is evaluated (Eddleston & Kellermanns, 2007; Nosé et al., 2017). While non-family employees may sometimes interpret politics negatively—notably when they feel excluded from decision-making processes (Brundin et al., 2023)—political behavior that is perceived as aligned with collective goals and relational norms can enhance OC by strengthening mutual respect, fairness perceptions, and relational trust (Cropanzano et al., 2017).
Supporting this interpretation, Bozeman et al. (2001) suggest that employees who understand and navigate their organizational environments tend to perceive politics more positively. In family firms characterized by strong values, shared identity, and relational governance, political behavior may therefore become integrated into broader climates of participation, predictability, and psychological safety, where employees feel secure in expressing ideas and taking the initiative (Kopelman et al., 1990). Under such conditions, POP may reinforce rather than undermine a positive OC.
Taken together, these arguments suggest that in FOS, perceived politics can play a constructive role in shaping OC. When political behavior is interpreted as aligned with socioemotional goals and collective family values, it contributes to shared understandings that enhance cohesion, trust, and clarity. Accordingly, we propose the following hypothesis:
H2. POP positively influences OC in FOS.
2.3. Organizational climate as a mediator between perception of organizational politics and work-role innovation
The mediating role of OC in the relationship between POP and IN is particularly salient in FOS, where relational proximity, informality, and resource constraints shape employee behavior. IN requires employees to engage in proactive effort, uncertainty, and personal risk (Axtell et al., 2000; Scott & Bruce, 1994). Such behavior is unlikely to emerge solely in response to political dynamics; rather, it depends on whether the organizational environment provides psychological safety and legitimacy for experimentation. In this regard, OC constitutes a critical enabling condition that determines how political influence is translated into innovation-related action.
A positive OC, characterized by trust, support, and psychological safety, reduces employees’ fear of failure and encourages experimentation, even in politically sensitive environments (Baer & Frese, 2003; Edmondson, 2011; Kopelman et al., 1990). In family firms, political dynamics are deeply embedded in governance structures that define who holds influence and how decisions are made (De Massis et al., 2021). However, political influence alone does not determine innovative outcomes. Instead, it is the prevailing OC that determines whether influence is exercised to encourage idea generation, knowledge sharing, and role expansion, or to suppress such behaviors (Capella et al., 2024).
OC is inherently subjective yet collectively constructed (Ehrhart et al., 2014; James & James, 1989), making it particularly well-suited to capture the shared meanings that emerge in family firms. Within this context, OC operates as an interpretive filter that reframes political behavior. Through this mechanism, POP influences innovation indirectly by shaping the climate in which employees evaluate the risks and rewards of engaging in innovative activities.
Extant research supports the role of OC as a central mechanism linking contextual conditions to innovative behavior. Psychologically safe climates foster knowledge sharing, creativity, and experimentation—processes that are especially critical in SMEs with limited slack resources (Carmeli, 2007; Edmondson, 2011). Baer and Frese (2003) show that supportive climates reduce fear of failure and increase risk-taking, while Janssen (2000) demonstrates that fair and supportive climates enhance employees’ willingness to engage in proactive and change-oriented behavior. Together, these studies suggest that OC provides the proximal conditions under which innovation becomes viable.
Empirical evidence further reinforces the mediating role of OC. Li et al. (2016) demonstrate that OC mediates the relationship between psychological contract breaches and innovation outcomes, while González-Romá et al. (2009) show that climate transmits the effects of leadership practices onto performance. These findings highlight OC as a mechanism through which broader organizational dynamics influence individual behavior, rather than as an outcome.
In FOS, the mediating function of OC becomes even more pronounced due to close interpersonal ties and the absence of formalized procedures. Andersson et al. (2020) argue that innovative climates are particularly consequential in small firms, where employees operate in dense social networks and rely heavily on informal signals to guide behavior. Similarly, Röd (2016) emphasizes that in family businesses, climate plays a decisive role in shaping innovation by legitimizing or constraining employees’ willingness to challenge existing practices.
Taken together, these arguments suggest that POP do not exert a direct influence on IN in FOS. Instead, their effect is fully channeled through OC. When political behavior is perceived as legitimate and predictable, it fosters a supportive climate that enables employees to engage in innovative, change-oriented behavior. Accordingly, we propose the following hypothesis:
H3: The OC mediates the relationship between the POP and IN in FOS.
Consistent with prior mediation research in organizational and family business contexts (e.g., Sánchez-Famoso et al., 2023; Yasin, 2021), Hypothesis 1 is formulated as a non-directional baseline association intended to establish whether perceived POP and IN are empirically related before introducing an explanatory mechanism. Accordingly, the mediation analysis distinguishes between the overall association (total effect) between POP and IN and the residual direct effect estimated after accounting for OC’s mediating role. Accordingly, H1 should not be interpreted as a hypothesized residual direct effect within the mediation model. Hypothesis 2 specifies the directional influence of POP on OC, whereas Hypothesis 3 formally tests the mediating role of OC in transmitting the effects of POP to innovation. In this framework, the mediation hypothesis (H3) represents the central theoretical test of the proposed model (Figure 1).
Figure 1. Research model
Rather than examining objective indicators of organizational politics—which are inherently difficult to observe and verify—prior research has consistently emphasized POP as a meaningful predictor of employee attitudes and behaviors (Ferris et al., 2002; Miller et al., 2008). At the micro level, employee behavior emerges from interactions between individuals and their organizational context, giving rise to subjective interpretations of workplace dynamics. These interpretations shape how employees attribute meaning to environmental cues and respond behaviorally to them. Accordingly, the individual–organization interaction constitutes a critical mechanism for understanding employee responses to political dynamics (Bamel et al., 2013).
3.1. Sample and data collection
The empirical context of this study consists exclusively of family-owned small and medium-sized enterprises (SMEs) operating in Mexico. Following Astrachan et al. (2002), a firm was classified as family-owned if (1) a single family held majority ownership and (2) one or more family members were actively involved in strategic decision-making or governance. This definition is consistent with established criteria in family business research (Chua et al., 1999; De Massis et al., 2021).
Survey data were collected from 421 individual respondents across 134 family-owned SMEs. The respondents included founders, second-generation family members, and non-family managers with direct knowledge of the firm’s internal dynamics. On average, approximately 3 respondents per firm participated, allowing the study to capture multiple perspectives within each organization. This respondent profile ensured that the data reflected embedded perceptions of organizational politics, OC, and innovation-related behavior among individuals closely involved in governance and day-to-day operations.
A snowball sampling strategy was employed to recruit participating firms. The initial sampling frame comprised 117 footwear manufacturing SMEs affiliated with the Footwear Industry Chamber of Jalisco, which served as the primary point of contact. Participating firms were subsequently asked to refer other family-owned SMEs, expanding the sample through established trust networks. All firms met the Mexican government’s official SME classification criteria based on the number of employees (INEGI, 2010). Descriptive statistics are reported in the Results section.
3.2. Measurement of variables
All constructs were measured using validated multi-item scales drawn from prior literature and adapted to the family SME context. Unless otherwise noted, items were assessed using a five-point Likert scale.
POP was measured using an adapted version of the scale developed by Kacmar and Ferris (1991), encompassing three dimensions: General Political Behavior (two items; e.g., “People in this company seek their development by overriding anyone who stands in their way”), Go Along to Get Ahead (seven items; e.g., “Agreeing with the most powerful is the best alternative in this company”), and Pay and Promotion Policies (six items; e.g., “Since I have been working at this company, I have never seen favoritism in payments and promotions”). Higher values indicate stronger perceptions of self-serving political behavior.
To ensure consistent interpretation across dimensions, items in the Pay and Promotion Policies subscale—which were originally positively worded—were reverse-coded so that higher scores uniformly reflect stronger political perceptions across all POP components.
OC was assessed using a multidimensional scale developed by Brown and Leigh (1996) and adapted from Patterson et al. (2005). The scale captures employees’ shared perceptions of the work environment across six dimensions: supervisor support, role clarity, expression of feelings, personal contribution, recognition, and sense of job challenge. Consistent with prior research, these dimensions reflect interrelated affective and motivational experiences associated with psychological safety, engagement, and job satisfaction (James & James, 1989; Patterson et al., 2005).
In line with this perspective, job satisfaction and engagement are conceptualized in the present study as expressions of OC, rather than as independent constructs, capturing employees’ evaluative and motivational responses to the shared work environment (Sheokand & Dhola, 2025). Higher scores indicate a more positive and supportive OC.
IN was measured using items adapted from Axtell et al. (2000), Janssen (2000), Parker and Collins (2010), and Yeung et al. (2000). The scale captures behaviors such as experimenting with new approaches, suggesting improvements, and supporting the implementation of novel ideas. Respondents indicated the frequency of these behaviors on a five-point scale ranging from “Never” to “Very frequently.”
One negatively worded item (“Compared to our competitors, our company takes a long time to respond to customers”) was reverse-coded so that higher values consistently reflect greater innovation. All items were aggregated into a composite measure, with higher scores indicating stronger engagement in innovation-oriented behaviors.
In addition to the focal constructs and following best practices in family business research (Feranita et al., 2021; Shatila et al., 2024), several control variables were included to account for heterogeneity in perceptions and behaviors. At the individual level, we controlled employee gender, age, educational level, and organizational tenure, as prior research suggests that demographic characteristics and experience may influence perceptions of politics, climate evaluations, and innovative behavior. At the firm level, we controlled for firm size (number of employees) and firm age, as structural characteristics of family SMEs may shape both internal climate and opportunities for innovation. All control variables were included in the mediation analyses and the structural equations model to isolate the effects of POP and OC on IN.
3.3. Reliability and validity
Internal consistency was assessed using Cronbach’s alpha and composite reliability (CR), with all values exceeding the recommended 0.70 threshold (Pearson & Lumpkin, 2011). Construct validity was evaluated through confirmatory factor analysis (CFA). Average variance extracted (AVE) values met or exceeded the 0.50 benchmark, supporting convergent validity, and discriminant validity was established through AVE comparisons and inter-construct correlations reported in Table 1.
Table 1: Descriptive statistics, correlations, reliability, and validity
|
Constructs |
Mean |
SD |
1 |
2 |
3 |
α |
CR |
AVE |
|
1. POP |
3.12 |
0.74 |
.76 |
|
|
.81 |
.84 |
.58 |
|
2. OC |
3.87 |
0.69 |
.21* |
.82 |
|
.90 |
.92 |
.67 |
|
3. IN |
3.71 |
0.73 |
.09 |
.68** |
.79 |
.88 |
.90 |
.63 |
Notes: N = 421. Correlations are reported below the diagonal. Square roots of AVE are reported on the diagonal. α = Cronbach’s alpha; CR = Composite Reliability; AVE = Average Variance Extracted. * p < .05; ** p < .01.
Source: Own elaboration
3.4. Analytical strategy
To evaluate the proposed hypotheses, we employed a regression-based analytical strategy combined with Structural Equation Modeling (SEM). The analyses were conducted using SPSS 29 and AMOS 28. This approach follows established mediation practices in organizational and family business research (Sánchez-Famoso et al., 2023; Yasin, 2021) and allows for the systematic examination of both direct and indirect relationships among the study variables.
As an initial step, descriptive statistics were computed to summarize the distributional properties of the variables and key sample characteristics. These statistics are reported in Table 1, which provides an overview of POP, OC, IN, and the control variables included in the analyses. Bivariate correlations and discriminant validity assessments were subsequently examined to evaluate pairwise associations and the empirical distinctiveness of the core constructs prior to multivariate modeling.
Hypotheses 1 and 2 were examined using regression-based analyses. Specifically, IN was regressed on POP to assess the baseline relationship between them. In contrast, OC was regressed on POP to test the proposed relationship between organizational politics and OC. All models incorporated control variables at both the individual and firm levels, including employee role, gender, tenure, firm size, number of employees, and owner’s age. Categorical variables were dummy-coded, and continuous variables were standardized where appropriate.
Hypothesis 3 was tested using a regression-based mediation analysis in which OC was specified as the intervening variable linking POP and IN. The mediation procedure was conducted in SPSS 29 using a bias-corrected bootstrapping approach with 5,000 resamples to estimate the indirect effect without relying on normality assumptions. This analysis estimated the direct effects (POP → OC, OC → IN, and POP → IN) and the indirect and total effects associated with the proposed mediation model. The corresponding coefficients, standard errors, p-values, and confidence intervals are reported in Table 2. To complement this mediation analysis, a structural equation model was subsequently estimated in AMOS 28 to examine the overall adequacy of the proposed model within an integrated analytical framework. The structural equation model was used as a confirmatory and complementary procedure rather than as the primary test of mediation. It enabled the simultaneous estimation of the relationships among POP, OC, and IN and provided overall model fit indicators, including CFI, TLI, RMSEA, and SRMR. Consistent with its conceptualization, OC was modeled as a higher-order construct.
4.1. Descriptive statistics and measurement diagnostics.
The descriptive statistics, correlations, reliability estimates, and validity indicators show adequate variability across POP, OC, and IN (Table 1). Cronbach’s alpha and composite reliability (CR) values exceed the recommended thresholds, supporting internal consistency. In addition, the square roots of the average variance extracted (AVE) exceed the inter-construct correlations, providing evidence of discriminant validity under the Fornell–Larcker criterion. Overall, these results support the suitability of the constructs for subsequent multivariate and mediation analyses.
4.2. Hypothesis testing and regression-based mediation analysis
Table 2 presents the results of the regression-based mediation analysis used to test the proposed model. Hypothesis 1 proposed a significant overall association between POP and IN. The total association between POP and IN was positive but not statistically significant (β = 0.021, p = 0.662), indicating no evidence of a significant baseline relationship between political perceptions and innovation-related behavior in family-owned SMEs.
Hypothesis 2 proposed a positive relationship between POP and OC. The results show that POP has a positive, statistically significant effect on OC (β = 0.207, p < 0.001), supporting Hypothesis 2.
Hypothesis 3 proposed that OC mediates the relationship between POP and IN. As shown in Table 2, OC exhibits a strong positive effect on IN (β = 0.540, p < 0.001). In addition, the bootstrapped indirect effect of POP on IN through OC is positive and statistically significant (β = 0.112, p < 0.001), based on 5,000 bias-corrected bootstrap resamples. By contrast, the residual direct effect of POP on IN remains non-significant after accounting for the mediator. This pattern is consistent with an indirect-only (full) mediation effect.
The control variables also exhibit several significant relationships. Company tenure is positively associated with OC, whereas company size is negatively associated with OC. Regarding IN, the number of employees, the age of entrepreneurs, and company size show positive, statistically significant effects.
Table 2. Regression-based mediation analysis
|
Path / Relationship |
Coef. (β) |
SE |
p-value |
95% C.I. (Lower) |
95% C.I. (Upper) |
|
A. Mediation Paths |
|||||
|
POP→OC (Path a) |
0.207*** |
0.041 |
<0.001 |
0.125 |
0.288 |
|
OC→IN (Path b) |
0.540*** |
0.038 |
<0.001 |
0.465 |
0.614 |
|
POP→IN (Path c) |
0.021 |
0.053 |
0.662 |
-0.076 |
0.118 |
|
B. Defined Effects |
|||||
|
Indirect Effect (a×b) |
0.112*** |
0.025 |
<0.001 |
0.063 |
0.160 |
|
Total Effect (c+a×b) |
0.133** |
0.048 |
0.004 |
0.038 |
0.229 |
|
C. Control Variables Predicting OC |
|||||
|
Company Tenure |
0.134*** |
0.035 |
<0.001 |
− |
− |
|
Company Size |
−0.088* |
0.038 |
0.024 |
− |
− |
|
D. Control Variables Predicting IN |
|||||
|
Number of Employees |
0.096* |
0.040 |
0.016 |
− |
− |
|
Entrepreneur Age |
0.100* |
0.039 |
0.011 |
− |
− |
|
Company Size |
0.101* |
0.040 |
0.012 |
− |
− |
Source: Own elaboration
4.3 Structural equation model
The mediation structure was further examined using SEM, which simultaneously estimated the direct and indirect relationships among POP, OC, and IN. Consistent with the conceptual model, OC was specified as a higher-order composite construct. Figure 2 presents the resulting structural mediation model, in which OC operates as the central explanatory mechanism linking POP and IN.
To maintain consistency between the conceptualization and empirical specification of the model, job satisfaction and work engagement are represented solely as illustrative observed manifestations associated with the broader OC construct and are not modeled as independent latent variables, predictors, or mediators.
The structural equation model demonstrated an acceptable overall model fit (CFI = .95, TLI = .94, RMSEA = .048, SRMR = .041), supporting the adequacy of the proposed mediation structure. The SEM results are fully consistent with the regression-based mediation analysis reported in Table 2. Specifically, the path from POP to OC is statistically significant, the path from OC to IN is positive and significant, and the residual direct path from POP to IN remains non-significant.
Figure 2. Structural mediation model linking POP, OC, and IN
Source: Own elaboration
This study contributes to the literature on family firms by demonstrating that the relationship between POP and IN operates primarily through OC. Rather than exerting a direct influence on innovation-related behavior, political perceptions appear to acquire behavioral relevance through the broader relational and socioemotional environment in which employees interpret organizational dynamics. In this sense, the findings support the view that OC functions as a central socioemotional and interpretive mechanism within family firms.
The absence of a statistically significant residual direct effect of POP on IN suggests that political perceptions, in isolation, do not shape innovation-related behaviors in family firms. Instead, employees appear to interpret political dynamics through the collective meanings, relational norms, and emotional expectations embedded in the OC. This finding is particularly relevant in family business contexts, where interpersonal trust, long-term orientation, and affective commitment frequently shape organizational behavior beyond formal structures or economic incentives (Brundin et al., 2023; Gómez-Mejía et al., 2011).
These findings contribute to ongoing debates regarding the role of organizational politics in shaping innovation processes. Much of the prior literature portrays POP primarily as a dysfunctional organizational phenomenon associated with stress, uncertainty, and reduced employee initiative. However, the present findings suggest a more contingent interpretation in family-owned SMEs. Political perceptions do not appear to suppress innovation uniformly; rather, their consequences depend on the relational and socioemotional conditions through which they are interpreted and enacted. This interpretation aligns with recent calls in the family business literature to move beyond simplistic assumptions regarding governance and internal dynamics and to examine more carefully how power, relationships, and emotions interact within family firms (De Massis et al., 2021).
The findings also resonate strongly with the SEW perspective (Gómez-Mejía et al., 2007). From this perspective, OC may be understood as a manifestation of shared socioemotional priorities that regulate behavior within the firm. In family firms, political dynamics may sometimes reflect efforts to preserve relational stability, family cohesion, or continuity rather than purely self-interested opportunism. Consequently, political perceptions filtered through a supportive OC may coexist with innovation-related behaviors rather than necessarily inhibiting them.
An additional contribution of this study lies in integrating the research on organizational politics with emerging discussions of relational governance and emotional embeddedness in family firms. By conceptualizing OC as the principal mediating mechanism, the study highlights the importance of informal organizational processes in shaping innovation outcomes. This interpretation is consistent with recent research emphasizing the role of relational governance, emotional dynamics, and informal influence structures in family business innovation processes (Capella et al., 2024).
Overall, the findings support a more integrative understanding of innovation in family-owned SMEs. Rather than depicting these firms as uniformly constrained by politics or socioemotional considerations, the results suggest that family firms may channel political dynamics through supportive climates that facilitate innovation-related behaviors. OC, therefore, emerges as a critical relational mechanism through which family firms reconcile internal political dynamics with the pursuit of innovative outcomes.
This study advances the understanding of how internal political dynamics shape innovation-related behavior in FOS. The findings indicate that POP do not exert a direct influence on IN. Instead, their effects are transmitted through OC, which emerges as the central mechanism linking political perceptions to innovation outcomes. Specifically, POP is positively associated with OC, and OC, in turn, strongly promotes innovation-oriented behavior. This indirect-only (full) mediation pattern underscores the importance of OC in translating political perceptions into constructive employee action.
Taken together, the findings suggest that the consequences of organizational politics in family firms are fundamentally context dependent. Although political behavior is frequently associated with conflict and self-serving conduct, the results suggest a more nuanced interpretation in the context of family-owned SMEs. In relationally embedded organizations characterized by informal governance, long-term orientation, and socioemotional priorities, political perceptions are filtered through shared norms and expectations that shape the OC. Under such conditions, political dynamics may contribute to coordination, legitimacy building, and the mobilization of effort that supports innovation.
Viewed through the lens of SEW, the findings suggest that political perceptions in family firms cannot be understood exclusively through instrumental or agency-based perspectives. Rather than necessarily undermining innovation, political dynamics may reflect efforts to preserve relational harmony, family identity, and continuity. In this sense, OC functions as a contextual mechanism that transforms political perceptions into either enabling or constraining conditions for innovation-related behavior.
6.1 Theoretical implications
This study contributes to the literature at the intersection of organizational behavior, innovation, and family business by clarifying how POP and OC jointly shape innovation in family-owned SMEs. By integrating the organizational politics literature with the SEW perspective, the study advances several theoretical contributions.
First, the findings extend SEW theory (Gómez-Mejía et al., 2007) by demonstrating that political perceptions do not uniformly suppress innovative behavior in family firms. Instead, their effects depend on the OC through which they are interpreted, highlighting the importance of relational and affective contexts in shaping employee responses to political dynamics.
Second, building on recent work on the politics of innovation in family firms (Capella et al., 2024), the study shows that political dynamics can function as a form of political capital when embedded in a supportive climate. By conceptualizing OC as a mediating mechanism, the study demonstrates how informal influence processes may mobilize innovative effort rather than merely generate dysfunction.
Third, the findings reinforce the ecosystem view of family firms proposed by De Massis et al. (2021), emphasizing that innovation should be understood within broader configurations of informal governance, relational influence, and non-financial goals. By identifying OC as the key pathway linking political perceptions and innovation, the study contributes to a more refined understanding of the micro-level foundations of innovation in family business settings.
Overall, the findings support a more balanced and context-sensitive understanding of organizational politics, recognizing both its constraining and enabling potential in family firms.
6.2 Practical implications
For practitioners, the findings suggest the need to rethink how organizational politics are managed in family-owned SMEs. Rather than attempting to eliminate political behavior—which is often unrealistic and potentially counterproductive—leaders should focus on cultivating an OC that channels political dynamics toward constructive outcomes. Fostering psychological safety, trust, and shared purpose may help employees interpret political behavior as legitimate coordination rather than self-serving maneuvering.
In practical terms, this may involve clarifying roles and decision rights, recognizing individual and collective contributions, and creating structured spaces for dialogue between family and non-family employees. As family firms grow and become more organizationally complex, such practices become increasingly important for sustaining innovation while preserving relational cohesion.
At the same time, the findings do not imply that all political behavior is beneficial. Leaders must remain attuned to distinguishing destructive tactics from ethical forms of influence—such as advocacy, coalition-building, and negotiation—that align with organizational goals. Developing the capability to recognize and manage these dynamics should therefore become an important priority in family business governance, leadership development, and succession processes.
6.3 Limitations and future research
Several limitations should be acknowledged. Snowball sampling is frequently employed in family business research when comprehensive sampling frames are difficult to construct, and organizational access depends heavily on relational trust (Parker et al., 2019). Nevertheless, this non-probabilistic approach may limit representativeness and increase the likelihood of homogeneity in firm characteristics (Etikan, 2016).
Although the use of mediation analysis and SEM strengthens the examination of the proposed relationships, the cross-sectional nature of the data limits conclusions regarding temporal dynamics and causal ordering. Longitudinal research would be valuable for examining how political perceptions and OC evolve over time and jointly shape innovation-related behavior in family firms. In addition, POP and OC were measured at the individual level; future studies could benefit from multi-level designs that more fully capture firm-level political dynamics.
Future research could also explore additional psychological and behavioral mechanisms through which OC influences innovation, such as self-regulation, learning behaviors, or collective efficacy. Comparative studies across family and non-family firms, as well as across cultural and institutional contexts, would further illuminate the conditions under which political dynamics foster or hinder innovation. Such extensions would deepen understanding of how internal organizational processes shape innovation in complex and relationally embedded firms.
The authors contributed equally to the work.
The authors declare that they have no known competing financial interests or personal relationships that could have appeared to influence the work reported in this paper.
This study was conducted in accordance with ethical research standards. All participants were informed about the purpose of the research and voluntarily agreed to participate. Informed consent was obtained from all respondents, and all responses were anonymized to ensure confidentiality. No sensitive personal data were collected.
Generative artificial intelligence tools were not used for data analysis, interpretation of results, or hypothesis development. Any language editing support did not affect the intellectual content of the manuscript.
The data supporting the findings of this study are available from the corresponding author (E.R.S.) upon reasonable request.