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The purpose of this research is to examine how the chief exective officers (CEO's) transformational leadership impacts organizational innovation and individual innovative behavior, through the mediating role of collaborative human resource management (HRM) practices.

By using a stratified sampling technique, the data were obtained from ten Microfinance banks located in five metropolitan cities of Pakistan. By adopting a purposive sampling technique, total 427 responses were received out of which 411 responses were considered for data analysis. Structural equation modeling (SEM) technique was adopted using AMOS 21.0 to test the developed hypotheses.

The findings of the study described a significant and positive relationship between CEO transformational leadership and collaborative HRM. The collaborative HRM has also a positive impact on organizational innovation and individual innovative behavior. Moreover, the results revealed that collaborative HRM fully mediates between CEO transformational leadership and organizational innovation. However, partial mediate between CEO transformational leadership and individual innovative behavior.

The results of this study can be helpful for bank organizations and policymakers who have extended vision and anticipate the significance of innovation in a fast-changing market. The results of the study also provide the space and scope for prospective researchers and scholars for further research.

There is substantial literature existing on the relationship between CEO transformational leadership, organizational innovation and individual innovative behavior. However, the study finds this that only few researchers took the opportunity to observe the mediating role of collaborative HRM on the relationship between CEO transformational leadership, organizational innovation and individual innovative behavior in the context of Pakistan.