Process failed: spawn /bin/sh ENOENT - when running tests

[MurzNN]

I installed the extension and see the Niwghtwatch Test Provider (html) in the Testing sidebar, it even shows all test files in the lists.
But when I'm running the tests, I see an error in the "Output" tab:

Process failed: spawn /bin/sh ENOENT

Enabling debug mode doesn't add any clue about how to resolve it, there still is only one line in the output, and that's all, only a notification "Failed to obtain test file list, something went wrong 🫣" appears.

How can I debug the source of this issue?