The Penetration of Green Innovation on Firm Performance: Effects of Absorptive Capacity and Managerial Environmental Concern

Abstract

Under the background of environmental sustainability, it is of great significance to investigate how green innovation influences firm performance dimensions in emerging economies. Explicitly, the interaction effects of absorptive capacity (AC) and managerial environmental concern (MEC) on the correlation between green innovation and firm performance dimensions must be explored. Our data were obtained through a questionnaire survey from 253 companies operating in China. Using hierarchical linear modeling (HLM), we found that (1) green innovation has a robustly positive effect on firm performance dimensions (operational, financial and environmental), and (2) absorptive capacity and managerial environmental concern can positively affect the correlation between green innovation and firm performance dimensions. Our results illustrate the integrating effects of absorptive capacity, managerial environmental concern, green innovation and firm performance dimensions.

Labor Costs, Market Environment and Green Technological Innovation: Evidence from High-Pollution Firms

“…According to Porter's theory of competitive advantage, if a company implements green technological innovation, it is expected to include increased product competitiveness, reduced production costs, and improved corporate image [33]. To reduce the model analysis, referring to the common methods of economic models, benefits such as competitiveness and corporate image can be quantified as a reduction in production costs [43].…”

“…These benefits can enhance the competitive advantage of firms. Green technological innovation can also create obstacles for competitors [23], and the "isolation mechanism" created by green technological innovation can preserve profit margins and allow firms to gain [32,33]. Benefiting from the cost reduction and revenue increase contributed by green technological innovation, firms can become more competitive [34].…”

“…Pressure from suppliers, consumers, and other stakeholders will also promote firms to implement green technological innovation [38,39]. The latest research mainly analyzes the driving factors of green technology innovation from the perspective of internal organizational environment, external social environment, and stakeholder factors [33,40,41].…”

Green Innovation Mode under Carbon Tax and Innovation Subsidy: An Evolutionary Game Analysis for Portfolio Policies

“…Manufacturers thus face the trade-off between costs and benefits when deciding their green innovation mode. Although research has shown that green innovations are positively related to corporate competitiveness and performance [14], many manufacturers still hesitate to develop or adopt radical green innovations due to the associated high R&D spending and production costs, which they believe will weaken their competitiveness [15].…”

Sustainability and Firm Performance: A Review and Analysis Using Algorithmic Pathways in the Throughput Model

“…Finally, as most previous studies have suggested (e.g., Cupertino et al [96]; Masocha [97]; Xue et al [98]) the sustainability issues such as environmental, social, and governance standards, may enhance an organization's innovation and long-term growth with a positive effect on its long-term value. The next section adds to this literature by incorporating a model (i.e., throughput model) that examines sustainability issues via a process apparatus as opposed to a black box.…”