Role of green innovation and firm transparency on the relationship between corporate environmental responsibility and firm performance of Chinese manufacturing companies

This study aimed to understand whether the two dimensions of corporate environmental responsibility (CER), CER strength and CER concern, had significant influences on a firm’s green innovation and performance (social, environmental and financial). This study also explored the mediating role of green innovation as well as the moderating role of firm transparency in the relationship between the two dimensions of CER and firm performance. Data was collected from 281 listed manufacturing firms in the Shanghai and Shenzhen Stock Exchange. Data was analyzed using the Feasible Generalized Least Squares (FGLS) regressions on unbalanced static panel data using Stata. The results of this study indicated that CER strength had a significant positive effect on green innovation and firm performance while CER concern had a significant negative effect on green innovation and firm performance. This study also found that green innovation played a partially mediating role and firm transparency was a significant moderator between the CER dimensions and firm performance. In this study, CER was separated into CER strength and CER concern which allowed a more comprehensive understanding of the relationship between CER, green innovation and firm performance in a more fine-grained manner and contributes further to CER literature. This study also found that the mediating role of green innovation and the moderating role of firm transparency provided novel relational pathways to explain the underlying mechanism and boundary conditions of the CER-firm performance relationship. There are three managerial implications from this study. First, organizations can benefit by focusing on the specific CER dimensions that foster green innovation and subsequently enhance firm performance. Second, to optimize firm performance, managerial efforts should be directed at embracing CER initiatives, while simultaneously fostering an environment conducive to the growth of green innovation. This strategy empowers firms to secure a competitive edge and elevate overall performance. Finally, organizational transparency and stakeholder communication emerge as critical factors in bolstering firm performance. By prioritizing transparency, firms can contribute to improved overall performance and stakeholder relations.

Text 125301 - Full Text.pdf Download (2MB) Text SPE 2023 24 - Declaration Form.pdf Restricted to Repository staff only Download (520kB) Text SPE 2023 24 - Full Text.pdf Restricted to Repository staff only Download (2MB) Official URL or Download Paper: http://ethesis.upm.edu.my/id/eprint/18845

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