Can green process innovation improve both financial and environmental performance? The roles of TMT heterogeneity and ownership

Xuemei Xie, Yuhang Han and Thu Thao Hoang

Technological Forecasting and Social Change, 2022, vol. 184, issue C

Abstract: The overuse of natural resources has caused many environmental concerns. Green process innovation (GPI) has been seen as an effective solution that can benefit both industry and society. However, prior studies have not fully examined the contingent mechanisms of the relationship between GPI and both environmental and financial performance. This study fills this research gap. Using the data of 172 manufacturing firms (including 104 state-owned and 68 non-state-owned manufacturing firms) in China, this work investigates the impacts of GPI on both environmental and financial performance, with a particular focus on the moderating roles of top management team (TMT) heterogeneity and firm ownership. The results present valuable findings. First, we found that GPI has a significant positive effect on firms' environmental performance. We also show that although GPI does not improve firms' financial performance significantly in the short term, additional analysis demonstrated that three-year-lagged GPI does indeed have a positive effect on firms' financial performance. Second, we established that strong TMT heterogeneity enhances the link between GPI and firms' environmental and financial performance. Third, we revealed that the relationship between GPI and firms' financial performance is enhanced for state-owned enterprises (SOEs), but, surprisingly, that the link is weakened for SOEs. Overall, the findings of this study present new implications for academics, managers, and policymakers, as they uncover the impacts of GPI on environmental and financial performance by leveraging levels of TMT heterogeneity and firms' ownership status.

Keywords: Green process innovation; TMT heterogeneity; Ownership; Environmental performance; Financial performance (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S004016252200539X
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:tefoso:v:184:y:2022:i:c:s004016252200539x

DOI: 10.1016/j.techfore.2022.122018

Access Statistics for this article

Technological Forecasting and Social Change is currently edited by Fred Phillips

More articles in Technological Forecasting and Social Change from Elsevier
Bibliographic data for series maintained by Catherine Liu ().