Sustaining the sustainable development: How do firms turn government green subsidies into financial performance through green innovation?

The impact of government green subsidies on firms' green innovation behaviors and sustainable development has been recognized in the existing literature, but the deep relationship remains poorly understood. This study aims to examine the mechanism of how government green subsidies influence firms' financial performance via green innovation and how the mediating effect varies under different contingent conditions. Empirical results based on data of Chinese listed companies between 2006 and 2018 reveal that green subsidies have positive effects on green process and product innovation, but only green product innovation can rise higher financial performance, which further verifies that green subsidies positively influence financial performance through green product innovation rather than green process innovation. In addition, both higher absorptive capacity and higher market turbulence strengthen the indirect effect of green subsidies on firms' financial performance via green product innovation. Our study provides useful implications for enterprises by revealing the influence mechanism of green subsidies on financial performance through green innovation under different leveraging levels of internal and external conditions. It also provides basis for the government to formulate relevant environmental policies.     

Green innovation to respond to environmental regulation: How external knowledge adoption and green absorptive capacity matter?

Although environmental regulations have been considered as important forces of conducting green innovation, how and under what conditions they affect green innovation are still unclear. Drawing from institutional theory, this study used survey data from 237 manufacturing firms in China to investigate how two dimensions of environmental regulations (i.e., command and control regulation and market‐based regulation) affect green product innovation and green process innovation. Further, this article examined the mediating role of external knowledge adoption and the moderating role of green absorptive capacity. Our results indicate that both command and control regulation and market‐based regulation have positive influences on external knowledge adoption. External knowledge adoption fully mediates these positive relationships. In addition, green absorptive capacity only strengthens the positive impact of market‐based regulation on external knowledge adoption. Our study contributes to institutional theory and green innovation literature.     

Green Knowledge Sharing,Stakeholder Pressure,Absorptive Capacity,and Green Innovation: Evidence from Chinese Manufacturing Firms

A central issue faced by many Chinese manufacturing firms is how to absorb and utilize green knowledge shared among supply chain members for superior green innovation. Invoking the indirect research stream of organizational learning theory, we develop a moderated mediation model in which absorptive capacity mediates the interactive effects of green knowledge sharing and stakeholder pressure on green innovation. Our hypotheses were tested using a sample of 247 Chinese manufacturing firms. The results from multiple regression and bootstrapping tests reveal that absorptive capacity fully mediates the link between green knowledge sharing and green innovation, and the mediation effect is positively contingent upon stakeholder pressure. These findings provide managerial implications for Chinese manufacturing firms, recommending that these firms effectively develop their absorptive capacities and closely monitor stakeholder pressure to realize the green innovation benefits of green knowledge sharing.     

Enhancing green product and process innovation: Towards an integrative framework of knowledge acquisition and environmental investment

Despite the increasing interest in green innovation literature, little is known on how and under what conditions firms' knowledge transfer activities affect green innovation. There is lack of research that on how particular organizational capabilities are seen more useful and how it influences on green innovation performance. To address this research gap, we examine a mediation model in which we explore whether a firm's knowledge acquisition capability and investment in environmental management mediate the impact of buyer-driven knowledge transfer activities on green product innovation and green process innovation. On the basis of an analysis of a sample of 239 manufacturing firms, we find that buyer-driven knowledge activities have a greater positive impact on green product innovation than green process innovation. Investment in environmental management fully mediates the relationship between buyer-driven knowledge transfer activities and green process innovation, and knowledge acquisition capability partially mediates the relationship between buyer-driven knowledge transfer activities and green product innovation. The current study provides evidence that internal competencies and the role of buyers in knowledge transfer are critical for explaining the green product innovation and green process innovation. Our results suggest that buyer involvement pushes firms to develop resource acquisition capability to enhance green product innovation. Our results also highlight the importance of investment in environmental management for overcoming the environmental challenges in the manufacturing firms.     

Exploring the linkages of green transformational leadership,organizational green learning,and radical green innovation

Radical green innovation is the necessary way for countries and firms to achieve sustainable development. Although the influencing factors of green innovation have attracted extensive attention, there is little research on the antecedents of radical green innovation. Drawing on organizational learning theory and attention-based view, this study proposes R-I ratio to measure the configuration of exploratory green learning and exploitative green learning, then analyzes the relationships among green transformational leadership, R-I ratio and radical green innovation, and examines the moderating effects of green R&D investment and environmental regulatory pressure. Based on a sample of 243 manufacturing firms in China's strategic emerging industries, the empirical results reveal that green transformational leadership promotes R-I ratio, and R-I ratio has inverted U-shaped relationship with radical green innovation. The results also find that green R&D investment plays U-shaped moderating role in the relationship between green transformational leadership and R-I ratio, and environmental regulatory pressure positively moderates the relationship between green transformational leadership and R-I ratio. The study not only reveals the relationships of green transformational leadership, organizational green learning and radical green innovation, but also provides theoretical guidance and management practice for manufacturing firms and government to promote radical green innovation.     

An environmental policy of green intellectual capital: Green innovation strategy for performance sustainability

This study examines how green intellectual capital (GIC) affects economic and green performance through green innovation. We show ways in which a firm's performance is influenced by three dimensions of GIC, that is, green human capital (GHC), green relational capital (GRC), and green structural capital (GSC), and use the mediating role of green innovation to explain the relationships. The results of a survey conducted on 138 high-tech firms indicate that the three GIC constructs positively affect economic performance, green performance, and green innovation, respectively. Further analysis finds that green innovation fully mediates the linkage of GHC–economic performance and GSC–green performance and partially mediates the linkage of GRC–economic performance and GRC–green performance. We find that green innovation does not mediate the linkage of GSC–economic performance and GHC–green performance, and this contributes towards business strategy and implementation of green innovation practices.     

Absorptive capacity—one size fits all? A firm‐level analysis of absorptive capacity for different kinds of knowledge

This paper empirically analyzes the effect of R&D activities, human resource and knowledge management, and the organization of knowledge sharing within a firm on the absorptive capacity of innovative firms for three different types of knowledge, namely absorptive capacity to use knowledge from a firm's own industry, knowledge from other industries and knowledge from research institutions. Using data from the German innovation survey, we investigate how firms are able to exploit knowledge from external partners for successful innovation activities. The estimation results show that the determinants of absorptive capacity differ with respect to the type of knowledge absorbed for innovation activities. In particular, we find that the R&D intensity does not significantly influence absorptive capacity for intra‐ and inter‐industry knowledge. Additionally, our results suggest that absorptive capacity is path dependent and firms can influence their ability to exploit external knowledge by encouraging individuals' involvement in a firm's innovation projects. Copyright © 2009 John Wiley & Sons, Ltd.     

A comparison of family and nonfamily small firms in their approach to green innovation: A study of Italian companies in the agri‐food industry

Despite the growing scholars' attention toward green innovation, on the one hand, and family firms, on the other hand, there is still limited attention toward the intersection of these two streams of literature, because very few studies deal with green innovation in family firms. This paper aims at comparing family and nonfamily small firms in their approach to green innovation. To this aim, a multiple case studies methodology was used to understand whether and in which aspects family firms and nonfamily firms differ. In particular, a sample of 14 small enterprises (seven family and seven nonfamily firms) operating in the agri‐food industry and located in Italy was studied. Results suggest that family and nonfamily firms are similar with regard to green innovation characteristics, features of the green innovation process, faced challenges, and achieved outcomes. On the contrary, family firms differ from nonfamily firms in three key areas: firm's motivations, most relevant pressures, and green innovation view.     

Exploring an innovative pivot: How green training can spur corporate sustainability performance

In general, studies on green innovation practices have primarily taken an innovation view to study the costs and benefits to firms. What has been less examined, however, is how green training spurs the intentions and advantages of green innovation. Thus, this paper explores how and when green training influences the likelihood of firms to achieve sustainability performance by using organizational learning theory. Using a dataset of 231 Chinese manufacturing firms, our work shows that green training is positively correlated to corporate sustainability performance via the indirect effect of green innovation behavior. We also find an increasingly positive indirect effect that is conditional on ambidextrous learning; specifically, this indirect effect is least positive for firms with lower ambidextrous learning capacity but stronger for those firms having higher ambidextrous learning capacity. We hold that the key to spurring corporate sustainability performance through green training lies mainly in advancing firms' green innovation behaviors and persistently enhancing their capacities for ambidextrous learning. Thus, this study offers not only new theoretical insights for understanding the effect of green training on corporate sustainability performance but also practical implications for improving corporate sustainability performance within a green economy context.     

Customer green orientation and process innovation alignment: A configuration approach in the global manufacturing industry

Research suggests that manufacturers increasingly innovate processes to meet customer's green requirements; however, little is known about the impact on performance and the contextual conditions, under which they are effective. Grounded on configuration approach, this study develops taxonomies of manufacturing firms based on the degree of customer's green orientation and process innovation. This study argues that performance differences between these clusters, highlight managerial implications for sustainable development. The empirical data used in this study were drawn from Global Manufacturing Research Group (GMRG) survey project (with data collected from 629 manufacturing firms from nine countries). Our results show that customer green innovation taxonomies influence differently on environmental measures, costs, and financial performance. The study proposes three clusters: Process active, Green minimalist, and Green proactive. The main differences between manufacturers are based on the level of investments in joint green improvement initiatives and customer direct investments in green activities. Firms that belong to the Process active cluster, who are first within the industry to deploy new processes and update the latest process development, gained significant improvement in financial measures such as market share and profits. Whereas Green minimalist cluster lagged behind, Green proactive manufacturers aligned in both capabilities to experience higher payoffs in sustainable performance measures and efficiency. The findings provide a step‐by‐step decision‐making process and offer guidance for supply chain managers who have to stretch their needs to align the innovation processes to enhance their sustainable performance.     

Green human resource management and the enablers of green organisational culture: Enhancing a firm's environmental performance for sustainable development

Scholars have shown that green human resource management (GHRM) practices enhance a firm's environmental performance. However, existing studies fail to explain how GHRM initiatives can enable a green organisational culture or how such a culture affects the environmental performance and sustainable development of the firm. This paper examines the relationship between GHRM practices, the enablers of green organisational culture, and a firm's environmental performance. We conduct a large‐scale survey of 204 employees at Chinese manufacturing firms. Our findings suggest that proenvironmental HRM practices including hiring, training, appraisal, and incentivisation support the development of the enablers of green organisational culture. We suggest the key enablers of green organisational culture include leadership emphasis, message credibility, peer involvement, and employee empowerment. Our paper contributes to HRM theory in terms of originality and utility of research by explaining that the enablers of green organisational culture positively mediate the relationship between GHRM practices and environmental performance. Managers are provided with a detailed understanding of the GHRM practices needed to enable an organisational culture of environmentally aware employees. Finally, we address potential implications of this work for teaching green organisational culture to future generations of responsible managers.     

Does gender diversity matter for green innovation?

This study empirically investigated the relationship between board gender diversity and firm's green innovation, using panel data of public companies of China's manufacturing. Green product innovation was assessed by “green” patents and green process innovation assessed by environmental management certification. The endogeneity problem that resulted from self‐selection of gender diversity was addressed by means of extended probit regressions with an instrumental variable, and the instrumental variable was elaborately constructed based on changes in directorships. The findings show that occurrence of green innovation at the firm‐level is systematically related to female board representation. Specifically, women can exert a sizable and positive effect on green innovation, once they enjoy at least two seats on the boards; a further increase in representation of women on the boards can increase the likelihood of green product innovation rather than the likelihood of green process innovation. These results were robust to various regression specifications and alternative samples. The study provides empirical evidence that women at the top management can play a positive role in developing firm's active environmental strategies, and the conclusions are of practical implications for improving corporate governance along the environmental dimension.     

Intellectual Capital–Enhancing HR,Absorptive Capacity,and Innovation

This study investigates the role of intellectual capital (i.e., human, social, and organization capital)–enhancing human resource (HR) practices in the development of a firm's absorptive capacity, as well as the mediating role of absorptive capacity in its relationship to the firm's innovation performance. Results show that while human capital–enhancing HR (acquisition and developmental HR) is positively related to absorptive capacity, social capital–enhancing HR affects absorptive capacity through egalitarian HR practices. Organization capital–enhancing HR practices contribute to absorptive capacity through effective information systems. Finally, our findings confirm that the various intellectual capital–enhancing HR practices affect innovation performance through their impact on the firm's absorptive capacity. © 2016 Wiley Periodicals, Inc.     

Balancing on a tightrope: Managing the boundaries of a firm-sponsored OSS community and its impact on innovation and absorptive capacity

Realizing the innovation potential of OSS communities, firms now create or sponsor their own open source software (OSS) communities, generally as part of an open innovation strategy. However, maximizing the innovation capability of a sponsored OSS community is a challenging task since firms cannot rely on traditional hierarchical authority to control community members. Furthermore, a firm's efforts to manage its sponsored community may also impact the firm's absorptive capacity, or its ability to effectively absorb and leverage the valuable knowledge created by the community. Thus, the purpose of this article is to investigate two research questions: 1) How does the boundary management of a firm-sponsored OSS community impact the community's innovation capacity? and 2) How does the boundary management of a firm-sponsored OSS community impact the firm's absorptive capacity? Using the results from our qualitative analysis of eZ Systems and its successfully sponsored OSS community – eZ Publish – we develop a theoretical model depicting how the boundary management of a firm-sponsored OSS community influences both the community's innovation capacity and the absorptive capacity of the firm. In addition, the results of our study highlight the central importance of an integrative IT platform in boundary management activities.     

The influence of supply network structure on firm innovation

In this study, we examine the structural characteristics of supply networks and investigate the relationship between a firm's supply network accessibility and interconnectedness and its innovation output. We also examine potential moderating effects of absorptive capacity and supply network partner innovativeness on innovation output. We hypothesize that firms will experience greater innovation output from (1) higher levels of supply network accessibility and supply network interconnectedness, (2) the interaction between the levels of these two structural characteristics, (3) the moderating role of absorptive capacity on supply network accessibility and the moderating role of supply network partner innovativeness on supply network interconnectedness. Supply network partner relationships are drawn in the context of the electronics industry using data from multiple sources. We use social network analysis to create measures for each supply network structural characteristic. Using regression techniques to test the relationship between these structural characteristics and firm innovation for a sample of 390 firms, our findings suggest that supply network accessibility has a significant association with a firm's innovation output. The results also indicate that interconnected supply networks strengthen the association between supply network accessibility and innovation output. Moreover, the influence of the two structural characteristics on innovation output can be enhanced by a firm's absorptive capacity and level of supply network partner innovativeness. By addressing the need for deeper structural analysis, this study contributes to supply chain research by accounting for the embedded nature of ties in supply networks, and showing how these structural characteristics influence the knowledge and information flows residing within a firm's supply network.     

Employment impacts of cleaner production – evidence from a German study using case studies and surveys

The study assesses net employment effects of technical progress, which can be expected by the ongoing transition from end‐of‐pipe technologies towards cleaner production. Empirical evidence is presented on the basis of case studies and firm data including a telephone survey from German industry. The main result is that the transition from end‐of‐pipe technologies to cleaner production leads to a net creation of jobs, which is however restricted to a only small number of firms and to the group of highly skilled labour. Eco‐innovations, like other innovations, are non‐neutral. The demand for skilled and highly skilled labour rises while the demand for unskilled labour decreases. Synergies between environmental, labour market and innovation policy are apparent but they are however small and specific. The exploitation of these synergies requires the design of specific policy programmes differentiating between types of eco‐innovation. The promotion of product‐integrated environmental measures should be more successful if new products complement older ones, while process‐integrated environmental measures should be more successful if consumers' demand is more price elastic. Copyright © 2001 John Wiley & Sons, Ltd. and ERP Environment     

CEO hometown identity and firm green innovation

Drawn on the upper echelons theory, this study investigates how chief executive officer (CEO) hometown identity drives firm green innovation. We propose that CEO hometown identity has a positive impact on a firm's green innovation performance. Furthermore, we explore the moderating role of managerial discretion determined by organizational and environmental factors (i.e., institutional ownership and market complexity). We propose that institutional ownership negatively moderates the positive relationship between CEO hometown identity and green innovation, but market complexity plays a positive moderating role. Using Chinese publicly listed firms from 2002 to 2016 in heavily polluting industries, our findings support these hypotheses. Our research contributes to the upper echelons theory and corporate social responsibility literature and has substantial practical implications.     

Exploratory and exploitative innovation: To what extent do the dimensions of individual level absorptive capacity contribute?

Individuals are considered the frontline that allows firms to learn from external sources. However, a firm can only benefit from individual efforts if it understands to what extent the dimensions of individual-level absorptive capacity are related to its innovation strategy. A firm's innovation strategy is characterized by the notions of exploration and exploitation, which result in either radical or incremental innovation. This study examines the driving factors of individual-level absorptive capacity regarding a firm's exploration versus exploitation strategy. Using quantitative data from 104 individuals, partial least squares structural equation modeling (PLS-SEM) analysis was conducted, verifying individuals' competencies in identifying external knowledge as a trigger for both exploratory and exploitative innovation. Consequently, these specific abilities also contribute to organizational ambidexterity. Furthermore, the results show the dichotomous contribution of individual competencies in assimilating external knowledge. While exploratory innovation thrives with individual assimilation efforts, realization of exploitative innovation is not significantly related to these efforts. Ultimately, individuals' competencies in utilizing external knowledge are significantly related to neither exploratory nor exploitative innovation. Moreover, this study provides means for managers to systematically position individuals in the external search process.     

Talent management,absorptive capacity,and firm performance: Does it work in China and Russia?

This article investigates the relationship between talent management (TM), absorptive capacity (AC), and firm performance. We build a theoretical framework and examine the mediating role of a firm's AC in TM–performance relationships in the contexts of China and Russia. We use a sample of 120 Chinese and Russian firms to provide empirical evidence of our hypotheses. Our results show for both Chinese and Russian firms, a well‐developed TM system positively influences a firm's ability to acquire, assimilate, and exploit knowledge as well as increase the overall level of a firm's AC. We also found support for the argument that TM has an indirect positive effect on firm performance through its AC; moreover, the effect is stronger for Chinese firms, specifically, within the link between AC and performance.     

Boundary‐spanning search and firms' green innovation: The moderating role of resource orchestration capability

Building on resource‐based theory and resource orchestration theory, we investigate the impact of two characteristics of boundary‐spanning search, search breadth and search depth, on firms' exploitative and exploratory green innovations. We also examine the moderating role of resource orchestration capability. The results of data analysis from 186 manufacturing firms in China show that both search breadth and search depth have inverted U‐shaped relationships with exploitative and exploratory green innovations. Furthermore, resource orchestration capability is found to moderate the inverted U‐shaped relationship between boundary‐spanning search and green innovation. Specifically, with high resource orchestration capability, the inverted U‐shaped relationships of search breadth with exploitative and exploratory green innovations are flattened, whereas the relationships of search depth with exploitative and exploratory green innovations are almost linear. Our research contributes to the literature on green innovation by uncovering the complex effects of boundary‐spanning search on exploitative and exploratory green innovations.