Empowering Green Innovation: How CEO and Firm-Level Factors Shape Sustainable Business Growth in Indonesia

Although there has been much research into green innovation, limited studies focus on the influence of internal factors on green innovation. This paper investigates whether and how two internal factors, such as green market orientation and absorptive capacity, facilitate green innovation. By dividing green innovation into green product innovation and process innovation, we also test the differential effects of the two internal factors on green product innovation and process innovation. Using a survey of 262 manufacturing firms in China, our results show that green market orientation improves only green product innovation, not green process innovation, whereas green absorptive capacity improves green product innovation and process innovation simultaneously. Green market orientation (green absorptive capacity) has a stronger impact on green product (process) innovation than on green process (product) innovation. Further, we find that a positive interaction effect of green market orientation and absorptive capacity on green product innovation and process innovation is significant. The findings contribute to the green innovation literature by providing an integrated framework for exploring whether the pursuit of green market intelligence and technological knowledge improves green product innovation and process innovation.

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.

PurposeThe purpose of this article is to investigate the influences of green product innovation and product process innovation on two constructs of green innovation casual chain: green product competitive advantage and green new product success. The impacts of green product competitive advantage as a partial mediator in the link between green product/process innovations and green new product success are also examined.Design/methodology/approachA model with four constructs is presented and tested on a sample of 203 R&D project leaders of electronics firms operating in China using quantitative methods.FindingsIt is found that green product and process innovations are positively associated with green product competitive advantage and green new product success, and green product competitive advantage partially mediates the relationships between green product/process innovations and green new product success. It is also found that green product innovation exerts a stronger influence on the consequential constructs than green process innovation.Practical implicationsThe positive causalities among the constructs suggest that green innovation is more than a branding support. It pays to pursue green innovation. Green product innovation is demonstrated to have a positively stronger influence on both green product competitive advantage and green new product success than green process innovation. The difference in impact signals that when operating under limited resources, green product innovation should be pursued first.Originality/valueThe article addresses the gap in green innovation theory concerning the associations among the key constructs of green innovation causal chain. It is the first green innovation research ever conducted in the e‐industry in China. The causalities identified can be leveraged to improve Chinese e‐industry players’ innovative and competitive capabilities and to encourage them to stay proactive in addressing challenges arising from environmental issues.

ObjectiveThe main purpose of this study is to investigate the impact of green product and process innovation on the competitive advantages of the Chinese automobile industry during coronavirus disease 2019 (COVID-19). This study also examined the mediating role of corporate environmental ethics (CEE) and the moderating role of corporate environmental management in the relationship between the green product and process innovation on the competitive advantages of the Chinese automobile industry during COVID-19.MethodsThis study used a quantitative approach of research with the cross-sectional method for the collection of data. This study also used purposive sampling for the collection of data from the production managers of the automobile industry of China. The structural equation modeling-partial least squares (SEM-PLS) is used to analyze the data.ResultsThe results of direct effects indicated that green product innovation has a significant and positive effect on the corporate advantages (β = 0.294, t = 2.868) and green process innovation also has a significant and positive effect on the corporate advantages (β = 0.350, t = 3.276). Moreover, green product innovation has also a significant effect on corporate advantages (β = 0.334, t = 4.258) and green product innovation has also a significant effect on corporate advantages (β = 0.269, t = 3.202).SignificanceThe research in this domain about the antecedents of green innovation is still minimal in the previous literature. One of the antecedents of the green innovation, corporate environmental ethics is discussed in this study; thus, it provides the understanding of green innovation as the mediator which would mediate the relationship between corporate environmental ethics and competitive advantage in the auto manufacturing industry of China.NoveltyThis study is among very few to examine the relationship between green innovation, corporate environmental ethics, corporate environmental management, and competitive advantages of the Chinese automobile industry during COVID-19.

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.

Under the “dual carbon” strategy, innovation driving has become the core force for corporate green transformation, with human resources, a key element of green innovation, increasingly gaining attention. This study utilizes data from A-share listed companies to evaluate the impact of China’s urban talent introduction policies on corporate green innovation, focusing on the three dimensions of green product, process, and management innovation. The results reveal that urban talent introduction policies significantly promote corporate green innovation in three areas: green product innovation, green process innovation (end-of-pipe pollution control), and green management innovation. The influx of high-quality talent and optimization of the labor structure represent vital pathways for achieving this impact. Different talent types play different roles in different dimensions of green innovation. Heterogeneity analysis indicates that talent introduction policies have a stronger promoting effect on the green innovation performance of large enterprises, technology-intensive industries, and enterprises in relatively weak regional economies. For enterprises with public–private partnerships, talent admission policies have a more pronounced impact on their green product innovation and process innovation (end-of-pipe pollution control). Furthermore, the impact of talent policy on corporate green innovations in products and processes varies with the intensity of local government intervention. This study emphasizes the key role of talent introduction policies in promoting green innovation, providing theoretical foundations and policy references for implementing sustainable development strategies and environmental protection objectives.

PurposeDeveloping eco-friendly businesses through green process innovation and green product innovation has become prevalent in generating profits and demonstrating environmental responsibility. However, contemporary hospitality management research has overlooked the impact of green training in influencing green process innovation and green product innovation. The focal study aims to understand how green training can foster green process innovation and green product innovation. We aim to examine dual mediating mechanisms, such as adaptive capability and environmental orientation, to assess the connection between green training, green process innovation and green product innovation.Design/methodology/approachThe study analyzed 308 responses from middle and junior-level managers working in five-star hotels in China through structural equation modeling.FindingsThe results exhibit that managers’ green training positively relates to green process innovation and green product innovation. The evidence specifies that adaptive capability and environmental orientation are dual mediation mechanisms connecting green training to green process innovation and green product innovation.Research limitations/implicationsThe research model has been tested in Chinese hotels; the scholar community can expand to other service industries, specifically healthcare, education institutes, transportation, and government services. This research emphasized green training as a GHR practice; researchers could focus on other human resource tools, such as recruitment and selection, rewards and benefits, talent management, and employee engagement, to research their influence on green innovation management.Practical implicationsThis work has practical implications for academics, managers and policymakers, demonstrating that disseminating green training programs can help achieve green process innovation and green product innovation in the environmental sustainability agenda. Further, adaptive capability and environmental orientation should also be fostered among the organizational members to increase green process innovation and green product innovation.Originality/valueThis study advances the natural resource-based view by discovering a dual mediation mechanism that provides insights into how green training can shape green process innovation and green product innovation in organizations.

Although organizational green culture and environmental ethics are increasingly acknowledged as crucial, few studies have comprehensively examined the interconnected relationship between green innovation and sustainable performance, particularly within manufacturing firms. As such, this study empirically examines the relationship between environmental ethics and sustainable performance through the mediating roles of green process and product innovations and the moderating role of organizational green culture on these relationships. It is grounded in stakeholder theory and a resource-based view. This study utilizes 236 valid cross-sectional data points from manufacturing firms in Turkey to test the proposed integrated theoretical model through structural equation modeling (SEM). Environmental ethics is positively associated with sustainable performance, green process innovation, and green product innovation. Green process innovation positively affects sustainable performance. Additionally, both green process and product innovations mediate the relationship between environmental ethics and sustainable performance. Moreover, organizational green culture enhances the relationship between environmental ethics and both green process innovation and green product innovation while moderating its role in sustainable performance. The findings highlight how environmental ethics, mediated by green innovation and moderated by organizational green culture, can drive sustainable performance, offering valuable insights for managers aiming to enhance sustainability initiatives in the manufacturing sector.

Sustainable practices through green innovation have become key while the organization aims to achieve COP26 (Conference of the Parties, 26th Summit) targets. This study examined the relationship between management environmental concern, green process innovation, green product innovation and green performance in China’s hotel industry. It further examines the mediating role of green products and process innovation between management environmental concerns and green performance. Researchers utilized Structural Equation Modelling using Partial Least Squares version 4 to test theory and path analysis. Findings suggest that management environmental concern significantly influences the green process and product innovation. For indirect effects, green product and process innovation mediate the relationship between management environmental concerns and green performance. This study contributes to the growing body of work on green innovation in several important ways addressing the gap in the literature and examining the causes of green innovation from the point of view of green performance in the hotel industry’s perspective.

Analyses in the fields of environmental and innovation research have hindered our understanding of the real effects of external drivers of firms' green innovation and sustainability behaviors on financial performance. This study compares the ways in which two different external factors drive firms to be green innovative: environmental regulation and market turbulence. By dividing green innovation into green process innovation and green product innovation, we propose that environmental regulation increases financial performance mainly through green process innovation rather than through green product innovation, and market turbulence affects financial performance mainly through green product innovation rather than through green process innovation. The results of an empirical analysis based on a mediation model and panel data on 472 Chinese listed firms for 2006–2017 lend support to our hypotheses. Our study contributes to the green innovation management and sustainability literature by offering a holistic framework for examining how firms pursue green innovation and sustainability in response to two different forms of external pressure.

The research aims to provide empirical evidence on the relationship of ESG and green innovation to company's business performance. The independent sample of this research is ESG was measuring ESG score. Dependent variables green innovation were measures using innovation of green product and innovation of green process. Sampling used in this research is purposive sampling technique. The sample of this research consisted of 66 manufacturing companies from 2016 to 2021. The data collected was analyzed using panel data regression analysis. This result shows that ESG positively influence business performance proxied by Tobin's Q and ROA unsupported. Green Innovation, which is proxied by green product innovation on the company's business performance, shows mixed results. Where green product innovation positively influence the company's business performance proxied by ROA. Conversely, green product innovation does not influence company's business performance proxied by Tobin's Q. Meanwhile, Green Innovation proxied by Green Process innovation effect on the company's business performance is not supported. Thus, it can be seen that ESG has not become a concern for investors in Indonesia, as evidenced by the limited number of public companies that disclose ESG scores. Green Innovation which is proxied by green product innovation and green process innovation shows mixed results which shows that customers are also considering purchasing products from companies whose innovations produce environmentally friendly products

The sudden outbreak and long-term trend of COVID-19 have brought huge attacks and uncertainty to the global economy, forcing countries to introduce various policies frequently to stimulate economic recovery. To realize sustainable development, firms established an environment-friendly economic development model by building a circular supply chain and implementing a green innovation strategy, which is expected to save resources and protect the environment by recycling resources. Based on this background, this study aims to determine the relationship between the uncertainty of economic policy, green innovation strategy, and circular supply chain performance. It divides green innovation strategies into green product innovation, green process innovation, green service innovation, and green logistics innovation to explore their different impacts on the performance of the circular supply chain. Simultaneously, the moderating effect of uncertainty of economic policy between green innovation and the performance of the circular supply chain is explored. Using survey data collected from 308 manufacturing firms in China, we empirically test the theoretical model and proposed hypotheses through the structural equation modeling approach. Our findings demonstrate that green product innovation, green process innovation, green logistics innovation, and green service innovation have a positive impact on the performance of the circular supply chain. Moreover, we also find that, contrary to our expectations, economic policy uncertainty plays a positive role in moderating the relationship between green innovation and circular supply chain performance. We believe that this paper has a clear contribution to the research on green innovation and circular supply chain management. This study provides a new perspective for the research on the integration of green innovation and circular supply chain, deepens firms’ understanding of green innovation strategy and circular supply chain, and provides important implications and guidance for manufacturing firms to better manage green innovation and circular supply chain practice as well as the risk of economic policy uncertainty.

Purpose Focused on Indonesia’s manufacturing sector, where SMEs dominate and environmental regulations evolve. This study examines how ambidextrous leadership drives sustainability performance through green innovation, addressing a critical gap in emerging economies. By integrating the Natural Resource-Based View, we reveal how leaders’ dual exploration-exploitation capabilities foster green product and process innovation, transforming environmental challenges into competitive advantages. Design/methodology/approach Using a robust quantitative analysis of 392 Indonesian manufacturing leaders, we demonstrate that ambidextrous leadership not only directly enhances sustainability performance (ß = 0.43, p < 0.001) but also indirectly through green product innovation (ß = 0.26, p < 0.001). Notably, green product innovation outperforms process innovation in this context, likely due to Indonesia’s growing consumer demand for eco-friendly goods. Findings These findings offer actionable insights for policymakers and business leaders, showing that targeted leadership training and green R&D incentives can accelerate progress toward Indonesia’s 2060 net-zero agenda. This study advances leadership theory by contextualizing ambidexterity in resource-constrained settings and redefining sustainability pathways for developing nations. Originality/value This study breaks new ground by integrating the Natural Resource-Based View with ambidextrous leadership theory, revealing how leaders in Indonesia’s manufacturing sector leverage green innovation to achieve sustainability. Unlike prior research focused on Western contexts, we uncover the critical mediating roles of green product and process innovation in an emerging economy, where SME dynamics and regulatory pressures shape outcomes. The findings offer a novel framework for policymakers, linking leadership training to Indonesia’s 2060 net-zero targets. This research redefines sustainability leadership in resource-constrained settings, providing actionable strategies for balancing exploration and exploitation in green transitions.

This paper argues that mechanisms such as information sharing and collaboration used in green supply chain integration (GSCI) to improve information processing capacity can reduce uncertain outcomes of green product and process innovation. Based on data from a survey of Chinese (Hong Kong) firms, the paper tests whether the three dimensions of GSCI (green internal, customer and supplier integration) improve environmental performance and cost reduction by facilitating green product and process innovation. The results show that green customer integration improves cost and environmental performance through green process innovation (not green product innovation). Both green product and process innovations are facilitated by green customer integration (not green supplier integration), while both green customer and supplier integration significantly depend on green internal integration. These suggest that the distinctive information processing capacity created by green internal and customer integration can facilitate the green process innovation required to improve environmental and cost efficiency, while green product innovation and green supplier integration cannot create such efficiencies.

Innovation in green technologies is a key factor propelling Jordanian sustainable development in the small and medium enterprises for achieving sustainability. Jordan is considered as a hub of small and medium enterprises, however, despite technological advancements and the efforts of the government, small and medium enterprises in Jordan are scarcely catering the aspect of green activities and researchers have paid less attention towards the same. Green product and green process innovation mode choices have drawn enough attention recently, but limited researchers have thoroughly examined the pathways through which green innovation is transmitted to small and medium enterprises’ performance. Green product and process innovation are the two main streams of green innovation that can enhance small and medium enterprises’ performance. The current research builds the framework for SMEs performance based on green product innovation and green process innovation following earlier research that have been conducted in the context of developed countries. It conducts an empirical analysis using responses of 384 manufacturing sector small and medium enterprises in Jordan. The findings demonstrate that small and medium enterprises can perform better when green products and processes are innovated. One significant moderating variable over the performance paths of small and medium enterprises is technological turbulence. The findings of the research contribute to a better understanding of green innovation and have implications for designing policies that promote green development.