The Effect of Environmental Orientation on Green Innovation: Do Political Ties Matter?

Hui Li,Yongtao Song,Wenwen Zhao,Liwei Feng

doi:10.3390/su10124674

Abstract

Although the importance of environmental orientation has been recognized, how and under what conditions it influences green innovation is limited. To extend the research on green innovation, our research examines the impacts of two dimensions of environmental orientation on two types of green innovation, as well as the moderating role of political ties. Drawing upon stakeholder theory and resource-based view, we propose research hypotheses. We perform hierarchical regression analysis to validate the hypotheses that is based on survey data collected in 253 Chinese manufacturing companies. Our findings indicate that internal environmental orientation and external environmental orientation are positively linked with both green product innovation and green process innovation. The effect of internal environmental orientation on green process innovation is stronger than that of green product innovation. In addition, political ties strengthen the positive impacts of internal environmental orientation on green product innovation and green process innovation, while attenuating the positive impact of external environmental orientation on green process innovation. These findings contribute to theory and practice by enriching our understanding of how two dimensions of environmental orientation affect two types of green innovation.

Highlights

Since the increasing environmental pressures from different stakeholders, firms should maintain their products/services and operations to be environment-friendly [1,2,3]
Resource-based view (RBV) and stakeholder theory suggest different moderating effects of political ties in the environmental orientation-green innovation link. By combining these two theories, we suggest that political ties strengthen the importance of internal environmental orientation as it enhances firms’ capabilities of gain resources, while political ties reduce the importance of external environmental orientation, since firms that heavily depend on the government may engage in more political-related activities to address external stakeholders’ environmental concerns [8]
Environmental orientation is critical for firms to promote green innovation [21,22]

Summary

Introduction

Since the increasing environmental pressures from different stakeholders, firms should maintain their products/services and operations to be environment-friendly [1,2,3]. A growing number of firms are considering green innovation to be a critical approach to reduce their negative impacts on natural environment [7,8,9,10,11]. Chang suggested that green innovation is critical for a firm to gain competitive advantage [7]. Li et al [10] and Albort-Morant et al [11] indicated that firms need to improve green innovation performance when facing pressures from various stakeholders. There is need to investigate how to promote green innovation

Methods

Results

Conclusion