The effect of green HRM practices on green competitive advantage of manufacturing firms

Abstract

PurposeThe rising public concern for the natural environment is compelling business entities to revise their business models toward green management. Most manufacturing firms have realized that green innovation is a critical factor that drives their success. However, green human resource scholars have overlooked this research line despite the potential contribution it can advance in green management scholarship. This paper empirically models the extent to which green innovation culture (GIC) moderates the relationship between green human resource management (GHRM) and green competitive advantage (GCA). The paper has two-fold objectives. First, to investigate the effects of GHRM and GIC on the firm's GCA and second, to model the extent to which GIC moderates the link between GHRM practices and GCA of manufacturing firms in Zhejiang Province of China.Design/methodology/approachData were collected from 324 Chinese employees from the manufacturing sector. The authors captured data from all levels of the organization. The authors made three models equations: two direct and one interactive. The authors then applied structural equation modeling (SEM) using AMOS 24 to test the study models and hypothesis.FindingsThe findings suggest that GHRM practices, which include recruitment and selection, training and development (green abilities); performance management and reward and compensation (green motivation); and employee involvement and leadership (green opportunities) have a significant positive effect on the firms GCA. The findings also indicate that firms that GIC, which include green product innovation (GPDI) and green process innovation (GPRI), promotes the firm's GCA. The paper further reveals that firms that combine GHRM and GIC attain higher GIC than those which practice GHRM only.Originality/valueThis paper draws a roadmap on how the top management in manufacturing firms can drive the firm's operations toward a higher GCA. It's the pioneer paper to suggest the combination of GHRM and GCI for enhanced GCA.