The role of technological innovation in responding to environmental concerns

Abstract

ABSTRACT This study empirically examines the impact of stakeholder pressure and concerns about public image on the use of technological innovations i.e. the use of innovations in environmental products and processes, and the subsequent impact on environmental and financial performance. Data were collected by mail survey from a random sample of 577 chief financial officers in Australian manufacturing organisations. The results show that pressures from stakeholders have a direct association with the use of innovations in environmental processes, and an indirect association with environmental and financial performance due to the subsequent association of the use of innovations in environmental processes on these outcomes. Public image is directly associated with the use of innovations in both environmental products and processes, and indirectly associated with environmental and financial performance due to the subsequent association between the use of innovations in environmental processes with these outcomes. The findings provide managers with an insight into the importance of improving environmental processes to enhance both environmental and financial performance, and how pressures from stakeholders to consider environmental issues and concerns about public image promote the enhancement of technological innovation.