Adoption Of Environmental Innovations Research Articles

Strategic Dimensions of Eco-Innovation Adoption in Manufacturing SMEs in the Context of Mexico City

This paper investigates the strategic dimensions influencing the adoption of environmental innovations (EIs) in small and medium-sized manufacturing enterprises (SMEs) in Mexico City. The study aims to understand the fundamental strategic dimensions defining eco-innovation and examine how SMEs manage the complexities of incorporating these practices. Employing a mixed-methods approach with documentary analysis and expert interviews, the study identifies key factors influencing EI adoption through causal maps and the viable system model. Findings highlight the significance of external and internal factors such as competitive pressure, economic constraints, technological capabilities, political support, and social influence. This integrative approach emphasizes the importance of adaptability and responsiveness, presenting eco-innovation as a source of sustainable competitive advantage for SMEs.

Employment of the DCC-GARCH Copula Model to explore a link between robotics and artificial intelligence and green crypto investments.

The pursuit of the Sustainable Development Goals (SDGs) requires considerable new green crypto investments. To attract the flow of this investment, it is necessary to develop and apply robotic artificial intelligence (AI) as it has the potential to encourage the adoption of environmental innovation and increase individuals' environmental awareness. Our research employs the DCC-GARCH Copula Model to examine time-varying spillovers and prove interlinkages between the development of AI and green cryptocurrencies in the period from January 1, 2018, to September 8, 2023. Comparing the optimum hedge ratios with the optimal portfolio weights, we demonstrate that the optimal hedge strategy for BOTZ is the most successful one. However, the success of hedging depends on the portfolio's risk profile. Based on our analysis of the cumulative profit profile of different approaches, we continue to believe that the best portfolio weighting strategy is the one that produces positive returns in the middle of 2020 and the first part of 2022 and 2023. This demonstrates that the most profitable diversification approach is not always the most successful one. Our results have important policy implications for investors and governments.

How effective are green innovations as a remedy for mineral resource scarcity in the European region?

The relationship between environmental externalities and green innovation is being increasingly explored in the literature but there is no paper exploring the nexus between green innovation (GI) and sustainable development. This article sheds light on the connection between GI and mineral rents from 2007 to 2021. In order to verify our results, we conduct a robustness assessment using a variety of natural resource rents, encompassing coal rents, gas rents, and forest rents. Our research furnishes evidence indicating that the adoption of environmental innovation is poised to curtail the consumption of most mineral resources, with the exception of forest rents in the PCSE and FGLS estimates. While GI does not exhibit statistical significance in the short term, its long-term impact reduce reliance on mineral rents. These findings maintain their robustness and reliability when accounting for endogeneity, fixed effects, and heterogeneity. To illuminate the relationship between institutional quality and mineral rents (MR), we incorporate six different indicators of institutions: voice and accountability (VA), government effectiveness (GE), rule of law (RL), regulatory quality (RQ), political stability and absence of violence/terrorism (PV), and control of corruption (CC). Our findings underscore the fact that integrating GI with institutions diminishes activities associated with mineral rents; from this we provide important policy recommendations for promoting GI development to use mineral resources more efficiently.

Green relational capital, integration capabilities and environmental innovation adoption: The moderating role of normative pressures

AbstractEnvironmental innovation has received increasing attention recently among scholars and policy‐makers. Drawing on diffusion of innovation theory, social capital theory, dynamic capabilities theory and institutional theory, we propose that green relational capital positively influences firms' environmental innovation adoption activities. This research used survey data from 392 manufacturing firms in China. The results show that green relational capital produces a positive influence on both the speed and comprehensiveness of environmental innovation adoption, and this effect is mediated by firms' integration capabilities. Moreover, normative pressures positively moderate the relationship between green relational capital and integration capabilities.

The drivers of eco‐innovations in small and medium‐sized enterprises: A systematic literature review and research directions

AbstractThe debate on innovations that contributes to the decoupling of economic growth and environmental degradation or fosters the transition from the brown to the green economy is becoming increasingly relevant in the academic and business worlds, fuelling a research stream that is proving very interesting for its economic, environmental and social implications. Although the debate on the adoption of environmental innovations is well underway, the discussion on eco‐innovation in the context of small‐ and medium‐sized enterprises (SMEs) is at a less developed stage and deserves more attention, especially given the relevance of these companies in the economic system of several countries. Thus, this study proposes a systematic literature review of the determinants of eco‐innovation in SMEs and explores the relationships among them by starting from the criticalities highlighted in the five literature reviews of determinants of eco‐innovations in SMEs that have been recently published. The first step of the research concerns a detailed description of the selection process of the articles under consideration and of their characteristics. In the second step, 14 main categories of determinants are identified. Additionally, in the third step, as result of this investigation, three basilar research directions and 13 related research questions emerged.

Closing the loop through eco‐innovation by European firms: Circular economy for sustainable development

AbstractThe purpose of this paper is to analyze the factors influencing the adoption of environmental innovations towards a circular economy (CE) by the EU firms, with special focus on technological capabilities and external support. A multivariate probit model is specified to allow the distinction between three types of eco‐innovative practices: Reduce, Recycle, and Redesign technological processes. Using a novel taxonomy based upon the distinction between narrowing, closing, and slowing loops in the use of resources, we find that financial and technological capabilities are essential drivers for all types of CE actions in the European firms. Similar findings are found for the public funding support but only when the firms are recycling (closing resource loops) and redesigning (slowing resource loops). Knowledge from private companies (pecuniary mode) is relevant to Reduce and Recycle strategies. These two eco‐innovative practices are also shown in firms with a wide external knowledge network. Results also show that there is an inverted U‐shaped relation between the diversity of collaboration and the circular Redesign of products. The paper ends up with some implications for practitioners and policy makers.

Analyzing the impact of COVID-19 on environmental innovations in manufacturing firms

COVID-19 has had a significant impact on the manufacturing industry, and manufacturers have responded to the crisis in different ways. This study investigates Norwegian manufacturers’ response to the crisis, particularly how it has influenced their adoption of environmental innovations. More specifically, the study investigates whether firms choose “general” or “green” strategic responses to the crisis and how this influences the overall adoption of environmental innovations. In addition, the study investigates how the degree of environmental innovation adoption occurring before COVID-19 affects how the crisis impacted firms. The study adopts a quantitative research approach using survey data from 526 manufacturing firms—a representative sample of manufacturers in Norway. The findings reveal that those manufacturers the most environmentally innovative before COVID-19 were more impacted by the crisis. Moreover, firms adopted both general and green responses to the crisis, and the overall conduction of environmental innovations decreased during the pandemic. The main contribution is the empirical findings related to the overall impact of COVID-19 on sustainability-oriented manufacturing. The implications are discussed for both theory and practice.

Transactions Involving Electric Vehicles for Green Technology

This study focuses on using consumer motivation to encourage the adoption of cleaner technologies. Consumers are varied since they may be driven by internal or external reasons. Though information provision methods may be helpful in encouraging some consumers to purchase electric vehicles. Also, financial incentive schemes such as discounts or penalties may be more persuasive to extrinsically driven customers. This article offers a sophisticated theory of environmental innovation adoption in which information-provision methods are complemented with economic incentives. The different studies have been done to find out the policies for encouraging customers to reduce the harmful impacts of transportation system on environment. The projection of electric cars sales by 2030 is examined. Finally, the different reasons fueling development of electric cars are explored in depth. The results of this study would be of particular relevance to legislators who seek to push consumers toward greener technologies.

Stepping up to the mark? Firms’ export activity and environmental innovation in 14 European countries

ABSTRACT We investigate the ability of exports to trigger the adoption of environmental innovation (EI) in firms, shedding light on the determinants of convergence in environmental standards for Europe’s catch-up economies. To analyse this question empirically, we measure the latter as the 1) probability a firm adopts EI and the 2) breadth of EI adoption in firms. Applying Logit and Poisson pseudo-maximum likelihood estimations to firm-level data for 14 European countries, we find that particularly Eastern European exporters report higher EI adoption propensities, an effect exclusively driven by process-based EI and not observable for product-based EI. Additionally, we reveal that regardless of a firm’s origin, exposure to importing countries with high market-related environmental policy stringency, is linked to the adoption of EI. We conclude that learning-by-exporting, regulation-push and demand-pull mechanisms may help to explain these findings, with foreign markets being characterised by a wider diversity of stakeholder preferences.

Effects of R&D, networking and leadership roles on environmental innovation adoption in Vietnam’s SMEs

Although small and medium-sized enterprises (SMEs) constitute a majority of firms, they still have little knowledge about environmental issues and generally encounter difficulties when integrating environmental aspects into their activities. Similar arguments are also highlighted by Ha et al. in the case of Vietnam. This paper, therefore, builds a guideline for promoting SMEs’ organisational environmental innovation adoption based on Environmental Standard Certification (ESC) by investigating the effects of R&D, networking, and leadership roles in Vietnam. By using SME survey data in Vietnam from 2011 to 2015, the empirical results show that R&D spending and organisational capabilities proxied by already owning ESC are positively associated with green innovation implementation. We also find that either collaboration with different partners, including competitors, banks, and public agents or communication networks, affects firms’ decisions on green innovations. The demographic characteristics of managers such as gender, educational level, and knowledge about the environmental laws play determining roles in these decisions. Finally, we advanced the literature by indicating the moderating effects of men in leadership roles and leaders with better related knowledge on the impacts of firms’ internal resources (R&D) and firms’ international orientation (export).

Effects of Bribery on Firms' Environmental Innovation Adoption in Vietnam: Mediating Roles of Firms' Bargaining Power and Credit and Institutional Constraints

This paper uses survey data of small and medium-sized enterprises (SMEs) in Vietnam, from 2011 to 2015, to examine the effects of bribery on environmental innovation decisions by firms, accounting for the roles of bargaining power and/or credit and institutional constraints. In the study, bribery activities are categorized into greasing and rent-seeking forms. Self-assessment of firms on the uncertainty of government policies and the competition environment is used to capture institutional constraints, while firm size and legal registration status are used to represent bargaining power. The group of credit-constrained firms is further broken down into those that have demand for more loans and those not currently looking for a loan application. Our empirical results provide evidence that greasing bribery has a positive effect on firms' decisions about implementation of environmental innovation (the “greasing-the-wheels” hypothesis) while there is no impact from rent-seeking bribery. The positive effect of greasing bribery is particularly sizable for large, formally registered firms, or those facing no credit constraints, while specific types of institutional constraints that firms perceive as obstacles to their growth also affect the magnitude of the impact. Lastly, when endogeneity is controlled, the effect of greasing bribery becomes more pronounced and there is evidence on the “sanding-the-wheels” hypothesis of rent-seeking bribery.

Determinants of environmental innovations supporting small‐ and medium‐sized enterprises sustainable development

AbstractEnterprises are increasingly required to improve their environmental performances. The adoption of environmental innovations (EIs) is believed a way to achieve this goal. So a flourishing debate about the determinants supporting investment in EIs arose. Researchers have thus far paid attention mainly to established manufacturing firms operating in traditional sectors. Hence, scientific literature recommends deepening the behavior of small‐ and medium‐sized enterprises (SMEs) because of the role they play in the productive systems in many Western countries. With this in mind, this study investigates a probabilistic sample of 222 innovative SMEs using the partial least squares and importance–performance map analysis in order to identify the factors affecting their propensity to invest in EIs. Findings show that the propensity results are affected by the firms' environmental awareness, company staff, and capabilities, among the internal factors, whereas among the external ones, the propensity is affected by norms and regulations. An important role is also played by the hope to improve their economic and environmental performances. Monetary and fiscal incentives reveal not to be significant. Consequently, policies should firstly propose an appropriate mix of regulations and stimuli following two directions: a compliance direction to more stringent regulations and rules to be followed through the imposition of penalties and a cultural direction aiming at improving environmental awareness of SMEs about the desirability of pursuing EIs for both ethical and economic reasons, given the potential benefits associated with such innovations.

Environmental innovation in the RF Arctic Zone regions as a tool to realize the demographic potential

Subject. This article discusses the issues of balanced development of regions, the Man-Environment system, and the introduction of environmental innovation in technological processes. Objectives. The article aims to analyze the adoption of environmental innovation in terms of realizing the demographic potential of the Arctic regions of Russia. Methods. For the study, we used a content analysis, statistical data qualitative and cause-and-effect analyses, grouping, and systematization. Results. Most regions of the Arctic show significant levels of environmental impact, including atmospheric air, surface water and land. There is a high disease incidence of the population in the Arctic areas. The proportion of companies implementing environmental innovation in technological processes is negligible. Conclusions. The article concludes that it is appropriate to accelerate the pace of environmental innovation in economic activity. This will help reduce pollution and have a positive impact on public health.

Sustainability Transitions in Baltic Sea Shipping: Exploring the Responses of Firms to Regulatory Changes

This study investigates how the introduction of more stringent environmental regulation regarding sulphur and nitrogen emission control areas induced shipping companies to react to a new situation and opened up a window of opportunity for build-up of niches for alternative vessel energy sources. By drawing on a multi-level perspective from the socio-technical transition literature, the study provides empirical evidence for how realignments in the environmental regulatory regime alter incumbent actors’ positions and produce varying environmental innovation responses to reduce air-borne pollution from shipping. The study illustrates that the stringency of a regional command-and-control regulation in combination with evolving pressures in the external landscape environment and shipping companies’ task environments are essential components shaping the adoption of environmental innovations. Although incremental innovations seem to dominate in a fossil fuel-based maritime transportation socio-technical system, our results demonstrate the role of regulations and the behaviour of frontrunners in the context of regime fragmentation and sustainability transition processes.

Content analysis of China’s environmental policy instruments on promoting firms’ environmental innovation

Environmental policy instruments play an important role in promoting environmental innovation. They can not only solve the problem of externalities in environmental innovation, but also provide support for its development through subsidies, tax incentives, etc. This study constructs an analytical framework from the dimensions of policy type and policy targets of two stages of environmental innovation, and selects 231 environmental policies issued by the Chinese government as well as various ministries and commissions from 1987 to 2016 to promote environmental innovation as the research sample. The results show that the issue of environmental policy is mainly in the form of notification and lacks of authority. The use of market-based instruments is more frequent than that of command-control and information-based instruments. Environmental policy instruments focus on environmental innovation adoption rather than environmental innovation research and development; the use of government procurement, information disclosure and other policy measures are relatively inadequate.

Dynamic capability matters: Uncovering its fundamental role in decision making of environmental innovation

This study aims to explore organizations’ intrinsic drivers of voluntarily adopting environmental innovations that are in early stage of diffusion. In particular, it investigates the vital role of dynamic capabilities in the decision-making process of adoption. Adopting a process-oriented model, this study focuses on the initiation (instead of implementation) process of innovation adoption and examines how dynamic capabilities can result in intention of adopting environmental innovation voluntarily. The findings show that dynamic capabilities have positive effects on organizational intention of adoption not only directly, but also indirectly through facilitating managers to interpret environmental innovations as an opportunity, rather than a threat. Furthermore, this partial mediating role of managerial interpretation between dynamic capabilities and environmental innovation adoption varies depending on organizational social position. Compared to central firms, peripheral firms tend to be more responsive to managerial interpretation. The chain from dynamic capabilities, to interpretation of environmental innovation as an opportunity, and finally to the intention of adoption is stronger for peripheral firms than for central ones.

Demand-pull and environmental innovations: Estimating the effects of innovative public procurement

This paper contributes to the emerging literature on the adoption of environmental innovation, by investigating the so far unexplored role of governmental demand in stimulating ‘greener’ production choices. Specifically, the role of innovative public procurement in driving the adoption and diffusion of sustainable manufacturing technologies is analysed. Results, based on firm-level data in the 28 Member States of the European Union, Switzerland and the USA, are obtained through non-parametric matching techniques. Those outline the crucial role of innovative public procurement in the uptake of environmental innovations. This confirms the relevance of such policy instrument in allowing countries to achieve a decarbonised and sustainable growth path which is compatible with competitiveness goals.

Financial barriers and environmental innovations: evidence from EU manufacturing firms

We analyse the role of financial barriers in affecting the adoption of environmental innovations (EI) with a focus on manufacturing small and medium-sized enterprises in Europe. In taking stock of the consolidated literature on EI, we find that the role of financial barriers is substantially neglected, although crucial, even more relevant in the current phase of the economic cycle. Our empirical analysis confirms the existence of direct negative effects of financial barriers on environmental innovation investment decisions. It furthermore sheds more light on the determinants of financial barriers that shape firms’ cleaner production choices. Our findings have the following policy implications: properly designed policies can play a critical role, not only by stimulating EI through their determinants, but also by acting on the financial obstacles to eco-innovation.Policy relevanceEnvironmental innovations (EI) are essential to achieve economic growth and environmental protection goals. Technological development is one of the key factors that can counterbalance the growth and population emission-augmenting effects. EI are a priority in major EU policy strategies and a prerequisite for the development of a ‘Resource efficient Europe’, one of the flagship initiatives of Europe 2020. The existence of financial barriers can constitute a serious deterrent for the eco-innovative capacity of firms, even more than for ‘traditional’ innovations, as EI are characterized by high technical risk, long payback period and uncertainty on the appropriability of private rents. This article analyses in depth whether barriers related to external financing affect EI investments and whether the stringency of financial constraints to investments in EI is affected by factors related to EI specificities. We show that when both direct and indirect effects on EI investments are considered, the role of the policy framework appears to be as particularly crucial in order to reverse the risk/return trade-off of eco-innovative investments. Targeting policy interventions to facilitate access to credit and to mitigate capital markets’ imperfections is essential to mitigate the apparent contradiction between EU industrial policies and climate abatement scenarios.

Towards a green economy through innovations: The role of trade union involvement

In this paper, we address the overlooked issue of whether and how industrial relations might play a role in the process of greening the economy, primarily through the levers of innovation adoption and organisational change. We address our objective econometrically, assessing the quality of industrial relations as a driver of environmental innovation adoption, through the use of micro-data on manufacturing firms. The results yield two interesting main findings: being a unionised firm is not associated with the adoption of environmental innovation; however, when we consider the industrial relations climate, we observe a positive relationship between a cooperative industrial relations climate (union involvement) and the propensity to introduce environmental innovation. Two models are relevant: a managerially oriented model (unions are informed) and a participatory model (unions bargain on innovation adoption). The contents of environmental innovations are also important: union involvement is more relevant for adopting more complex and radical innovations to abate CO2 and EMS and ISO practices.

Are regional systems greening the economy? Local spillovers, green innovations and firms’ economic performances

ABSTRACTThe adoption and diffusion of environmental innovations (EIs) is crucial to greening the economy and achieving win–win environmental/economic gains. A large and increasing literature has focused on the levers underlying EIs that are external to the firm, such as stakeholder and policy pressures. Little attention, however, has been devoted to the possible role of local spillovers of a sector/geographical nature as a factor that correlates with EIs and economic performances. A rich data set that covers the innovative activities and economic performances of firms in the Emilia-Romagna region in Italy, an area dense in manufacturing districts, is analysed. EIs’ drivers and effects on firms’ performance are investigated through a two-step procedure. First, we examine the relevance of spatial levers, namely, whether high rates of eco-innovators in a given local area induce the adoption of EIs in firms located in the same local area. The role of the ‘agglomeration lever’ turns out to be fairly local in nature: we find that spillovers are significantly inducing innovation within municipal boundaries. Second, we test whether EIs adoptions have significantly increased firms’ economic performances and find that some firms’ productivity performances are positively related to EI adoption.