Performance effects of green production capability and technology in manufacturing firms

Abstract

The proclamation of the sustainable development goals is driving companies to implement protective measures that favour the environment, thereby occupying a strategic place in the creation of green product innovation (GPI). This new management paradigm could be impacting capabilities, techniques, technologies, efficient energy use and green-oriented production policies and systems. Therefore, one of the challenges is to configure green production capabilities (GPC) coordinated with the technology dimension (TECH) because the design of ecological products and their manufacture requires the backup of capabilities and the possible support of green technology. To this effect, this article aims to establish the impact of the association of GPC and TECH on organisational performance. To do so, we test whether the adoption and high implementation of GPC and TECH affect environmental and financial performance. Empirical evidence is supported by the European Manufacturing Survey (EMS), using a sample of 1018 manufacturing companies from seven European countries. Our results show that the adoption of GPC and TECH and their high levels of implementation have a significant impact on environmental and financial performance. Regarding the association between the implementation of GPC and TECH, its contribution to environmental performance but not financial performance is evidenced. Furthermore, at high levels of implementation of this association, there is no significant effect on either environmental or financial performance. These findings drive theoretical and practical implications and provide opportunities for academics, managers and government bodies