The Role of Green Innovation Performance in Mediating the Influence of Green Organizational Culture on Green Competitive Advantage

Abstract

Purpose - A society that cares about environmentally friendly products demands companies have a green competitive advantage through the application of the principles of Reuse, Reduce, and Recycle. The purpose of this research is to examine and analyze the influence of green organizational culture (GOC) on green innovation performance (GIP) and green competitive advantage (GCA). Design/Methodology/Approach - The study collected data from 314 manufacturing companies that are members of Proper (Environmental Performance Rating Program) on Java Island. Data collection was conducted through online and offline surveys using questionnaires that measured each research variable. Structural equation modelling with SEM PLS software were applied to analyze the data. Findings - The findings of this paper indicate that green organizational culture has a positive influence on green innovation performance. GOC also positively influences GCA, and GIP fully mediates the relationship between GOC and GCA. Research Implications - This research contributes to existing literature on GOC, GIP, and GCA, taking into account environmental issues, which have been empirically understudied, especially in manufacturing companies that are members of Proper. Furthermore, this research also explores green innovation performance as a mediator, which has been relatively unexplored in previous studies. However, this research has several limitations, including the dominance of blue-rated Proper participant companies in the sample, as most questionnaires were distributed during the blue certificate awarding moments. Additionally, the sample size per province was uneven, with the majority of participant companies located in the province of West Java.