Green technology innovation and waste management: On the role of national governance

Abstract

Due to the rapidly escalating ecological crisis and proactive measures by national governments to combat climate change, corporate environmental systems and green technologies have gained increasing attention among organizational stakeholders. Corporations with higher levels of waste production are under tremendous stakeholder pressure to invest in green technologies and develop eco-friendly products and services. In this regard, national governments play a critical role in shaping corporate environmental orientation and sustainable practices. However, empirical research examining the relationships among green technology innovation (GTINV), waste management (WM), and national governance (NLGOV) is still limited. Thus, using an extensive international dataset from 46 countries between 2002 and 2022, we examine the relationship between GTINV and WM practices and investigate the moderating role of NLGOV. Accordingly, our study extends the existing literature by providing more nuanced evidence on whether and how GTINV leads to better environmental performance. Our results show that GTINV significantly reduces waste production and enhances recycling efforts. Most importantly, these effects are more pronounced for firms from countries with effective NLGOV systems. Our findings advise practitioners, policymakers, and regulators to combat climate change, especially in jurisdictions with weak institutional settings, by promoting proactive WM systems, implementing green technology innovations, and adopting effective environmental regulations.