Quantitative analysis reveals that green innovation and supply chain management improve environmental performance, indicating important sustainability practices.
In facing global challenges related to sustainability and environmental issues, the furniture industry needs to implement environmentally friendly business strategies to increase efficiency and reduce negative environmental impacts. This study aims to analyze the effect of Green Innovation, Green Intellectual Capital, and Green Supply Chain Management on Environmental Performance in the furniture industry in Jepara. The method used is quantitative with the Structural Equation Modeling (SEM) approach based on Partial Least Squares (PLS) involving 130 furniture business actors who have been operating for at least two years using a purposive sampling strategy. The results of the study illustrate that Green Innovation and Green Supply Chain Management have a positive and significant effect on Environmental Performance, reflecting the important role of innovation and sustainable supply chain practices in increasing energy efficiency and reducing waste. In contrast, Green Intellectual Capital does not have a significant effect, which is thought to be due to the lack of optimization and limited green technology. These findings have implications for industry players and policy makers to strengthen green innovation and environmentally-based supply chain management to increase competitiveness and contribute to more sustainable economic and ecological development.
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Rochman et al. (2025) studied this question.
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