The Determinants of Green Innovations, Green Innovations, and Performance

Purpose Companies are facing internal and external pressure to accelerate the paradigm shift centered on low carbon and adapt and implement environmentally friendly business activities. According to this trend, it is becoming important for companies to actively promote the adoption and implementation of environmentally friendly activities such as green innovation. This paper aims to develop a model that verifies the determinants supporting green innovation and the impact of green innovation on performance. Methodology A research model was designed based on previous studies and theories, and a questionnaire survey was conducted on manufacturing companies to verify this. 96 samples of the questionnaire were used for the final analysis, and the hypothesis was verified using PLS－SEM. Findings It was found that corporate environmental ethics and market demand have a direct positive effect on both green product innovation and green process innovation. It was found that stakeholder interest had a positive effect on green process innovation, and management commitment had a positive effect on green product innovation. It was found that green product innovation had a positive effect on environmental and organizational performance. Environmental performance was found to have a positive effect on organizational performance. This supports the ‘Win－Win’ paradigm of environmental efficiency that improvement of environmental performance has a significant effect on organizational performance. Implications Green innovation is driven by corporate environmental ethics, market demand for green products, stakeholder interest, and management commitment. It suggests that participating in environmental business practices such as green innovation can help improve environmental and organizational performance.