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Environmental Innovation, Environmental Performance and Financial Performance: Evidence from Malaysian Environmental Proactive Firms

Author

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  • Tze San Ong

    (Department of Accounting and Finance, Faculty of Economics and Management, Universiti Putra Malaysia, UPM Serdang, Selangor 43400, Malaysia)

  • Ah Suat Lee

    (Department of Commerce and Accountancy, Universiti Tunku Abdul Rahman, Kampar 31900, Malaysia)

  • Boon Heng Teh

    (Faculty of Management, Multimedia University, Cyberjaya 63100, Malaysia)

  • Hussain Bakhsh Magsi

    (Faculty of Management and Social Science, Water and Marine Sciences, Lasbela University of Agriculture, Uthal, Balochistan 90150, Pakistan)

Abstract

This study is aimed to investigate the relationship between environmental performance, environmental innovation, and financial performance of firms. A total of 124 responses were collected from managers of manufacturers certified by ISO 14001 EMS in Malaysia, and the data was subjected to a structural equation analysis using the Smart PLS version 3.2.7 software. The results have endorsed environmental competitive capabilities i.e. environmental innovation and environmental performance as the key enablers for the creation of economic values for environmental proactive manufacturing firms. Moreover, environmental innovation is also found to be the mediator that transforms the benefits of environmental performance into financial performance.

Suggested Citation

  • Tze San Ong & Ah Suat Lee & Boon Heng Teh & Hussain Bakhsh Magsi, 2019. "Environmental Innovation, Environmental Performance and Financial Performance: Evidence from Malaysian Environmental Proactive Firms," Sustainability, MDPI, vol. 11(12), pages 1-18, June.
    • Handle: RePEc:gam:jsusta:v:11:y:2019:i:12:p:3494-:d:242908
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