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How Does Regional Cultural Diversity Drive Firms' Environmental Innovation? The Role of Strategic Alliances and Knowledge Base

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  • Zhongju Liao
  • Mengnan Zhang
  • Yangyan Shi

Abstract

Culture significantly influences corporate strategic behavior and performance. Based on institutional theory and resource‐based perspective, this study constructs a relational model integrating regional cultural diversity and firms' strategic alliances, knowledge base, and environmental innovation. Using 1081 Shanghai and Shenzhen A‐Shares listed firms (2012–2022) as samples, it conducts multiple regression analysis to examine the effect of regional cultural diversity on firms' environmental innovation, the mediating role of strategic alliances, and the moderating role of the knowledge base. Findings show that regional cultural diversity positively affects firms' environmental innovation, which is mediated by strategic alliances. It also shows that this effect is positively moderated by the breadth of the knowledge base but negatively moderated by the depth of the knowledge base. These findings suggest promoting the protection and integration of regional cultural diversity and accelerating the formation of corporate strategic alliances to enhance firms' environmental innovation capabilities.

Suggested Citation

  • Zhongju Liao & Mengnan Zhang & Yangyan Shi, 2026. "How Does Regional Cultural Diversity Drive Firms' Environmental Innovation? The Role of Strategic Alliances and Knowledge Base," Business Strategy and the Environment, Wiley Blackwell, vol. 35(5), pages 6715-6727, July.
    • Handle: RePEc:bla:bstrat:v:35:y:2026:i:5:p:6715-6727
    DOI: 10.1002/bse.70514
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