How CSR and Green Innovation Boost Environmental and Financial Performance

What is it about?

The study investigates the interplay between corporate social responsibility (CSR), environmental and financial performance, considering the mediating role of sustainable development and green innovation, and the moderating impact of green innovation strategies and actions. Data from 497 employees in Pakistan's manufacturing sector were analyzed using structural analysis, revealing that CSR positively influences environmental and financial performance, with sustainable development and green innovation serving as mediators. Green innovation strategies and actions further moderate these relationships. The findings underscore the importance of CSR in boosting firms' environmental and financial performance through sustainable development and innovation, providing valuable insights for stakeholders in developing economies. The study validates the reliability and validity of its measurement model and aligns with existing literature on the benefits of CSR in fostering sustainable development and innovation.

Featured Image

Photo by Dmitrii Eliuseev on Unsplash

Photo by Dmitrii Eliuseev on Unsplash

Why is it important?

This research is crucial because it advances the understanding of how corporate social responsibility (CSR) can positively impact both environmental and financial performance, specifically in the manufacturing sector of developing countries like Pakistan. By exploring the mediating effects of sustainable development and green innovation, as well as the moderating effects of green innovation actions and strategies, the study provides a comprehensive model that illustrates the interconnectedness of CSR activities, environmental well-being, and financial success. This is especially relevant in the context of rising environmental concerns and the need for sustainable business practices, making it valuable for managers, entrepreneurs, policymakers, and other stakeholders who seek to harmonize economic and ecological goals. Key Takeaways: - CSR's Positive Influence: Corporate social responsibility towards the environment, employees, community, and consumers significantly enhances both environmental and financial performance in manufacturing firms. - Mediating and Moderating Factors: Environmental sustainable development and green innovation serve as mediators, while green innovation strategies and actions act as moderators in the relationship between CSR and firm performance, highlighting the importance of integrating these elements into business strategies. - Strategic Importance for Stakeholders: The findings underscore the importance of CSR for sustainable development, urging stakeholders to adopt CSR practices to achieve a balance between ecological and financial outcomes, thereby promoting the overall prosperity of the firm's ecosystem.