GEO and sustainable performance: the moderating role of GTD and environmental consciousness
| DOI | https://doi.org/10.1108/JIC-10-2021-0290 |
| Published date | 28 June 2022 |
| Date | 28 June 2022 |
| Pages | 38-67 |
| Subject Matter | Information & knowledge management,Knowledge management,HR & organizational behaviour,Organizational structure/dynamics,Accounting & finance,Accounting/accountancy,Behavioural accounting |
| Author | Ong Tze San,Badar Latif,Assunta Di Vaio |
GEO and sustainable performance:
the moderating role of GTD and
environmental consciousness
Ong Tze San
School of Business and Economics, Universiti Putra Malaysia,
Serdang, Malaysia and
Department of Business Administration, Daffodil International University,
Dhaka, Bangladesh
Badar Latif
School of Business and Economics, Universiti Putra Malaysia,
Serdang, Malaysia, and
Assunta Di Vaio
Department of Law, University of Naples “Parthenope”, Naples, Italy
Abstract
Purpose –Congruent with the world-wide call to combat global warming concerns and advance intellectual
capital (IC), organisations are being pressured to ensure that IC is managed effectively to encourage green
initiatives. In this regard, green entrepreneurial orientation (GEO) is emerged as a relevant IC. GEO is
recognised as a mitigating factor of environmental degradation in the literature. Although prior literature has
observed the nexus between GEO and firm performance, the role of GEO in leveraging sustainable
performance has been limitedly explored. This study explored the relationship between IC as a GEO and
enterprises’sustainable performance through the moderating roles of environmental consciousness and green
technology dynamism (GTD) in the context of two developing countries (Pakistan and Malaysia).
Design/methodology/approach –Data provided by 296 respondents from 264 manufacturing small and
medium-sized enterprises (SMEs) in Pakistan and Malaysia were analysed through a three-wave research
design. AMOS 23 software was used to perform covariance-based structural equation modelling (CB-SEM),
while hierarchical regression analysis was applied using the SPSS 25 software to examine the causal
relationships in the model.
Findings –IC as a GEO significantly influences su stainable performance, akin to environmenta l
consciousness and GTD. Besides, GTD has a significant moderating effect between GEO and financial and
environmental performance in Pakistan and Malaysia but not between GEO and social performance.
Environmental consciousness has a significant moderating role in the impact of GEO on financial performance
in Pakistan and Malaysia, but not on social and environmental performance.
Practical implications –The study’s findings are useful for managers of Pakistani and Malaysian
manufacturing SMEs to identify ways to encourage GEO to improve sustainable performance in their firms.
The findings suggest that managers should effectively implement GTD and environmental consciousness to
strengthen the GEO and sustainable performance relationship. Managers can use GEO concretely as a
reference for the companies that intend to support the United Nation SDG-2030 agenda and to find new
business opportunities for the implementation of sustainable development.
Originality/value –To the best of the authors’knowledge, this study is the first to examine the link between
GEO and sustainable performance in developing countries such as Pakistan and Malaysia. Although the
JIC
23,7
38
© Ong Tze San, Badar Latif and Assunta Di Vaio. Published by Emerald Publishing Limited. This
article is published under the Creative Commons Attribution (CC BY 4.0) licence. Anyone may
reproduce, distribute, translate and create derivative works of this article (for both commercial and non-
commercial purposes), subject to full attribution to the original publication and authors. The full terms of
this licence may be seen at http://creativecommons.org/licences/by/4.0/legalcode
The authors would like to thank the Editor-in-Chief and anonymous referees for providing helpful
comments and suggestions, which led to improving the article.
Funding: This work was funded by University of Naples “Parthenope”, Italy.
The current issue and full text archive of this journal is available on Emerald Insight at:
https://www.emerald.com/insight/1469-1930.htm
Received 2 November 2021
Revised 28 February 2022
15 April 2022
Accepted 7 June 2022
Journal of Intellectual Capital
Vol. 23 No. 7, 2022
pp. 38-67
Emerald Publishing Limited
1469-1930
DOI 10.1108/JIC-10-2021-0290
influence of various intangible assets or IC on sustainable performance has been widely examined in the
literature, the role of GEO as IC has been limitedly explored. This study extends the literature by adding to the
knowledge of GEO as a form of firms’IC that enhances boundary conditions in developing countries.
Keywords Intellectual capital (IC), Green entrepreneurial orientation (GEO), Green technology dynamism
(GTD), Environmental consciousness, Sustainable performance, Intellectual capital-based view
Paper type Research paper
1. Introduction
Within the world of modern knowledge (Guthrie et al., 1999;Oliveira et al., 2010), intellectual
capital (IC) marks as a sign of transition towards innovation, competitive advantage and
sustainable development (SD) (Carrillo et al., 2009). According to Latif et al. (2020),
stakeholders heavily pressure firms to minimise environ mental issues arising from
production activities (Singh et al., 2021). While firms worldwide have adapted rapidly to
the dynamic changes in the competitive business environment to sustain their profits and
gain competitive advantages, implementing IC to address environmental impacts is also
essential (Singh et al., 2020). In order to address stakeholders’and environmental protection
agencies’concerns and engage in green entrepreneurial actions, organisations must rely on
their IC, such as green entrepreneurial orientation (GEO) (Guo et al., 2020). Researchers have
empirically established the connection between GEO and financial performance (Fatoki,
2019;Jiang et al., 2018). In this study, GEO is proposed as a type of intellectual capital
contributing to the long-term performance of small and medium-sized enterprises (SMEs) in
developing nations (such as Pakistan and Malaysia).
IC is an essential intangible resource for entrepreneurial success (Crupi et al.,2020;
Bamel et al.,2020) that firms have to develop to effectively implement corporate strategy,
acquire and maintain sustainable competitive advantage, and improve sustainable
performance (Alvino et al., 2020). In line with this, recent calls have been made for GEO to
emerge as IC, as GEO can be a feasible solution for SMEs to attain SD under growing
environmental threats (Crupi et al., 2020). The term “GEO”is defined as the combination
of organisational strategies that captures a firm’s strategic orientation, managerial
policies, and entrepreneurial behaviours towards achieving sustainable competitive
advantage (Jiang et al.,2018;Melay et al.,2017). The manufacturing industry has recently
observed a comparatively higher adoption of IC practices which help GEO preserve the
environment, conserve nature, foster green innovations, and facilitate entrepreneurial
initiatives. Greater IC demonstrates higher knowledge concealment and higher employee
skills and training to ensure business success (Hormiga et al.,2011), aligning with the
manufacturing sector’s nature that requires knowledge linkages, managerial skills, and
employee training (Carayannis et al.,2021). The notion of GEO acts as a bridge for
sustainability-driven innovation for businesses and has been committed to an important
role in providing opportunities for green innovation, retention of CSR policies and
increased competitive advantage. However, GEO initiatives carried out by companies in
terms of SD must be in line with the expectations of the 17 Sustainable Development
Goals (SDGs), which encourage them to contribute to creating a competitive advantage
aimed at preserving environmental sustainability and well-being collective. According to
(Cammarano et al.,2022), achievement of the SDGs requires a collective effort and
cooperation between actors. In doing so, GEO is particularly affected by such changes
towards new and sustainable ways of doing business. Consequently, nexus of GEO with
SDG-oriented practices creates different opportunities within the procurement and
distribution processes, and also solves business and sustainability issues. Thus, the link
of GEO with the SDG-oriented practices may allow it to emerge and suggest a new path
for environmental sustainability.
GEO and
sustainable
performance
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