Environmental innovation and firm performance:How firm size and motives matter


There is limited understanding of the precise circumstances under which environmental actions-such as environmental innovation-contribute to firm performance. Building on the resource-based view and on stakeholder theory, this study argues that the general positive effect of environmental innovation on financial performance varies significantly with firm size and the motives underlying a firm's engagement in environmental innovation. Integrating survey data and lagged annual account data on 1761 Flemish companies, we find that larger firms benefit financially from environmental innovation driven by regulation or industry codes of conduct, while smaller firms benefit from environmental innovation introduced in response to customer demand. While it is increasingly accepted that environmental innovation relates positively with firm performance, the current study highlights important boundary conditions of this relationship.

Publication DOI: https://doi.org/10.3390/su11133585
Divisions: College of Business and Social Sciences > Aston Business School > Economics, Finance & Entrepreneurship
Funding Information: Funding: Part of this research was funded by the European Commission, Socioeconomic Sciences and Humanities Grant Agreement 613500 (Seforïs project). Acknowledgments: The authors gratefully acknowledge financial support from the European Commission, Socio
Additional Information: This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited
Uncontrolled Keywords: Environmental innovation,Firm performance,Firm size,Motives,Geography, Planning and Development,Renewable Energy, Sustainability and the Environment,Management, Monitoring, Policy and Law
Last Modified: 09 Jul 2024 07:07
Date Deposited: 30 Mar 2020 08:23
Full Text Link:
Related URLs: http://www.scop ... tnerID=8YFLogxK (Scopus URL)
https://www.mdp ... 1050/11/13/3585 (Publisher URL)
PURE Output Type: Article
Published Date: 2019-06-29
Accepted Date: 2019-06-23
Authors: Andries, Petra
Stephan, Ute (ORCID Profile 0000-0003-4514-6057)



Version: Published Version

License: Creative Commons Attribution

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