Why firms go green and how green impacts financial and innovation performance differently: An awareness-motivation-capability perspective

Based on the awareness-motivation-capability framework, this research examines how firm-level factors (environmental scanning and organizational slack) individually and collectively interact with institutional factors (government support and industry competition) to influence a firm's adoption of green management. Moreover, we distinguish the impacts of green management on financial performance and innovation performance. The empirical findings reveal that environmental scanning and organizational slack facilitate green management, government support strengthens these positive relationships, and industry competition attenuates the effect of environmental scanning on green management. In addition, green management enhances innovation performance to a greater extent than financial performance. This research provides an integrative framework illustrating how firm-level factors and institutional environments influence green decisions and proposes that green management may impact firm performance measures in distinctive ways.