Modelling the significance of strategic orientation on green innovation: mediation of green dynamic capabilities

Abstract The increasing recognition of environmental concerns has prompted both nations and corporations to adopt green innovation as a significant strategy for addressing environmental risks and promoting sustainable development. To excel in this pursuit, companies must cultivate green dynamic capabilities, infusing environmental considerations into their strategic decision-making processes. The purpose of this study is to investigate the association between strategic orientation components and green dynamic capabilities, as well as their impact on green product and process innovation, in medium-to-large-sized manufacturing firms in China. Employing a quantitative methodology, an online cross-sectional research design was used to gather 582 valid responses through a structured questionnaire. Results indicated a positive association between learning orientation and green dynamic capabilities. Furthermore, green dynamic capability was found to mediate the relationship between learning orientation and green product and process innovation. However, no significant relationship was observed between green entrepreneurial orientation, market orientation, internationalisation orientation, and green dynamic capabilities. By conducting multi-group analysis and studying the context of Chinese manufacturing firms, this research contributes new insights into the relationship between resource-based theory constructs and green innovation, including the integration of green dynamic capabilities. The results emphasise the significance of adopting a learning mindset, developing green dynamic capabilities, and fostering green innovation. These findings offer useful insights for the Chinese manufacturing industry, enabling it to strengthen its competencies in green innovation.