Does environmental cooperation with suppliers matter under environmental strategy focus and digital technology knowledge?

Environmental cooperation with suppliers (ECS) helps firms to effectively manage dispersed suppliers, thereby addressing stakeholders' environmental concerns. However, the literature is inconclusive regarding the relationship between ECS and financial performance (FP). Unlike previous research on ECS, this study uses the motivation-opportunity-ability (MOA) theory to analyze the relationship between ECS and FP, with firm innovativeness as a mediator. Furthermore, environmental strategy focus and digital technology knowledge are considered contingent factors in the link between ECS and FP. The SPSS version of PROCESS was employed to test the hypotheses, using ordinary least squares regression with survey data collected from 136 Chinese firms. The results reveal that firm innovativeness positively mediates the relationship between ECS and FP. Moreover, environmental strategy focus and digital technology knowledge strengthen the indirect impact of ECS on FP via firm innovativeness. Finally, this study provides theoretical and practical implications for firms when implementing ECS and firm innovativeness.