Institutional Pressure, Environmental Innovation and Performance: Evidence from China

Environmental innovation has strategic importance to cope with the pollution of environment. Organizations often adopt environmental innovation due to institutional pressures. Three institutional pressures may influence environmental innovation practices, which named government, customer, and competitor pressures are explicitly considered in this study. We propose and empirically test a model using data collected from 148 manufacturers in the PRD. The result shows that the institutional pressures come from government, customer, and competitor have significant positive influences on environmental innovation practices. However, we only find significant positive impact of environmental innovation on environmental performance, the effect of environmental innovation on economic performance should be through the mediating role of environmental performance.