How does green innovation improve enterprises' competitive advantage? The role of organizational learning

Green innovation is an inevitable response to stringent environmental regulations as well as sustainability trends in production and consumption. Therefore, how to transform green ideas into concrete practices while enhancing competitive advantage is an urgent problem for enterprises. Adopting a knowledge-based view, this study aimed to reveal the mediating role of organizational learning in the process whereby green innovation affects enterprises' competitive advantage. This study also attempted to clarify the boundary conditions of this process using a framework that combines stakeholder theory and institutional theory. Based on a sample of 235 Chinese manufacturers, the proposed theoretical model was tested using the causal steps approach and structural equation modeling. The results indicated that green innovation was positively related to enterprises' competitive advantage, and this process was mediated by organizational learning. Furthermore, stakeholder and policy pressures both positively moderated the mediating effect of organizational learning. It is thus recommended that competitive advantage should be established based on the synergy between macrolevel green innovation strategies and microlevel organizational learning activities. In addition to acting upon stakeholders' calls for environmentally friendly production, enterprises should also positively accept policy pressures and aim to meet or exceed environmental regulations. (C) 2020 Institution of Chemical Engineers. Published by Elsevier B.V. All rights reserved.