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Does CEO Power Affect Manufacturing Firms’ Green Innovation and Organizational Performance? A Mediational Approach

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  • Qiuyan Yan

    (Business School, Central University of Finance and Economics, Beijing 100081, China)

  • Jing Yan

    (School of Business, Shandong University, Weihai 264209, China)

  • Duo Zhang

    (International Institute of Culture and Education, Northeast Agricultural University, Harbin 150038, China)

  • Shuochen Bi

    (D’Amore-McKim School of Business, Northeastern University, Boston, MA 02115, USA)

  • Ying Tian

    (School of Management, Shandong University, Jinan 250100, China)

  • Riaqa Mubeen

    (School of Management, Harbin Institute of Technology, Harbin 150001, China)

  • Jaffar Abbas

    (School of Media and Communication (SMC), Shanghai Jiao Tong University (SJTU), Shanghai 200240, China)

Abstract

In this research work, we investigate the direct impact of CEO power on corporate performance, as well as the mediating role of green innovation in this hypothesized relationship. In this study, we use observation data collected from 780 listed manufacturing companies, explicitly focusing on the Karachi Stock Exchange (KSE), and adopt a GMM (generalized method of moments) model for testing our hypotheses. The results of this research show that CEO power has a negative impact on sustainable corporate performance, while the mediating role of green innovation positively and completely regulates the effect of CEO power on enterprises’ sustainable performance. This study adds novelty to the literature as it explores the influence of green innovation in manufacturing enterprises on CEO power and firm performance and observes the direct impact of green innovation and CEO power on sustainable business performance. The results of this study show that a green innovation strategy significantly affects CEO power and manufacturing firm performance and that companies that adopt green initiatives can increase corporate value and improve their reputation among stakeholders. The conclusions of this study have important implications for both theory and practice in this field.

Suggested Citation

  • Qiuyan Yan & Jing Yan & Duo Zhang & Shuochen Bi & Ying Tian & Riaqa Mubeen & Jaffar Abbas, 2024. "Does CEO Power Affect Manufacturing Firms’ Green Innovation and Organizational Performance? A Mediational Approach," Sustainability, MDPI, vol. 16(14), pages 1-17, July.
    • Handle: RePEc:gam:jsusta:v:16:y:2024:i:14:p:6015-:d:1434979
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    References listed on IDEAS

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