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How green-friendly practices and environmental disclosure affect the technological capability of the firm

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  • Rizwan Ullah

    (Harbin Institute of Technology)

  • Weiwei Wu

    (Harbin Institute of Technology)

Abstract

Global environmental issues arise because certain companies pursue rapid growth at the cost of significant resource use and degrading the environment. Under these circumstances, the stakeholders rapidly required companies to adopt green-friendly practices. This study investigates how green-friendly practices and environmental disclosure supported technological capability, and then further discusses the moderating effect of environmental disclosure on the relationship among green-friendly practices and technological capability. From 2008 to 2017, using a dataset of 1487 observations from Pakistan’s listed manufacturing firms, the findings found that green-friendly practices and environmental disclosure had a positive effect on technological capability and also that the interaction of green-friendly practices and environmental disclosure had a positive effect on the degree to which the green-friendly practices of the firm could achieve its maximum potential for technological capability. According to our empirical results, the variables are positively and significantly correlated in the long run. The results suggested that green-friendly practices positively impact the firm's technological capability. The findings also indicate that environmental disclosure has a positive influence on green-friendly practices and moderates the relationship between green-friendly practices and the firm's technological capability. Green-friendly practices can also help improve environmental quality by promoting investment in energy-efficient technology to boost domestic manufacturing while minimizing environmental degradation. The results of this study will advance the research on environmental governance and provide a new route for future research.

Suggested Citation

  • Rizwan Ullah & Weiwei Wu, 2023. "How green-friendly practices and environmental disclosure affect the technological capability of the firm," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 25(2), pages 1276-1300, February.
    • Handle: RePEc:spr:endesu:v:25:y:2023:i:2:d:10.1007_s10668-021-02094-5
    DOI: 10.1007/s10668-021-02094-5
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