Technological innovation and environmental performance: evidence from China

Abstract

PurposeThis study empirically investigates the impacts of technological innovation and operational efficiency on environmental performance and the moderating effects of environmental orientation.Design/methodology/approachWe develop a conceptual framework based on the Porter Hypothesis. We collect a sample of 850 listed firms in China between 2010 and 2019. The fixed effect model was used to analyse the data.FindingsThe empirical findings reveal that technological innovation indirectly enhances environmental performance through operational efficiency and partially mediates this impact. We also find that environmental orientation strengthens the positive impacts of technological innovation and operational efficiency on environmental performance.Originality/valueThis study contributes to the literature by revealing that technological innovation is positively associated with operational efficiency and environmental performance, which suggests that technological innovation can simultaneously enhance business and environmental performance. Hence, this study provides empirical support for the Porter Hypothesis. The results also extend the Porter Hypothesis by revealing how technological innovation affects environmental performance and under what conditions technological innovation has a greater impact on environmental performance.