ESG Practices to Foster Green Innovation with Moderating Role of Innovation Orientation: A Conceptual Framework for the Manufacturing Organizations

Abstract

Abstract In today's dynamic world, many organizations often do not incorporate Environmental, Social and Governance (ESG) practices which are the critical input for green innovation and further sustainable development. There is, however, deficient evidence regarding how ESG practices and innovation orientation affect green innovation in manufacturing listed companies on Bursa Malaysia. Thus, this paper seeks to conceptualize a framework to examine the impact of ESG practices on green innovation by examining the moderating impact of innovation orientation in manufacturing listed companies. This study proposes a quantitative approach by using the well-structured questionnaire for the data collection. The questionnaire will be distributed to 182 manufacturing listed companies on Bursa Malaysia to gain insights about the ESG practices, innovation orientation and green innovation. As part of this research work, Smart Partial Least Square-Structural Equation Modeling (PLS-SEM) is proposed to investigate the relationship between constructs. This conceptualization of ESG practices toward green innovation will provide insights into formulating strategies and will serve as an important conduit to improve green innovation. The application of this proposed model to public listed companies strengthens the originality of this study. Moreover, this work will help in strategic planning toward enhancing green innovation and this will certainly develop business competitiveness and achieve sustainable business performance.