Abstract
This study investigates the relationships among Corporate Sustainability Development (CSD), Enterprise Risk Management Performance (ERMP), and Green Innovation (GI) in the Jordanian manufacturing sector. Using data from 97 companies listed on the Amman Stock Exchange, we employed structural equation modeling to examine these complex dynamics. Our findings reveal that CSD negatively impacts both ERMP and enterprise sustainable performance in the short term, challenging conventional wisdom. However, CSD strongly promotes GI, which in turn positively influences ERMP while negatively affecting short-term performance. GI acts as a significant mediator, positively mediating the CSD-ERMP relationship and negatively mediating the CSD-performance link. These results extend the sustainability paradox concept to emerging economies and highlight the critical role of green innovation in balancing sustainability initiatives with risk management and performance outcomes. The study suggests that firms may experience initial disruptions when implementing sustainability practices, but these initiatives can drive innovation within organizations. Based on these findings, we recommend that managers in emerging economies adopt a long-term perspective when implementing sustainability initiatives and develop more flexible risk management systems. Policymakers should consider supportive frameworks to help firms navigate the tensions between sustainability, innovation, and short-term performance. Future research should employ longitudinal designs to capture the dynamic nature of these relationships and explore potential moderating factors such as firm size or industry-specific characteristics.