The Impact of Green Supply Chain Management Practices on Firm Performance: Evidence from Manufacturing Industry

Abstract

Global climate change, environmental pollution and depleting natural resources have necessitated major changes in the way businesses undertake procurement, manufacturing, operations and provision of goods and services to customers. Therefore, green supply chain management (GSCM) practices have caught the attention of researchers in many different countries. However, the adoption of GSCM practices and their influence on firm performance is still in its early stages. This study examines the influence of GSC determinants on firm performance in Pakistan’s manufacturing industry. Survey data was collected from 317 respondents working at various managerial levels in supply chains from manufacturing firms of Pakistan. Green supply chain management practices were assessed using five variables; ‘eco-design, green purchasing, green information systems, cooperation with customers and green manufacturing’. Multiple linear regression analysis indicated that green supply chain (GSC) initiatives had a significant impact on firm performance. Excluding green purchasing, the remaining four elements of GSC were shown to be statistically significant in predicting firm performance. This study highlights the importance of employing green strategies and practices in supply chains in order to improve overall organizational performance. In addition to practical implications for supply chain related environmental concerns, some directions for future research have also been suggested.