Attaining sustainable business performance via eco-innovation under ecological regulatory stringency and market turbulence

The study examines approaches wherein two external factors spur Ghanaian firms to eco-innovate: ecological regulatory stringency and market turbulence. The study's conceptual framework is evaluated using survey data from 513 Ghanaian manufacturing firms using a hybrid Partial Least Square-Structural Equation Model and Arttificial Neural Network technique, which provides support to the proposed hypothesis. Thus, by dividing eco-innovation into product eco-innovation and process eco-innovation, we infer that ecological regulation stringency improves sustainable business performance primarily through process eco-innovation instead of product eco-innovation and market turbulence has a greater impact on sustainable business performance through product eco-innovation as opposed to process ecoinnovation. Our research adds to the literature on eco-innovation and green economy by providing a comprehensive framework for measuring a firm's pursuit of eco-innovation and sustainability in response to government and market pressures. We conclude by providing theoretical, methodological and practical implications.

Automated summary

This study examines how ecological regulatory stringency and market turbulence stimulate eco-innovation in Ghanaian firms. The research findings suggest that ecological regulation primarily improves sustainable business performance through process eco-innovation, while market turbulence has a greater impact on sustainable business performance through product eco-innovation. The study adds to the existing literature on eco-innovation and green economy by providing a comprehensive framework for measuring firms' pursuit of eco-innovation and sustainability.