The Influence of Green Intellectual Capital on Green Product and Process Innovation: The Mediating Role of Green Knowledge Sharing in the Pakistani SMEs

Abstract

The present study is undertaken to investigate the underlying mechanism of the relationship between three dimensions of Green Intellectual Capital (GIC), which include Green Human Capital (GHC), Green Structural Capital (GSC), and Green Relational Capital (GRC), with green product innovation (GPDI) and green process innovation (GPRI) within the context of Pakistani manufacturing Small and Medium Enterprises (SMEs). This investigation aims to elucidate the function of green knowledge sharing (GKS) as a mediating mechanism among GHC, GSC, GRC, GPDI, and GPRI by incorporating concepts from the natural resource based view (NRBV) and the knowledge based view (KBV) theories. A quantitative study design was used, with survey data collected from 381 owners and managers of manufacturing SMEs in Pakistan. Structural Equation Modeling (SEM) techniques were used to examine the proposed relationships among these variables. Results show that all components of GIC considerably influence both GPDI and GPRI, directly and indirectly through GKS. GKS has a significant impact on the development of intangible green competencies, resulting in innovative outcomes. This research contributes to the literature by applying NRBV and KBV theories in the context of green innovation within resource constrained SMEs. The study found that these firms can enhance their green innovation performance by leveraging green intellectual capital and cultivating a culture of green knowledge sharing. The study has significant implications for policymakers and business leaders in developing regions, promoting and encouraging the adoption of sustainable approaches.