Green dynamic capabilities - the necessity between green intellectual capital and firm performance: Evidence from Taiwan's manufacturing sector

• Published in: Corporate Management Review 2019-12, Vol.39 (2), p.37-67
• Main Authors: 桑國忠(Kuo-Chung Shang), 陳秀育(Shiou-Yu Chen), 余坤東(Kung-Don Ye), 游昕怡(Hsin-Yi Yu)
• Format: Article
• Language: English
• Subjects: Competitive advantage; Environmental protection; Innovations; Manufacturing
• ISSN: 1028-7310

Both academic and business circles are paying more attention to environmental issues due to growing global awareness and concerns. At the same time, the rapid changes of environmental protection regulations are creating uncertain dynamics in competitive market environments. As such, an organization cannot solely rely on its valuable intellectual capital to support superior performance; it must utilize its dynamic capabilities to integrate, build, and reconfigure inherent organizational idiosyncratic resources. This paper therefore develops a research model to examine strategic corporate actions undertaken to address environmental issues using the natural resource-based view (NRBV) with dynamic capabilities so as to elaborate upon the sources and mechanisms of firm performance. Employing subjective and objective data of 170 manufacturing companies in Taiwan, this research examines the causal relationships among green intellectual capital, green dynamic capability, and firm financial performance. The proposed research framework partially supports and verifies the indirect-only mediated effects of green dynamic capabilities. The findings suggest that senior managers should follow the strategic path of enforcing and improving their firms' green dynamic capabilities in order to sustain superior performance.