Determinants of environmental innovation: performance alongthe vertical supply chain

Increasing environmental awareness induces a shift in society that drives firms to become more sustainable. Reacting to governmental pressures and consumer demands, organizations use environmental innovation to convert the inevitable challenges into opportunities. Building on institutional theory, stakeholder theory and existing innovation literature, this study assesses the causal impact of institutional pressure on the effect of research and development collaborations along the supply chain and environmental innovation performance by applying a negative binomial moderation model. By analyzing data from the 2015 release of the German Community Innovation Survey, the results suggest that research and development collaboration both upstream and downstream the supply chain is increasing environmental innovation performance. The findings indicate that, in line with the weak Porter hypothesis, the moderation effect of governmental policies(regulatory pressure)is facilitating environmental innovation performance positively. The moderation effect of market pressure (normative pressure) is yielding mixed results. The findings emphasize the importance of environmental policies in order to increase environmental innovation performance. The thesis contributes to theory development on the conditions that impact environmental innovation performance and to the literature on environmental innovation in general