Relationships among circumstance pressure, green technology selection and firm performance

In their quest for greater sustainability, firms need to deal with many variables that ultimately determine the selection of green technologies. Previous studies of the possible link between the application of green technology and firm performance have generally produced mixed results. Similarly, studies of the relationship between environmentally friendly strategies and firm performance have also been inconclusive. Based on an extensive empirical study, with 533 respondents from 98 firms in the Chinese manufacturing industry, we try to identify the essential factors and test the links among variables in the decision-making process for green technology selection. We use an integrated structure equation model to test the complexity of a firm's technology adoption. The relationships among the various variables are tested based on empirical data from our questionnaire. More specifically, we measure the influences on green technology selection imposed by task-oriented circumstances (direct stakeholders, market environment, financial and social dynamics) and macro-circumstances (legislation, social and technological development phases, etc.). The results show significant relationships between green technology selection and certain task-oriented circumstances and macro-circumstances, which may facilitate proper action on the part of firms with regard to green practices. Based on our findings, we present some managerial implications and insights that might be useful for adopters of green technologies and enhance environmental and overall performance. We also discuss the limitations of our methodology at the end of the paper