From Green Intentions to Golden Returns: The role of Innovation in achieving Sustainability Performance

Abstract

This paper assesses the importance of financial resources and Intellectual Capital in SMEs' environmental and financial performance with the mediating role of technology innovation. Through a survey, 157 owners and managers of Pakistani SMEs provided empirical data for the models testing. The structural equation modeling results demonstrate that financial resources and intellectual capital have a significant positive Influence on environmental, financial performance, and technology innovation. Additionally, the outcome showed that technology innovation mediates to some extent the relationships between financial resources and the financial and environmental performance of businesses. In a similar vein, technology innovation fully mediates the link between intellectual capital and financial performance but only partially mediates the relationship between government intellectual capital and environmental performance. According to this research, the government and policymakers should give the industrial sector financial resources to boost technological innovation and performance. This will enable these businesses to support economic and environmental progress.

Keywords:

Intellectual capital, Financial Resources, Technology Innovation, Financial Performance, Environmental Performance.