Abstract
The present study investigates the strategic mechanisms employed by manufacturing firms to transform green finance initiatives into resilient capabilities amidst prolonged turbulence. Drawing from the resource-based view and the integration–responsiveness framework, the study explores the impact of green finance and green and blue infrastructure on sustainable competitive advantages and resilience amid ongoing political and economic uncertainty in Pakistan, with additional moderation by smart technology, artificial intelligence, robotics, and algorithms capabilities. Data were collected from 390 executives in the manufacturing sector of Pakistan, and the analysis was conducted through a two-stage structural equation modeling-artificial neural network approach. The findings reveal that green and blue infrastructure acts as mediators in the relationship between green finance and firms’ competitive advantages and resilience. Furthermore, sustainable competitive advantages sequentially mediate the relationship from green finance to green/blue infrastructure and subsequently to firm resilience. Organizational smart technology, artificial intelligence, robotics, and algorithms capabilities moderate these relationships, strengthening the association between green/blue infrastructure, competitive advantages, and firm resilience. Apart from providing empirical insights, this study offers actionable guidance for corporate executives and policymakers, emphasizing the strategic importance of green finance in boosting organizational performance amidst the challenging environment of political and economic uncertainty within the manufacturing sector.
Graphical abstract
Similar content being viewed by others
Data availability
Data will be available on demand.
References
Abbas J, Wang L, Ben BS et al (2023) Investment in renewable energy and electricity output: role of green finance, environmental tax, and geopolitical risk: empirical evidence from China. Energy 269:126683
Adebisi SA, Bakare NA (2019) Survival strategies and sustainability of small and medium enterprises in a volatile environment. Manag Dyn Knowl Econ 7:553–569
Ahmadi-Gh Z, Bello-Pintado A (2022) Why is manufacturing not more sustainable? The effects of different sustainability practices on sustainability outcomes and competitive advantage. J Clean Prod 337:130392
Alotaibi I, Abido MA, Khalid M, Savkin AV (2020) A comprehensive review of recent advances in smart grids: a sustainable future with renewable energy resources. Energies 13:6269
Astuti P, Datrini L (2021) Green competitive advantage: examining the role of environmental consciousness and green intellectual capital. Manag Sci Lett 11:1141–1152
Attaran M (2020) Digital technology enablers and their implications for supply chain management. Supply chain forum: an international journal. Taylor & Francis, pp 158–172
Baah C, Agyabeng-Mensah Y, Afum E, Lascano Armas JA (2024) Exploring corporate environmental ethics and green creativity as antecedents of green competitive advantage, sustainable production and financial performance: empirical evidence from manufacturing firms. Benchmarking Int J 31(3):990–1008
Bageis AS, Waqar A, Hamah Sor N et al (2023) Evaluation of factors affecting the competitive advantage of organizations in establishing sustainable project management post Covid-19. J Eng 2023:3529313
Bakry W, Mallik G, Nghiem X-H et al (2023) Is green finance really “green”? Examining the long-run relationship between green finance, renewable energy and environmental performance in developing countries. Renew Energy 208:341–355
Barney J (1991) Competitive advantage. J Manag 17:99–120
Beck T (2023) Access to finance: adaptability and resilience during a global pandemic. Account Bus Res 53:565–579
Cabrilo S, Dahms S, Burgos Mutuc E, Marlin J (2020) The role of IT practices in facilitating relational and trust capital for superior innovation performance: the case of Taiwanese companies. J Intellect Cap 21:753–779
Campobasso F, Boscia V (2023) Sustainability frontiers of strategic risk management and firm survival: the Altman score effectiveness. A bibliometric analysis. Bus Strateg Environ 32:3783–3791
Chen Y, Ma Y (2021) Does green investment improve energy firm performance? Energy Policy 153:112252
Chen C, Chong KM, Tan TH, Wang H (2023) Mechanism of green finance awareness on sustainable competitiveness of SMEs. Environ Proc J 8:29–47
Christensen CM, Suárez FF, Utterback JM (1998) Strategies for survival in fast-changing industries. Manag Sci 44:S207–S220
Dai X, Siddik AB, Tian H (2022) Corporate social responsibility, green finance and environmental performance: Does green innovation matter? Sustainability 14:13607
Dangelico RM, Pontrandolfo P (2015) Being ‘green and competitive’: the impact of environmental actions and collaborations on firm performance. Bus Strateg Environ 24:413–430
de Sousa TC, de Melo CO (2021) Sustainable infrastructure, industrial ecology, and eco-innovation: positive impact on society. Industry innovation and infrastructure. Springer, pp 1093–1102
Ding L (2021) Employees’ challenge-hindrance appraisals toward STARA awareness and competitive productivity: a micro-level case. Int J Contemp Hosp Manag 33:2950–2969
Dong H, Tao M (2022) The policy effect of green finance reform and innovations: empirical evidence at the firm level. PLoS ONE 17:e0278128
Falcone PM (2020) Environmental regulation and green investments: the role of green finance. Int J Green Econ 14:159–173
Flores-Hernández JA, Cambra-Fierro JJ, Vázquez-Carrasco R (2020) Sustainability, brand image, reputation and financial value: manager perceptions in an emerging economy context. Sustain Dev 28:935–945
Fornell C, Larcker DF (1981) Evaluating structural equation models with unobservable variables and measurement error. J Mark Res 18:39–50
Ge B, Yang Y, Jiang D et al (2018) An empirical study on green innovation strategy and sustainable competitive advantages: path and boundary. Sustainability 10:3631
Gilchrist D, Yu J, Zhong R (2021) The limits of green finance: a survey of literature in the context of green bonds and green loans. Sustainability 13:478
González-Ruiz JD, Botero-Botero S, Duque-Grisales E (2018) Financial eco-innovation as a mechanism for fostering the development of sustainable infrastructure systems. Sustainability 10:4463
Guerrero-Villegas J, Sierra-García L, Palacios-Florencio B (2018) The role of sustainable development and innovation on firm performance. Corp Soc Responsib Environ Manag 25:1350–1362
Hair JF Jr, Matthews LM, Matthews RL, Sarstedt M (2017) PLS-SEM or CB-SEM: updated guidelines on which method to use. Int J Multivar Data Anal 1:107–123
Haseeb M, Hussain HI, Kot S et al (2019) Role of social and technological challenges in achieving a sustainable competitive advantage and sustainable business performance. Sustainability 11:3811
Henseler J, Ringle CM, Sarstedt M (2012) Using partial least squares path modeling in advertising research: basic concepts and recent issues. Handbook of research on international advertising. Edward Elgar Publishing
Henseler J, Ringle CM, Sarstedt M (2015) A new criterion for assessing discriminant validity in variance-based structural equation modeling. J Acad Mark Sci 43:115–135
Hirani SAA, Richter S, Salami B, Vallianatos H (2023) Sociocultural factors affecting breastfeeding practices of mothers during natural disasters: a critical ethnography in rural Pakistan. Glob Qual Nurs Res 10:23333936221148810
Hussain S, Ali R, Emam W et al (2023a) Economic policy uncertainty and firm value: impact of investment sentiments in energy and petroleum. Sustainability 15:9656
Hussain S, Rasheed A, Rehman S ur (2023b) Driving sustainable growth: exploring the link between financial innovation, green finance and sustainability performance: banking evidence. Kybernetes 52. https://doi.org/10.1108/K-05-2023-0918
Idrees M, Nergis Y, Irfan M (2023) Industrial emission monitoring and assessment of air quality in Karachi Coastal City, Pakistan. Atmosphere (basel) 14:1515
Iqbal MA, Nadim N, Akbar Z (2022) Determinants of recent inflation in pakistan and its relation with economic growth: an econometric analysis. Pak J Humanit Soc Sci 10:345–353
Jakhar SK, Bhattacharya A, Rathore H, Mangla SK (2020) Stakeholder pressure for sustainability: Can ‘innovative capabilities’ explain the idiosyncratic response in the manufacturing firms? Bus Strateg Environ 29:2635–2653
Javed SA (2021) Strategic directions for Pakistan’s agenda for smes. Sustainable Development Policy Institute
Jung K, Bae D-H, Um M-J et al (2020) Evaluation of nitrate load estimations using neural networks and canonical correlation analysis with k-fold cross-validation. Sustainability 12:400
Khan MA, Riaz H, Ahmed M, Saeed A (2022) Does green finance really deliver what is expected? An empirical perspective. Borsa Istanb Rev 22:586–593
Khan NR, Ameer F, Bouncken RB, Covin JG (2023) Corporate sustainability entrepreneurship: the role of green entrepreneurial orientation and organizational resilience capacity for green innovation. J Bus Res 169:114296
Kronenberg J, Andersson E, Barton DN et al (2021) The thorny path toward greening: unintended consequences, trade-offs, and constraints in green and blue infrastructure planning, implementation, and management. Ecol Soc 26:36
Kulkov I, Kulkova J, Rohrbeck R et al (2023) Artificial intelligence-driven sustainable development: examining organizational, technical, and processing approaches to achieving global goals. Sustain Dev 1–15. https://doi.org/10.1002/sd.2773
Kumar K, Rao RS, Kaiwartya O et al (2022a) Sustainable developments by artificial intelligence and machine learning for renewable energies. Academic Press
Kumar L, Nadeem F, Sloan M et al (2022b) Fostering green finance for sustainable development: a focus on textile and leather small medium enterprises in Pakistan. Sustainability 14:11908
Mai Z, Nawaz Saleem HM, Kamran M (2023) The relationship between political instability and stock market performance: an analysis of the MSCI index in the case of Pakistan. PLoS ONE 18:e0292284
Mngumi F, Shaorong S, Shair F, Waqas M (2022) Does green finance mitigate the effects of climate variability: role of renewable energy investment and infrastructure. Environ Sci Pollut Res 29:59287–59299
Mohammad WMW, Wasiuzzaman S (2021) Environmental, social and governance (ESG) disclosure, competitive advantage and performance of firms in Malaysia. Clean Environ Syst 2:100015
Munir S, Irfan M, Malik MS (2022) Impact of sustainable finance on the firm performance: a study on the Pakistani banking sector. Indian J Econ Bus 21(2):145–164
Najmi A, Kanapathy K, Aziz AA (2021) Understanding consumer participation in managing ICT waste: findings from two-staged structural equation modeling-artificial neural network approach. Environ Sci Pollut Res 28:14782–14796
Nassani AA, Yousaf Z, Radulescu M et al (2023) Green innovation through green and blue infrastructure development: Investigation of pollution reduction and green technology in emerging economy. Energies 16:1944
Ng AW, Nathwani J, Fu J, Zhou H (2021) Green financing for global energy sustainability: prospecting transformational adaptation beyond Industry 4.0. Sustain Sci Pract Policy 17:377–390
Ning Y, Cherian J, Sial MS et al (2023) Green bond as a new determinant of sustainable green financing, energy efficiency investment, and economic growth: a global perspective. Environ Sci Pollut Res 30:61324–61339
Ogbeibu S, Jabbour CJC, Gaskin J et al (2021) Leveraging STARA competencies and green creativity to boost green organisational innovative evidence: a praxis for sustainable development. Bus Strateg Environ 30:2421–2440
Ogbeibu S, Emelifeonwu J, Pereira V, Oseghale R, Gaskin J, Sivarajah U, Gunasekaran A (2023) Demystifying the roles of organisational smart technology, artificial intelligence, robotics and algorithms capability: a strategy for green human resource management and environmental sustainability. Bus Strateg Environ 33(2):369–388
Oosthuizen RM (2019) Smart technology, artificial intelligence, robotics and algorithms (STARA): employees’ perceptions and wellbeing in future workplaces. Theory, research and dynamics of career wellbeing. Springer, Cham, pp 17–40
Pakistan Bureau of Statistics (2023) No Title. https://www.pbs.gov.pk/content/industry
Podsakoff PM, MacKenzie SB, Lee J-Y, Podsakoff NP (2003) Common method biases in behavioral research: a critical review of the literature and recommended remedies. J Appl Psychol 88:879
Prahalad CK, Doz YL (1987) The multinational mission: balancing local demands and global vision. Simon and Schuster
Rahman Ur A, Wen F, Amjad F, Ullah R (2023) Exploring the impact of crowdfunding and collaborations on firm survival through crisis management in the context of Pakistan. Technol Anal Strateg Manag 1–17. https://doi.org/10.1080/09537325.2023.2299350
Ren X, Shao Q, Zhong R (2020) Nexus between green finance, non-fossil energy use, and carbon intensity: empirical evidence from China based on a vector error correction model. J Clean Prod 277:122844
Sadiq M, Nonthapot S, Mohamad S et al (2022) Does green finance matter for sustainable entrepreneurship and environmental corporate social responsibility during COVID-19? China Financ Rev Int 12:317–333
State bank of Pakistan (2022) No title. https://www.sbp.org.pk/reports/annual/arfy04/qtr-index-eng.htm
State bank of Pakistan (2023) No title
Subiza-Pérez M, Hauru K, Korpela K et al (2019) Perceived environmental aesthetic qualities scale (PEAQS)—a self-report tool for the evaluation of green-blue spaces. Urban for Urban Green 43:126383
Xiliang Q, Kuo Y-K, Abourehab MAS et al (2023) The impact of ICT, green finance, and CSR on sustainable financial performance: moderating role of perceived organizational support. Econ Res Istraživanja 36:2151489
Xin Y, Khan RU, Dagar V, Qian F (2023) Do international resources configure SMEs’ sustainable performance in the digital era? Evidence from Pakistan. Resour Policy 80:103169
Xiong L, Wang H, Wang C (2022) Predicting mobile government service continuance: a two-stage structural equation modeling-artificial neural network approach. Gov Inf Q 39:101654
Yamane T (1973) Statistics: an introductory analysis
Zhou B, Zhang C (2023) When green finance meets banking competition: evidence from hard-to-abate enterprises of China. Pacific-Basin Financ J 78:101954
Funding
The authors declare that no funds, grants, or other support were received during the preparation of this manuscript.
Author information
Authors and Affiliations
Contributions
Amin ur rahman: Project administration, conceptualized, critical reviewing, data collection, analysis, and manuscript writing. Fiza Amjad: Collaborative research, critical review, Editing, data analysis, and manuscript preparation.
Corresponding author
Ethics declarations
Conflict of interest
The authors declare that there is no conflict of interest regarding the publication of this paper.
Ethical approval
Compliance with Ethical Standards.
Consent to participate
The authors have no relevant financial or non-financial interests to disclose.
Consent to publish
Not applicable.
Additional information
Publisher's Note
Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.
Rights and permissions
Springer Nature or its licensor (e.g. a society or other partner) holds exclusive rights to this article under a publishing agreement with the author(s) or other rightsholder(s); author self-archiving of the accepted manuscript version of this article is solely governed by the terms of such publishing agreement and applicable law.
About this article
Cite this article
Ur Rahman, A., Amjad, F. The role of green finance, infrastructure, and technological capabilities in enhancing competitiveness resilience of Pakistani manufacturing firms: a sequential mediation–moderation analysis. Clean Techn Environ Policy (2024). https://doi.org/10.1007/s10098-024-02837-8
Received:
Accepted:
Published:
DOI: https://doi.org/10.1007/s10098-024-02837-8