Examining Corporate Environmental Proactivity and Operational Performance: A Supplier Collaboration and Innovation Perspective

There is ongoing debate on whether a proactive environmental management strategy creates value for firm performance. Based on the combined strategy-structure-performance framework and resource-based view of the firm, this study examines the underlying mechanism to link a firm’s proactive environmental management strategy to a firm’s operational performance improvement.  We posit that the strategic stance of firms in improving their operational performance and competitive position requires effective environmental collaboration with suppliers and environmental innovation development. Our hypothesized model is tested using a sample of 229 supply chain managers derived from a Dunn and Bradstreet database. Our empirical results show support for the mediation effects, which indicates the importance for firms to collaborate with suppliers on the environmental issues and develop environmental innovation to reap the operational performance benefits.