Total quality management and hydrogen finance: Strengthening organizational legitimacy through procurement and innovation

Abstract

This study investigates how hydrogen procurement and innovation, when embedded within Total Quality Management (TQM) frameworks, influence financial performance, organizational legitimacy, and access to hydrogen finance in Ghana’s nascent energy storage sector. In the context of limited financial infrastructure and regulatory fragility, the research aims to determine whether TQM acts as a critical mediating mechanism linking operational practices with sustainable financial outcomes. Drawing on survey data from 244 manufacturing firms collected between 2022 and 2023, Partial Least Squares Structural Equation Modeling (PLS-SEM) is employed to evaluate the direct and indirect effects among procurement strategies, innovation practices, quality management systems, legitimacy perceptions, and financial accessibility. The findings reveal that hydrogen procurement strongly drives improvements in TQM (β = 0.41, p < 0.001) and organizational legitimacy (β = 0.38, p = 0.01), yet shows no direct impact on hydrogen finance access (β = 0.12, p = 0.08). In contrast, both product and process innovation exert significant positive effects on legitimacy and TQM adoption (β > 0.40, p < 0.001). Crucially, TQM mediates the relationship between operational inputs and financial performance (β = 0.35, p < 0.01), reinforcing its role in strengthening investor confidence and institutional transparency. These findings highlight the strategic value of institutionalizing TQM in energy storage ecosystems, suggesting that embedding quality certification and outcome-based evaluations into hydrogen finance frameworks can enhance financial inclusivity, especially for small and medium-sized enterprises. The study advocates for policy integration of TQM standards into green bond eligibility and sustainability-linked financing to bolster long-term industrial resilience and clean energy adoption