Business networking orientation, green operations practices and firm performance

Abstract

PurposeThe authors apply social network theory and natural resource–based view to empirically examine a model of the relationships among business networking (BN) orientation, green operations practices and performance. A firm must achieve appropriate internal green operations practices to capitalize on its external BN orientation and thus be able to establish a competitive advantage and superior performance.Design/methodology/approachUsing survey data from 132 ISO 14001–certified manufacturing firms in Malaysia, all of which participate in environmental programs and sustainability activities, the authors explore the effects of two BN orientation facets (customer-oriented and supplier-oriented) on green operations practices (green purchasing, eco-design and regulatory practices) and their subsequent influence on environmental and economic performance.FindingsStructural equation modeling outcomes confirm only one BN orientation facet positively affects green operations practices, nor do the advantages affect economic performance directly. The results illustrate how environmental outcomes mediate the links between green operations practices and economic performance.Originality/valueDrawing on social network theory and natural resource–based view, authors propose internal green operations practices as a channel through which external BN orientation induces firm performance. Internal green operations practices determine a firm's ability to exploit its external BN orientation to achieve operational competencies and lead to superior performance. Rather than focusing on the social connections generated by external BN orientation itself, the authors recommend that firms address the core competencies contributing to their green operations practices and engage in network building.