Eco-innovation Adoption in Malaysian Contractor Firms: Understanding the Components and Drivers

Eco-innovation (EI) is a concept that integrates eco-consciousness within innovation development.  While EI has been widely applied in the manufacturing industry, its adoption in the construction sector remains uncertain. The rising concern of environmental impacts on construction necessitates the importance of finding more innovative ways to push environmental needs within the complexity of projects’ design and methods. Contractors hold a strategic position to promote and adopt EI into management, construction, and development. This paper explores 1) the adoption level of EI practices and 2) the relationship between the adoption of EI practices and the factors that drive EI, within the Malaysian contractor firms. A questionnaire survey was developed using 18 EI components and four driving factors. A total of 95 Grade G7 contractor firms responded to the survey. The survey revealed that the level of EI adoption in contractor firms is still at a moderate pace. The results showed that organisational EI is a crucial component that supports the firm’s eco-innovative management approach to improve firm’s environmental performance. The results indicated that all four driving factors have a positive relationship with the implementation of EI. Technology factor was identified as crucial in influencing better adoption of EI in contractor firms. Findings from this study are beneficial to develop a framework on strategies to increase the EI adoption rate among the contractor firms and deepen the understanding of EI implementation at the firm level, further extending to the project site level.