Business, Management and Education

ISSN 2029-7491 / eISSN 2029-6169

2017, 15(1): 91–108
doi:10.3846/bme.2017.354

The Impact of Green Supply Chain Management

Practices on Performance:
Moderating Role of Institutional Pressure with
Mediating Effect of Green Innovation

Muhammad Nouman SHAFIQUE1,

Muhammad Shahid ASGHAR2, Haji RAHMAN3
1Department of Business Management, Dongbei University of Finance and Economics,
217 Jianshan St.,116025, Sha He Kou Dist. Dalian, China
2School of Management, Shandong University, 27 Shanda Nanlu, 250100, Jinan, China
3Department of Management Sciences, Preston University, St. 3, Sector H – 8/ 1,

44000, Islamabad, Pakistan

E-mails: [email protected] (corresponding author);
[email protected]; [email protected]

Received 12 February 2017; accepted 04 April 2017

Abstract. Green supply chain management (GSCM), a cross-disciplinary field

has grown during recent years with increasing interest from both academia and
industry. GSCM considers emphasizing environmental issues in Traditional Sup-
ply Chain Management (TSCM). Due to the new trends in global warming, en-
vironmental sustainability has become a greater concern among the organizations
and enterprises globally. This study will focus on green supply chain manage-
ment practices in the presence of green innovation. Green innovation will im-
prove organizational processes as well as products, which lead to economic and
environmental performance. Different institutional actors are putting pressures to
implement Green supply chain management practices. Population of this study is
electronics industry in Pakistan. Sample size is 500 with cluster sampling tech-
nique. Data has been collected through a survey method based on the adopted
questionnaire. The collected data will be tested through Cronbach Alpha, Descrip-
tive Statistics, Pearson Correlation, Linear Regression, Moderated Regression,
Multiple Logistic Regression and Hayes’s statistical tests to analyse the suggested
research model. This study will enable organizations to implement green supply
chain management practices to bear institutional pressure and move towards green
innovation to enhance their economic and environmental performance that were
never possible before this study.
Keywords: green supply chain management, GSCM practices, environmental per-
formance, economic performance, green innovation, institutional pressure.
JEL Classification: R41, Q52, Q53, Q55, Q56.

Copyright © 2017 The Authors. Published by VGTU Press.

This is an open-access article distributed under the terms of the Creative Commons Attribution-NonCommercial 4.0 (CC BY-NC 4.0)
license, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are
credited. The material cannot be used for commercial purposes.
 M. N. Shafique et al. The impact of green supply chain management practices on performance:
moderating role of institutional pressure with mediating effect of green innovation

1. Introduction
Balancing between environmental and economic performance getting the boost in or-
ganizations. Today, every organization is trying to fulfill their corporate social respon-
sibilities. Protection of environment became the demand of every customer and regula-
tory authorities in every country that’s why environmental protection became the main
concerned of organizations (Zhu et al. 2005; Jabbour et al. 2014). Furthermore, every
organization is getting competitive and regulatory pressure to reduce their wastage’s
pressures (Shultz, Holbrook 1999; Delmas, Toffel 2003). This environmental pressure
become increasing day by day and demand for organizations to make their strategies to
make reduce the negative impact of their products and services on environment (Chan
et al. 2016; Lewis, Gretsakis 2001).
Globalization changed organizational traditional processes and activities to green or
environmental policies. Now, organizations trying to establish their green image through
the implementations of green strategies and practices (Chen 2008; Hick 2000). Green
practices will result as the competitive advantage (Hansmann, Claudia 2001). Confeder-
ation of British Industries (CBI) had identified the main environmental factors should be
implemented in marketing to reduce risks, regulatory pressures and organizational and
environmental performance in 1994. The main regulatory issues, competitive pressure,
marketing strategies, business performance, environmental protection and operational
excellence can be achieved only the implementation of green supply chain management
practices (Hutchison 1998).
Green supply chain management is full-fledged covered the stages of the product
life cycle especially focusing on green purchasing, green manufacturing, green logis-
tics, investment recovery and cooperation with customers. Through implementation of
green supply chain management practices, organizations can achieve organizational
performance focusing on environmental, social, economic and operational performance
(Albort-Morant et al. 2016). Now, organizations are mature enough, they make strate-
gies to reduce their manufacturing cost through the reduction of wastage, and it is the
only solution to compete in the market. That is the main motivational concept for or-
ganizations to move towards green supply chain management practices to enhance their
performance (Jabbour et al. 2014; van Hock, Erasmus 2000).
The cost saving nature of environmental performance should lead to improved eco-
nomic performance, and both environmental performance and economic performance
should yield to improve operational efficiency. Environmental, economic, and opera-
tional performance generates cost savings and reflects an organization’s ability to sat-
isfy changing customer demands for environmentally sustainable products and services
(Green Jr et al. 2012). The cost and marketing implications of environmental, economic,
and operational performance should lead to improvement in the overall financial and
marketing performance within the organization (Lee, Min 2015).
Continuous and endless innovation is the only option for organizations to invent,
adopt and implement new procedures. Innovation can reduce institutional pressure, es-

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pecially customers and competitor’s pressure to enhance organizational performance

(Porter van der Linde 1995). Therefore, it is very important for organizations to adopt
green innovations in green supply chain management to enhance their value chain.
Green innovation will be caused to reduce institutional pressure and enhance environ-
mental and economic performance (Lee, Min 2015). Green innovation has distributed
into many types three of them are very famous. First, is product innovation, second is
process innovation and third is managerial innovation. All of them have same impor-
tance, and all are interlinked with each other in every organization (Li et al. 2017).
Institutional pressure is the external forces to do something or to avoid doing specific
actions by external environment customers, supplier, competitors and regulatory bodies
are the major players to insert pressure on organizations. The institutional pressure is
actually the pressure, restrictions and expectations of these bodies towards organizations
(Fikru 2016). This led three strategic isomorphisms – coercive, normative and mimetic –
to formulate the rules, norms and values in the institutional environment. This is only the
institutional environment, which will help the organizations to build or choose effective
strategies to gain competitive advantage. It may be individual strategies or set of strategies,
which will be formulated by regulatory bodies to set their bench marks to achieve highest
standards, which will lead to organizational performance (Weerakkody et al. 2016).
Traditional supply chain management is the only concern in the delivery of prod-
ucts from buyer to customer. It does not concern with society. Traditional supply chain
management did not focus on the environment. Most of the time damaged and outdated
vehicle used to supply the products. These vehicles spoiled out carbon gas as waste
from their silencers, which will cause to air pollution. In many countries, air pollution
became a very serious issue. The main causes of air pollution are outdated vehicles and
factories. This air pollution will cause to damage society and become the cause of many
diseases and deaths for humans and animals (Lee, Min 2015).
The second main problem in traditional supply chain management is high cost be-
cause damaged vehicles need more maintenance charges. They use more fuel because
these vehicles have not been modern fuel saving technology. This fuel and maintenance
cost will increase the overall expenses of organization, which will be the resultant as
to increase the product cost. Traditional supply chain management is the main cause of
high prices. In this era, every organization is fighting with their competitors based on
their cost. So, if organization faces high costs, then it is impossible to compete based
on price (Chiou et al. 2011).
Globalization created the awareness among customers, NGO’s (Non – governmen-
tal organizations) and in government organizations to protect environment. Therefore,
everyone is putting pressure on organizations to reduce their wastages and protect the
society. At the international level, different organizations have started to protect the
environment. International standard organization set standards for organizations to clean
and protect the environment. At the same time, one organization is competing with other
organizations based on corporate social responsibilities. In addition, organizations have

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 M. N. Shafique et al. The impact of green supply chain management practices on performance:
moderating role of institutional pressure with mediating effect of green innovation

realized that to protect the environment through fewer wastage, it is their corporate so-
cial responsibility. So, that’s why in recent days’ organizations facing a lot of pressure
to protect the environment (Delmas, Toffel 2003).
In this era, information communication technologies boost up in every field of life.
These technologies provide the knowledge from all over the world. Every individual,
organization and government is using this knowledge to increase their performance
(Geffen, Rothenberg 2000). Now organizations feel that their traditional methods, pro-
cesses and products cannot survive them in this hyper competitive market. Therefore,
they need to change their processes according to rest of the world. Because if they do
not change themselves, then their competitors will win the war. Therefore, every or-
ganization must have to be focused on the latest technologies to change their traditional
processes to more innovative and effective one. So, every organization is struggling to
implement new and innovative ideas, activities and processes in their organizations to
achieve high performance (Green Jr et al. 2012).
This study will focus to reduce all these problems. In this study green supply chain,
management practices will effect on organizational performance. When organizations
implement green supply chain management practices, it will reduce organizational costs
and protect the environment to protect the environment and enhance organizational
performance. The main problem statement of this study is to fine “The effect of green
supply chain management practices on performance; Moderating role of institutional
pressure with mediating role of green innovation”.
Every researcher tries to find the gap in previous knowledge and try his level best
to minimize the gap. To minimize this knowledge gap will enable a researcher for
analytical thinking and find unknown dimensions of work, which was not explored and
addressed until now. In the same manner, this study also found the gap from previous
knowledge and filled this gap in new dimensions. In this study, different types of the
gap have been addressed. The first gap of this study is based on variable. In most of
the previous study, the relationship of green supply chain management practices and
performance was analyzed and ignored the other external factors associated with this
relationship. In this study, these external factors have been considered.
The second major big gap is based on geographical area. The studies have been
analyzed in different developed countries and ignored this phenomenon in develop-
ing countries while this study is more needed in developing countries because they
have fewer strict rules regarding the environmental concerns. Therefore, this study was
conducted in Pakistan, which is a developing country. Third, this study was focused
in different industries in different parts around the world. In Pakistan, most grooming
industry is the electronic industry, especially computer and mobile industry. Therefore,
this study will be focused on computer industry segmented laptops. Fourth, the other
studies regarding green supply chain management practices and performance is based
on either qualitative or economic or mathematical modeling while this study will be

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focused on quantitative methodology based on the statistical test. Therefore, this study
also filled the methodological gap, which is very less addressed in previous studies.
In this study, following research questions should be addressed.
– RQ1: What are green supply chain management practices?
– RQ2: How green supply chain management practices will effect on organizational
performance?
– RQ3: What is the relationship between green supply chain management practices,
institutional pressure and organizational performance?
– RQ4: How green innovation plays its role between green supply chain management
practices and organizational performance?
This study is significant for both academicians and managers at the same time. In the
academic point of view, this study will fill the gap found in previous studies. Further-
more, this study will also open the new horizons for the upcoming researchers to think
about organizational performance in a new perspective. This study has developed the
direct relationship between organizational performance and green supply chain manage-
ment practices. This study is developing the indirect relationship between green supply
chain management practices and organizational performance in the presence of green
innovation and institutional pressure. These direct and indirect relationships in the same
study had not been studied previously.
This study has been also significant for managers and organizations at the same time.
Because if organizations implement this study in their organizations and adopt green sup-
ply chain management practices in their processes, then they can enhance environmen-
tal and economic performance. The implementation of green supply chain management
practices will enable organizations to bear institutional pressures, which enable them to
get the competitive advantage through corporate social responsibility of environmental
protection. At the same time, organizations will encourage green innovations to enhance
organizational performance. Therefore, this study will change traditional supply chain to
green supply chain to gain competitive advantage through innovation.
The main objectives of this research are given below.
– To find the effect of green supply chain management practices on organizational
performance.
– To explore the relationship between green supply chain management practices,
institutional pressure and organizational performance.
– To develop the novelty of effect among green supply chain management practices,
green innovation and organizational performance.

2. Literature Review and Theoretical Foundations

Green supply chain management practices impose on organizations to design, imple-
ment and produce environmental friendly products those are suitable for environmental
sustainability. The green concept is revolved throughout all stages of the product life

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 M. N. Shafique et al. The impact of green supply chain management practices on performance:
moderating role of institutional pressure with mediating effect of green innovation

cycle. Furthermore, previous study on Xerox Ltd. suggested to develop the matrix for
environmental assessment in all product life cycle stages (McIntyre et al. 1998). This
study suggested to implement environmental practices in the whole process of supply
chain and move the traditional supply chain to green supply chain practices because the
main focused of this study is environmental sustainability (Jabbour et al. 2014).
Previous study suggests in their study that a positive correlation was found between
green supply chain management and economic performance as well as environmental
performance. They suggest that if organization’s moves towards green supply chain
practices, then they will gain more profit by reducing their wastages. It is also caused
to protect environment because low wastages will cause low damage to environment.
So, green supply chain management will cause more environmental and economic per-
formance as compared to traditional supply chain management practices implemented
in organizations (Zhu, Sarkis 2004).
If buyer and seller have strong relationship with each other, then it is easy to imple-
ment green supply chain management practices in manufacturing organizations (Geffen,
Rothenberg 2000). Another study supports this study and enhanced this effect as green
multiplier effect encouraged an organization to buy raw material from second or third tie
supplier who implemented green practices in their produce design. So, it will motivate
organizations towards green purchasing (Preuss 2001).
Green supply chain management policies force the organizations to towards green
purchasing. These green purchasing will improve organization’s economic performance
as well as these policies and green purchasing increase environmental performance
(Green et al. 1998). If organizations buy green products, then they also produce green
products. Furthermore, studies suggest that green supply chain management practices
are composed on green purchasing, eco design, cooperation with customers and invest-
ment recovery are the major factors to analyze green supply chain management prac-
tices in organizations to boost up their performance (Jabbour et al. 2014).
Environmental performance can enhance through the implementation of eco design
during production (Diabat, Govindan 2011). Eco – design does not mean to reduce the
functionality or cost of product. The main purpose of this design is to investment recov-
ery through the reuse of products repeatedly It will directly reduce remanufacturing cost
as well as the cause to reduce the wastage. So, eco – design directly effect on economic
and environmental performance. Furthermore, eco-friendly designs are more attractive
for customers to buy and use product (Miroshnychenko et al. 2017).
Economic performance is directly effected through green supply chain practices.
Because the concept of green supply chain management is to protect the environment
through the reduction of wastages. The reduction in wastages should lead to reduce in
cost, and cost is directly interlinked with economic performance. The organizations
those can produce at low cost these can enhance their economic performance (Sun
et al. 2017). It has been developed this positive relationship between organizational
performance and green supply chain management practices. Furthermore, they suggest

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that organizations can gain competitive advantage through the implementation of green
supply chain management practices in organizations (Rao, Holt 2005).
Institutional pressure is the function of institutional actors to moderate organizational
characters to develop their strategies to protect environment. The major institutional
actors those are customers, competitors, political, social, religious, local communities,
international communities, market and regulatory organizations (Wu et al. 2012). All
organizational stakeholders force the organizations to do coercive actions in specific
conditions for environmental sustainability. Organizations perceived that they have to
face institutional pressure, which will influence on their strategic decisions (Tingey-Ho-
lyoak 2014). Organizations cannot take decisions without considering the institutional
pressure. Now, everyone is demanding from organizations to develop their strategies
environmental friendly to enhance organizational performance (Seles et al. 2016).
Legislation authorities and political parties in every country is putting pressure on
organizations to move towards green supply chain management to protect their envi-
ronment. Every country has developed some rules and regulations for organizations to
formulate their environmental policies according to these rules (Li et al. 2017). Further-
more, every organization knows that government is the key stakeholder. Therefore, that
is why organizations have to obey the rules and regulations of authorized organizations.
These national and international organizations use their power to control and correct
organizational procedure those will match with already set environmental standards.
Legislation and political power are the most important institutional pressures for or-
ganizational processes (Majundar, Marcus 2001).
Customers and competitors are the major factor to putting pressure on organizations.
Both customers and competitors are considered as institutional pressure. They can demand
for organization to go towards green practices and request from political and legislator
actors about environmental sustainability. Now, organizations respond according to cus-
tomers’ requirements because they have realized if they did not satisfy customer’s require-
ments, then their competitors get competitive advantage and get their customers (He et al.
2016). Therefore, organizations develop their green strategies to fulfill customer’s require-
ments. In most of the organizations, environment management system has adopted. This
system gives the guidelines according to ISO 14001 standards for environmental manage-
ment (Christmann, Taylor 2001). So, if organization did not fulfill these standards, then
their competitor will gain ISO 14001 certifications through the adoption of green practices
and gain competitive advantage through environmental and economic performance, which
will build institutional pressure on organization (Khanna, Anton 2002).
Green innovation is the same as technological innovation like software and hardware
innovation. Green innovation is divided into product innovation and process innovation.
But the main theme of green innovation is to protect the environment through recycling
energy saving, green purchasing, green production, eco design, waste and pollution
reduction (Chen et al. 2006). Organizations can adopt green innovation through the
implementation of new hard ware and software, which will lead to enhance organiza-

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moderating role of institutional pressure with mediating effect of green innovation

tional environmental and economic performance. So every organization tries to adopt

green innovation based on green process innovation and green production innovation
to enhance their organizational performance (Chiou et al. 2011).
Green product innovation is the factor of green innovation. The focus of green prod-
uct innovation is green purchasing, eco-design and green manufacturing of product. This
will lead to reduction in the waste of raw material, environmental protection and saving
in energy. The green product innovation can be measured through four factors. The first
factor of green product innovation is that organizations develop the strategies for less
consumption of raw material during product design and development (Fei et al. 2016).
The second important factor of green product innovation is that organizations must con-
sider the consumption of energy. The product must consumer fewer amounts of energy
when it is in working condition. The third important factor of green production innova-
tion is that organizations should make strategy that product must be composed of fewer
amounts of material. The fourth and most important factor of product innovation is that
product should be recycled (Chiou et al. 2011). It means organization can decompose
the product easily and then manufactures again by using the same material. The product
design should be environment friendly. So organizations should involve in green product
innovation to enhance their environmental and economic performance (Sun et al. 2017).
Green process innovation is to implement new and innovative processes in organiza-
tions to achieve organizational goals. The green process innovation is focused on the pro-
cesses to save energy during production and other organizational processes (Dai, Zhang
2017). Furthermore, green process innovation also encourages organizations to recycle
their waste to prevent environment. The implementation of green process innovation will
cause the reduction of toxic materials and reduce the waste. When organizations spoil
less waste then it will cause to reduce environmental performance (Geffen, Rothenberg
2000). So, green process innovation is directly the effect on environmental and economic
performance because less waste reduces production cost (Jakobsen, Clausen 2016).
Green process innovation effect on organizational performance through four ma-
jor aspects. The first component of green process innovation that organizations must
adopt green process during manufacturing. Organization should focus to reduce the
emission of toxic materials during production effectively (Lee, Min 2015). The second
major component of green process innovation is that organizations should be focused
to reuse and recycle their products to reduce waste and hazard’s emissions (Chen et al.
2006). Furthermore, third major factor should consider during the process innovation is
that organizations should focus to reduce consumption of electricity, water and coal or
oil resources during their working (Jakobsen, Clausen 2016). The fourth major factor
should consider for green innovation is that organizations should develop their policies
to reduce raw material during manufacturing process. So, by the implementation of
these four factors organizations should adopt green process innovation to enhance their
organizational performance (Zailani et al. 2015). Some theories related to this study are
summarized and mentioned in the below Table 1.

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Table 1. Supportive theories (source: created by authors)

Theory Description Link with this study

Transaction- Transaction cost theory is based on some The purpose of innovation
cost economics assumption regarding to governance those reduces cost and time to
(TCE) describe the effect of internal and external enhance performance.
transactions. This theory is advancement Therefore, green innovation
of agency theory. Because this theory is in this study supported this
different from contractual relationship with theory.
shareholders (Kaplan Financial Knowledge
Bank 2012; McClelland, O’Brien 2011).
Social exchange Social exchange theory based on the balance In this study, Green
theory (SET) between give and take among all relations. supply chain management
Because everyone weights his benefits and practices will effect on the
costs to maintain their relationship with relationship between buyer
others. If the cost and benefit are in the equal and seller. Both parties gain
ratio, then they can sustain their relationship. benefits from each other.
So, it is the rational choice to develop the Therefore, it will support
relationship (Cropanzano, Mitchell 2005). social exchange theory.
Resource-based Resource-based view to identify and analyze In this study, Green supply
view (RBV) organizational resources and capabilities chain management enables
to develop their strategies based on their organizations to understand
assets to gain competitive advantage. and analyze their assets
When organizations know their resources effectively and make their
and capabilities then they also realize procedure easy to gain
their strengths and weaknesses. When competitive advantage.
organizations know their capabilities, Normally, organizations use
then they can make good strategy to win software for supply chain
competitive advantage (Fikru 2016; Business management those can
Dictionary 2017; Rivard et al. 2006). provide different required
reports.
Systems theory System theory is actually the interlink In green supply chain
among all the set of activities and processes management, all activities
to achieve a common goal. This is also like inventory, purchasing,
interlinking among internal organizational suppliers and customers are
resources like humans, machine and interlinked with each other
environment to interact with each other has to enhance organizational
and enhance organizational performance. performance in this study.
Therefore, it starts from the input resources
of organization. Then organizations do
some processes on these inputs to produce
some output under certain environmental
conditions (Environment and Ecology 2017;
Bronfenbrenner 1992).
Network theory focuses on the relationship Green supply chain
Network theory between buyer and seller or direct or management practices
indirect relationship between organizations. are not isolated these are
Furthermore, this theory also engaged different interlinked with different
organizational networks to do some specific network actors like
tasks with the help of each other to transfer suppliers and customers.
and transform their organizational resources Therefore, this study will
(Moliterno, Mahony 2011; Chaston 2015). support network theory.

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moderating role of institutional pressure with mediating effect of green innovation

End of Table 1.

Theory Description Link with this study

Contingency Contingency theory suggests becoming Institutional pressure and
theory flexible according to situation. Because there green innovation are not
is no single theory, which is good every time. constant. They are rapidly
Therefore, in this technological rapid change changing. Therefore,
environment organization should be flexible organizations need to
enough to design, control and select their align their practices with
systems according to environment. And must institutional pressure and
be flexible and adopt changes (Stonebraker, innovation to enhance their
Afifi 2004). performance. That is why
this study will support
contingency theory.
Institutional The diversity of both the institutions driving In this study, the moderating
Theory environmental pressures, including external variable institutional
and internal pressures to the organization and pressure supported this
the corresponding organizational responses theory.
developed within each company (He et al.
2016; Wu et al. 2012).

Institutional Pressure

GSCM Practices Performance

Green Innovation

Fig. 1. Conceptual model (created by authors)

Based on literature review and conceptual model mentioned in Figure 1, following

hypotheses have been formulated.
– H1: Green supply chain management practices is positively effect on organizational
performance.
– H2: Institutional pressure plays the moderated role between green supply chain
management practices and organizational performance.
– H3: Green innovation plays the moderated role between green supply chain man-
agement practices and organizational performance.

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3. Methodology
Methodology is the overall process which is based on the interlinked set of activities to
complete any study. The nature of study is quantitative. In this study, deductive research
approach is used because in this study, hypotheses have been developed as the basis
of literature review and theories. These hypotheses will direct the research model. The
conceptual model develops the relationship between variables. This relationship has
been tested through data by using different statistical tests. The results of these tests
shows prove the relationship and then generalized these results to other industries. In
this study, data has been collected through survey method based on the adopted ques-
tionnaire. Population of this study is the electronic industry in Pakistan. Sample is the
subset of population. In this study cluster, random sampling method have been used to
collect data. The first cluster of this study is computer/laptop industry from electronic
industry. Both wholesaler and retailer have been taken in this study. The second cluster
is that researcher choose five brands, i.e. DELL, Apple, Lenovo, HP and Acer among
all brands of laptops. The sampling size is 500.
In this study, researchers find the gap from current situation facing by society. Then
download different latest research papers from different data bases. These research pa-
pers provide current knowledge around the world. Then researchers find some theories
regarding to current research and interlink these theories to current situation. Further-
more, latest research papers have provided directions for the new researchers. So, it will
be checked and take a guideline from them. NVIVO 11 is used for qualitative analysis
part, especially in literature review part of this study. After that scale, items have been
adopted to measure the phenomena. A complete questionnaire is prepared and then
distributed among samples and collected responses on Likert scale. Then these results
have been coded from 1 to 5 from strongly disagree to strongly agree.
The coded data of each response have been entered in to SPSS 21 software for
further analysis. Then different statistical tests have been used through SPSS software.
The result from these tests was interpreted in this study. Furthermore, based on these re-
sults, the study will be generalized and some conclusions have been drawn. For writing
the report MS Word 2016 is used. Furthermore, to check grammatical mistake’s white
smoke software will be used in this study. Reference is the most technical part of this
study. Researchers used Endnote X7 software for automatic references.

4. Results and interpretations

In this study, data has been collected through survey method and analyzed with dif-
ferent statistical tests by using SPSS software. The results from these tests have been
mentioned here with their interpretations.
The above-mentioned Table 2 shows mean, standard deviation, correlation and reli-
ability of variable based on survey data. Mean is the central value of respondent or the
most favorable trend. The mean value from three shows the neutral view and more than

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moderating role of institutional pressure with mediating effect of green innovation

Table 2. Means, standard deviations, correlations, and reliabilities (N = 433)

Variables Mean S.D GSCM IP GI Perf.

GSCM Practices 3.09 1.024 (.969)
Institutional Pressure 2.87 .947 .883** (.926)
Green Innovation 3.68 1.304 .852** .861** (.920)
Performance 3.04 1.013 .927** .908** .894** (.958)
**. Correlation is significant at the 0.01 level (2-tailed).
Reliability estimates in parentheses.

shows, the agree with phenomena. In addition, less than three shows disagree behavior.
Means values of green supply chain management, green innovation and performance
shows agree behavior while the value of institutional pressure shows the tendency to-
wards neutral. The standard deviation value shows the deviation from the mean point
all the values are close to zero, which mean very less deviation behavior from the mean
point. Moreover, the values of Pearson’s correlation are high and significant, which
shows each variable has the correlation with other variables. Furthermore, the values of
Crona Bech Alpha test showed the reliability of data. All the values are highly reliable
and data is acceptable for further analysis.
Table 3. regression between green supply chain management practices and performance (N = 433)

Model R2 β t Sig.
Green Practices .860 .927 51.437 .000
Dependent variable: performance
The above Table 3 shows the effect of green supply chain management practices
on organizational performance through the regression test. The value R2 of shows the
effect of independent variable on dependent variable. In the above table, value of R2
is .86. It means that the change in green practices will bring the 86% change in perfor-
mance. Moreover, the value β of shows the standardized coefficient. It means the effect
on dependent variable is only due to the independent variable. The value of β is .927.
It means that 92.7% change in performance is only due to green practices. The value
of t shows the difference. In the table, value of t is 51.437. The significant or p value
is .000. All the values are in the acceptable range at the significant level. Therefore, the
result shows green supply chain management practices effecting 86% on performance.
Table 4: Moderated regression among GSCMP, perf. and IP (N = 433)

Model R2 β t Sig.
Green Practices .860 .927 51.437 .000
Int (Perf. * IP) .896 .975 29.468 .000
Dependent variable: performance

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The above Table 4 shows two regression models. The first model described the direct
effect of independent variable of green supply chain management practices on depend-
ent variable of organizational performance. While in the second model, the interaction
effect has been analyzed. The interaction term is the combined effect of independent
and moderated variable on dependent variable. The change in values of R2 of shows
when moderated variable is added then dependent variable is more effected. When only
green practices are effected on performance then the value of R2 is .860 after adding
moderating variable through the interaction term this value increased up to .896, which
showed moderation will enhance the effect on performance. In addition, the value β of
shows the standardized coefficient. The value β change from .927 to .975. The change
in value β of shows when moderated variable is added then de-pendent variable is the
only effect due to independent and moderated is increased. The value of t shows the
difference; the t value is also changed from 51.437 to 29.468. When moderated variable
is effected then difference will be decreased. Both models are at the highly significant
level, which is shown by significant, or p value .000. So, these results show moderated
variable is effecting positively on dependent variable.
Table 5. Hayes Mediation among GSCMP, Perf. and GI (N = 433)

Model Coefficient Standard error t Sig.

Green Innovation .2943 .0227 12.9689 .000
Green Practices .5979 .0289 20.6798 .000
Dependent variable: performance
The above Table 5 shows the mediation effect of green innovation between independent
variable green supply chain management practices and performance. The Hayes model 4
is used to find the mediation effect through Hayes’s plug-in for SPSS. The value of a coef-
ficient shows the effect of independent variable of green practices and mediating variable
green innovation. Both variable effects are calculated separately. If it is required to find the
combined effect of independent and mediating variable, then just have to sum these values.
The standard error shows the value of error, and it is analyzed the mediating variable green
innovation has low standard error. The value of t shows difference and the value of t is less
for mediating variable. Both values are at the highly significant level. Therefore, these values
showed that green innovation plays mediation effect between green supply chain manage-
ment practices and performance.

5. Conclusions
This study is concluded hypothetically. Because this study has developed a relationship
between green supply chain management, institutional pressure, green innovation and
organizational performance. This relationship has been analyzed through spearman cor-
relation statistical test. Furthermore, regression test is used to find the effect of green

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moderating role of institutional pressure with mediating effect of green innovation

supply chain management practices on organizational performance. The result of this

regression test is in the favor of first hypothesis at the significant level. Therefore, the
first hypothesis of this study, “green supply chain management is positively effecting
on organizational performance” have been proved and accepted.
Second hypothesis of this study is “Institutional pressure play moderated the effect
between green supply chain management and organizational performance” was tested
through regression and moderated regression, and it has been proved by results from
these tests at the significant level. The third and last hypothesis of this study is “Green
innovation plays mediating effect between green supply chain management practices
and organizational performance.” This hypothesis was tested through Hayes’s model
4 for mediation, and the direct and indirect effect was analyzed and proved at the
significant level. So, this hypothesis is also proved. The overall model of this study is
accepted and proved.
Limitations are the restrictions or boundaries faced by a researcher during the whole
study. Based on these limitations, researchers recommend some suggestion as future
direction for the upcoming researchers in this field. The first limitation is variable based.
This study focused only four variable green supply chain management practices, institu-
tional pressure, green innovation and organizational performance while other variables,
i.e. decision support system, organizational structure and organizational strategies ef-
fecting on performance but these variables had been ignored in this study. The second
limitation in this study is based upon geographic location. This study focused only on
Pakistan while further studies can be workable on different geographic areas. The third
limitation in this study is based on sector or industry based. This study only focused on
electronic industries while further studies can do on different sectors like construction
and manufacturing sector. The other limitations for data collection respondents are very
busy. So, in future research take appointment before to visit to respondent and go in
their free schedule.
This study can implement in both academician and managerial level. In manage-
rial point of view, this study can be implantation in organizations to strengthen their
supply chain management channel through new concepts and processes to enhance
innovation and performance. This study will be implemented in electronic industry in
Pakistan to enhance their performance. Furthermore, this study can implement outside
the Pakistan and in different sectors like construction and health sector. In academic
point of view, this study can new open doors and dimensions to the field of green
supply chain management, institutional pressure, green innovation and performance
for the new researchers to do more work. Therefore, this study had practical imple-
mentation in both sides.

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Muhammad Nouman SHAFIQUE is doing his Doctor of Philosophy (PhD) in Business Administration
from Dongbei University of Finance and Economics, China. Previously, he did his Master of Philosophy
(M.Phil) in Business Administration from Pakistan. He achieved distinctive accomplishments from differ-
ent international institutes. Furthermore, he has published many research papers in different international
journals. He also participated in different conferences to present and learn new methods and techniques
and trends in research.

Muhammad Shahid ASGHAR is doing his Master of Philosophy (M.Phil) in Project Management from
Shandong University Jinan, China. Previously, he did his Bachelor of Technology in Electronics & Com-
munication from University of Engineering & Technology Lahore, Pakistan. He also had the opportunity to
study a number of subjects in the humanities and they have been both enjoyable and enlightening, providing
me with a new and different perspective on the world in which we live.

Dr. Haji RAHMAN, a man of ambitions to take the challenges in his field. He remained a hardworking
human with an excellent academic career. He did his MS in Engineering Management from UET, Taxila,
Pakistan and PhD in Management Sciences (HRM) from Preston University, Islamabad on HEC scholar-
ships. He is the author of a number of international and national research papers. He has also presented
his research articles in a number of international research conferences. He worked as faculty member for
more than 9 years at the Ghulam Ishaq Khan Institute with best result producing teacher awards. He is
now associated as Assistant Professor with Preston University, Islamabad campus. Preston University has
awarded him the Punctuality and Efficiency Awards for Fall Semester 2015, Spring Semester 2016 and
Fall 2016. He is also a visiting faculty member at the IIUI, Islamabad and Federal Urdu University of Arts
Sciences and Technology, Islamabad. He also delivered trainings modules at CDA Training Academy and
Pakistan Manpower Institute, Islamabad.

108