Green Supply Chain Management and Sustainable Performance: The Mediating Role of Innovation and Institutional Pressures

Abstract

Green Supply Chain Management (GSCM) has emerged as a strategic approach for improving environmental, economic, and social performance in organizations. This study examined the impact of GSCM on sustainable performance with the mediating roles of innovation and institutional pressures. A quantitative research design was applied using a cross-sectional survey approach. Data were collected from employees working in manufacturing and supply chain-related firms in Pakistan, particularly in textile, logistics, pharmaceutical, and food processing sectors. A total of 350 questionnaires were distributed, and 312 valid responses were analysed. Structural Equation Modelling (SEM) using Smart PLS was employed to test the proposed hypotheses. The results indicated that GSCM significantly influenced sustainable performance (β = 0.31, p < 0.001). Innovation showed a significant mediating effect between GSCM and sustainable performance (β = 0.21, p < 0.001), while institutional pressures also demonstrated a significant mediating role (β = 0.18, p < 0.001). Additionally, innovation positively influenced sustainable performance (β = 0.36, p < 0.001), and institutional pressures significantly enhanced sustainable performance (β = 0.33, p < 0.001). The findings confirmed that sustainable performance improved when GSCM practices were supported by innovation capabilities and institutional compliance mechanisms. The study contributes to resource-based and institutional theories by explaining how internal and external factors jointly enhance sustainability outcomes. Practical implications suggest that organizations should integrate green innovation and respond effectively to institutional pressures to achieve long-term sustainability advantages.

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