Pressure or premium: what works best where? Antecedents and outcomes of sustainable manufacturing practices

Abstract

In this study, we empirically test the antecedents and consequences of sustainable manufacturing practices across emerging as well as developed countries such as India, China and OECD. We use data from the sixth edition of International Manufacturing Strategy Survey (IMSS) and partial least squares structural equation modelling (PLS-SEM) to test our conjectures. Our findings suggest that while customer willingness to pay has a significant impact on sustainable manufacturing practices everywhere, stakeholder pressure is able to influence their adoption in OECD and India, but not in China. We also find that firms that are high on sustainable manufacturing practices not only reap sustainability benefits, but also derive cost reduction and quality improvement in many contexts. However, this relationship between sustainability efforts and operational performance is mediated through sustainability performance.

Keywords:

• sustainable manufacturing
• green manufacturing
• stakeholder pressure
• customer willingness to pay
• cost performance
• quality performance

Disclosure statement

No potential conflict of interest was reported by the authors .

Notes

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5 We define sustainability efforts as a combination of environmental and social sustainability efforts and sustainability performance as a combination of environmental and social sustainability performance.

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13 We used the information on plant headquarters to identify whether a firm is an MNE or not. If the headquarters of the plant surveyed was different than the country in which the plant was located, we coded the response as 1 (MNE) and 0 otherwise. There were a total of 118 MNE responses out of 647 valid responses.

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Additional information

Funding

This work was supported by Indian Institute of Management Bangalore [Research Seed 22072].