The impact of green innovation initiatives on competitiveness and financial performance of the land transport industry

The transportation sector is one of the primary contributors to greenhouse gas emissions that have deteriorating effects on the state of the environment. The implementation of sustainable practices has become one of the most challenging tasks of organizations at present. This study examined the effect of implementing green innovation initiatives on a firm's competitiveness and financial performance of motor vehicle companies in the Philippines. Data were gathered through an online survey questionnaire with a total of 206 respondents composed of employees of various ranks working in companies engaged in the manufacture, distribution, retail, and service of motor vehicles. The theoretical framework presented a hierarchical latent variable model which was validated using the partial least square structural equation modelling (PLS-SEM). The model fit, measurement, general construct fit, discriminant validity, and structural model parameters were examined and found to have acceptable values. The findings indicated that environmental regulations, market demand, government pressure, competitor pressure, corporate social responsibility, and employee conduct were the significant drivers of green innovation initiatives. The study also revealed that the implementation of green innovation initiatives positively affects the firm's competitiveness and financial performance. Motor vehicle companies and other types of organizations are encouraged to demonstrate not only their concern for society or community but also their concern for the environment to acquire better market leverage and financial position.