From Covid-19 to conflict: Does environmental regulation and green innovation improve industrial sector decarbonization efforts and environmental management?

• DOI: 10.1016/j.jenvman.2023.118567
• Publication Date: 2023-07-14T17:05:41Z
• Authors: Hashim Zameer; Muhammad Shahbaz; Andreas Kontoleon
• Keywords: Green innovation; Porter hypothesis; Environmental Scanning; Industrial Production; Environmental crisis

During the COVID-19 period, industrial production was slowed or halted due to COVID restrictions and lockdowns, followed by global tensions and conflicts, which created uncertainties for industrial production. Similarly, during this period, the growth in carbon emissions was seen shrinking. However, it is greatly important to explore whether this shrinking trend will continue or whether a new growth pattern could emerge. Considering this, the research was carried out to investigate the relationship between green innovation initiatives and environmental regulations in the process of environmental management and environmental performance in the industrial sector. To do so, the survey-based research methodology using PLS-SEM was adopted, and data was gathered from 279 managers working in the equipment manufacturing industry. Our empirical findings revealed that environmental regulation and green innovation efforts strengthen decarbonization efforts, which further improve environmental management and environmental performance. The mediating role of decarbonization efforts was found to be prominent among green process innovation, environmental management and environmental performance. Moreover, decarbonization serves as a mediator between green product innovation and environmental management. In contrast, we could not verify that decarbonization mediates the relationship between green product innovation and environmental performance. The key findings are greatly important and provide a fresh roadmap for environmental management in the post-COVID era.