Despite the rising interest in environmental strategies, few studies have examined how managerial cognition of such strategies influences actual innovation capability development. Taking a managerial cognition perspective, this study investigates how managers’ perceptions of institutional pressures relate to their focus on proactive environmental strategy, which in turn affects firms’ realized innovation capability. The findings from a primary survey and three secondary datasets of publicly listed companies in China reveal that managers’ perceived business and social pressures are positively associated with their (...) focus on proactive environmental strategy, which consequently fosters innovation capability development. Moreover, state ownership and government administrative control weaken the impact of managerial focus on proactive environmental strategy on innovation capability. These findings have important implications for how managerial cognition supports environmental strategy and organizational capability building under the influence of institutional pressures and government intervention. (shrink)

Drawing on institutional and signaling theories, this study examines how environmental corporate social responsibility affects firm performance in a dysfunctional institutional environment. We extend the ECSR literature by suggesting that ECSR indirectly influences firm performance through the mediating effects of business and political legitimacy. Based on a dataset of 238 firms in China, we find that ECSR affects business and political legitimacy followed by firm performance. Moreover, legal incompleteness weakens and legal inefficiency strengthens the effects of ECSR on business and (...) political legitimacy. (shrink)

Despite the prevalent role of guanxi in conducting business in Chinese, it is unclear whether interpersonal guanxi fosters interfirm trust. Taking a contingency approach, this study examines how institutional (government–market relationship and Buddhism influence) and individual (relative role performance and the span of partner control) factors moderate the association between interpersonal guanxi and interfirm trust. Based on a paired survey between salespersons and sales managers and two secondary datasets, this study finds that interpersonal guanxi is positively associated with interfirm trust. (...) Moreover, this positive effect is stronger when firms operate in regions with strong government–market relationships and strong Buddhism influence. In addition, the positive relationship is weaker when guanxi resides in boundary spanners who have relatively high role performance, but becomes stronger when boundary spanners have a broad span of partner control. These findings highlight the situations in which guanxi at an interpersonal level is more or less likely to foster interfirm trust. (shrink)

Despite the prevalent role of guanxi in conducting business in Chinese, it is unclear whether interpersonal guanxi fosters interfirm trust. Taking a contingency approach, this study examines how institutional and individual factors moderate the association between interpersonal guanxi and interfirm trust. Based on a paired survey between salespersons and sales managers and two secondary datasets, this study finds that interpersonal guanxi is positively associated with interfirm trust. Moreover, this positive effect is stronger when firms operate in regions with strong government–market (...) relationships and strong Buddhism influence. In addition, the positive relationship is weaker when guanxi resides in boundary spanners who have relatively high role performance, but becomes stronger when boundary spanners have a broad span of partner control. These findings highlight the situations in which guanxi at an interpersonal level is more or less likely to foster interfirm trust. (shrink)

Despite the growing importance of stakeholder management, few studies have empirically examined the influence of stakeholder relationship capability on firm innovation, especially in emerging economies. This study investigates how SRC relates to firm innovation in the presence of governmental intervention and in combination with firm-level characteristics. Using a survey and multiple secondary datasets on the listed Chinese firms, our findings indicate that SRC is positively associated with firm innovation. Moreover, advanced legal development and high-tech status strengthen the positive link between (...) SRC and innovation, whereas state ownership and firm age weaken this relationship. These findings provide novel insights into how firms use stakeholder management to enhance innovation that is beneficial for economic growth. (shrink)

Building on the co-evolutionary perspective, this study investigates the reciprocal and co-evolving relationship between political ties and green innovation in the presence of institutional and environmental changes. Using panel data for Chinese listed private firms for a sample period that runs from 2013 through 2016, our findings indicate that political ties have an overall positive impact on green innovation. Moreover, political ties and green innovation mutually reinforce each other in less developed regions or heavily polluted areas; however, green innovation discourages (...) the formation of political ties in regions with high levels of institutional development or less environmental pollution. These findings provide novel insights into the co-evolution of and co-alignment between political strategy, green innovation, institutions, and environments in emerging economies. (shrink)

Given that services differ from goods in terms of intangibility, heterogeneity, and inseparability, customers may evaluate green services differently from how they evaluate green goods. Previous research has investigated customers’ perceptions and purchase decisions regarding green products. However, limited attention has been paid to the impact of green practices on customer evaluations of the service experience as well as important contingencies that bear on this relationship. Drawing on stakeholder theory, our study examines the impact of green practices on customer evaluations (...) and further considers the influences of environmental- and firm-level contingencies. We test our model with a multi-source dataset in the Chinese hotel industry. The findings indicate that green practices improve customer evaluations of the service experience. This positive impact is, however, weaker in external environments characterized by high internet penetration and market complexity but is stronger for hotels with innovative services and for business hotels. Our findings provide novel insights into the environmental ethics and stakeholder management literatures by revealing the role of green practices in promoting positive service evaluations as well as the contingent influences of external environments and internal firm-level characteristics. (shrink)