Institutional pressures, green supply chain management practices on environmental and economic performance: A two theory view

Abstract

The adoption of green practices within and outside organizational boundaries is imperative to ascertain environmental and economic performance goals. This article examined whether internal and external green supply chain management (GSCM) practices have the same or different kinds of regulatory, market, or competitive pressures. We employed institutional theory to identify different kinds of pressures, and resource dependence theory to explore the impact of internal and external GSCM practices on performance. An empirical study was conducted by collecting data through a structured questionnaire administered in Pakistan to the executives in the manufacturing industry. A total of 207 responses were used for data analysis by employing the partial least squares structural equation modeling (PLS-SEM) method. Normative pressures were found to be the most significant in both internal and external GSCM practices, while coercive and mimetic pressures positively affected internal and external GSCM practices, respectively. Internal GSCM practices proved to be more significant in improving environmental performance, and also had a substantial impact on external GSCM practices. In contrast, External GSCM practices had a significant positive effect on economic performance, while environmental performance also contributed to improving economic performance. The theoretical and managerial implications are discussed for academics, policymakers, and industry practitioners. © 2018 by the authors.