Beyond Green Intentions: How Green Dynamic Capability and Green Intellectual Capital Drive Environmental Performance
Keywords:
green dynamic capability, green intellectual capital, green performance, environmental performance, sustainability management
Abstract
This study examines how green dynamic capability and green intellectual capital shape environmental performance in listed firms. The argument is grounded in dynamic capabilities theory and the natural resource-based view, which together explain that firms need both the ability to adapt and the knowledge base to sustain environmental improvement. The study uses a quantitative approach design and draws on survey responses from top management team members of firms listed on the Indonesia Stock Exchange. The analysis focuses on whether adaptive green capability and environmentally oriented intellectual resources can directly strengthen firm-level environmental performance. The findings indicate that green dynamic capability helps firms improve environmental performance by enabling them to detect environmental change, respond more quickly, and realign operations with green priorities. The results also show that green intellectual capital supports environmental performance by embedding environmental knowledge in people, organizational systems, and external relationships. This study contributes to the literature by offering a clear and focused explanation of how capability renewal and green knowledge resources work as complementary drivers of environmental performance. It also provides practical guidance for executives, sustainability managers, and listed firms that seek to turn environmental commitment into consistent operational outcomes.
References
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Franco, J. D. A. B., Junior, A. F., & Battistelle, R. A. G. (2024). Dynamic capabilities: Unveiling key resources for environmental sustainability and economic sustainability, and corporate social responsibility towards sustainable development goals. Resources, 13, 22.
Hair, J. F., Black, W. C., Babin, B. J., & Anderson, R. E. (2019). Multivariate Data Analysis (Eighth). Cengage Learning EMEA. https://doi.org/10.5117/2006.019.003.007
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Harun, M. D., Hogset, H., & Mwesiumo, D. (2023). Dynamic capabilities and sustainability performance: Exploring the moderating role of environmental dynamism in the Norwegian fishing industry. Sustainable Development, 31, 2636–2655. https://doi.org/10.1002/sd.2536
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Martínez-Falcó, J., Sánchez-García, E., Marco-Lajara, B., & Lee, K. (2024). Green intellectual capital and environmental performance: Identifying the pivotal role of green ambidexterity innovation and top management environmental awareness. Journal of Intellectual Capital, 25(2–3), 380–401. https://doi.org/10.1108/JIC-08-2023-0193
Martínez-Falcó, J., Sánchez-García, E., Marco-Lajara, B., & Visser, G. (2025). The influence of green intellectual capital on competitive advantage: A mediation analysis in Spanish wineries. Journal of the Knowledge Economy, 1–30. https://doi.org/10.1007/s13132-025-02811-9
Prieto, M. del C. P., Vallejo, R. C., & Ruiz-Fuensanta, M. J. (2026). Turning green into gold: The impact of green intellectual capital on performance in European firms. Business Strategy and the Environment, 0, 1–14. https://doi.org/10.1002/bse.70629
Qiu, L., Jie, X., Wang, Y., & Zhao, M. (2020). Green product innovation, green dynamic capability, and competitive advantage: Evidence from Chinese manufacturing enterprises. Corporate Social Responsibility and Environmental Management, 27(1), 146–165. https://doi.org/10.1002/csr.1780
Ramadana, M., Masnita, Y., Yusran, H. L., & Jurnali, T. (2025). Green intellectual capital and innovation: Keys to sustainable environmental performance in Manufacturing. International Journal of Scientific Research and Management, 13(04), 8788–8799. https://doi.org/10.18535/ijsrm/v13i04.em12
Singh, S. K., Giudice, M. Del, Jose, C., Jabbour, C., & Latan, H. (2022). Stakeholder pressure, green innovation, and performance in small and medium-sized enterprises: The role of green dynamic capabilities. Business Strategy and the Environment, 31(1), 500–514. https://doi.org/10.1002/bse.2906
Taamneh, A., Taamnh, M., Haija, A. A., & Almutairi, O. (2026). The impact of corporate social responsibility on environmental sustainability in the hospitality sector through green human resource management and organizational climate. Discover Sustainability, 7, 295.
Teece, D. J. (2007). Explicating dynamic capabilities: The nature and microfoundations of (sustainable) enterprise performance. Strategic Management Journal, 28(October), 1319–1350. https://doi.org/10.1002/smj
Teece, D. J., Pisano, G., & Shuen, A. (1997). Dynamic capabilities and strategic management. Strategic Management Journal, 18(7), 509–533. https://doi.org/10.1057/978-1-349-94848-2_689-1
Wang, J., & Zhang, N. (2026). Green innovation and ESG performance: The mediating role of dynamic capabilities in driving sustainable growth. Development and Sustainability in Economics and Finance, 9(368), 100113. https://doi.org/10.1016/j.dsef.2025.100113
Wang, L., Zhang, Z., Cui, S., & Zhu, H. (2025). Green human resource management and corporate environmental performance: The mediating role of corporate reputation and green dynamic capability. Asia Pacific Journal of Human Resources, 63(2), e70000. https://doi.org/https://doi.org/10.1111/1744-7941.70000
Wang, X., Kim, J., Kim, J., & Koh, Y. (2024). Application of natural-resource-based view to nature-based tourism destinations. Sustainability (Switzerland), 16, 2375. https://doi.org/10.3390/su16062375
Xiaoyi, Z., Yang, H., Kumar, N., Bhutto, M. H., Kun, W., & Hu, T. (2023). Assessing Chinese Textile and Apparel Industry Business Sustainability: The Role of Organization Green Culture, Green Dynamic Capabilities, and Green Innovation in Relation to Environmental Orientation and Business Sustainability. Sustainability (Switzerland), 15(11). https://doi.org/10.3390/su15118588
Xing, X., Liu, T., Shen, L., & Wang, J. (2020). Linking environmental regulation and financial performance: The mediating role of green dynamic capability and sustainable innovation. Sustainability, 12, 1007.
Yong, J. Y., Yusliza, M. Y., Ramayah, T., Farooq, K., & Tanveer, M. I. (2023). Accentuating the interconnection between green intellectual capital, green human resource management and sustainability. Benchmarking, 30(8), 2783–2808. https://doi.org/10.1108/BIJ-11-2021-0641
Yu, D., Tao, S., Hanan, A., Ong, T. S., Latif, B., & Ali, M. (2022). Fostering green innovation adoption through green dynamic capability: The moderating role of environmental dynamism and big data analytic capability. International Journal of Environmental Rexearch and Public Health, 19, 10336.
Yusliza, M. Y., Yong, J. Y., Tanveer, M. I., Ramayah, T., Noor Faezah, J., & Muhammad, Z. (2020). A structural model of the impact of green intellectual capital on sustainable performance. Journal of Cleaner Production, 249, 119334. https://doi.org/10.1016/j.jclepro.2019.119334
Zhang, J., Ouyang, Y., Philbin, S. P., Zhao, X., Ballesteros-pérez, P., & Hui, L. (2020). Green dynamic capability of construction enterprises: Role of the business model and green production. Corporate Social Responsibility and Environmental Management, 1–21. https://doi.org/10.1002/csr.2012
Alnaim, M., & Metwally, A. B. M. (2024). Green intellectual capital and corporate environmental performance: Does environmental management accounting matter? Administrative Sciences, 14, 311. https://doi.org/10.3390/admsci14120311
Andersén, J. (2021). A relational natural-resource-based view on product innovation: The influence of green product innovation and green suppliers on differentiation advantage in small manufacturing firms. Technovation, 104, 102254. https://doi.org/10.1016/j.technovation.2021.102254
Anvarjonov, N. B. U., Um, K. H., Zhong, D. Y., & Shine, E. K. (2024). Achieving sustainability in manufacturing: the nexus of green supplier selection, green performance and outcome and process controls. Journal of Manufacturing Technology Management, 35(3), 480–501. https://doi.org/10.1108/JMTM-09-2023-0398
Asiaei, K., O’Connor, N. G., Barani, O., & Joshi, M. (2023). Green intellectual capital and ambidextrous green innovation: The impact on environmental performance. Business Strategy and the Environment, 32(1), 369–386. https://doi.org/10.1002/bse.3136
Asiedu, E., Alhassan, S., Majeed, M., & Malcalm, E. (2025). Green dynamic capability and sustainability performance: The roles of green innovation and green sustainability of manufacturing firms. Discover Sustainability, 6, 961.
Begum, M. A., & Swamy, T. N. V. R. L. (2024). Harnessing green intellectual capital for sustainable development: The dynamic capabilities approach to environmental policy. Business Strategy and Development, 7(4), e70041. https://doi.org/https://doi.org/10.1002/bsd2.70041
Chen, Y. S. (2008). The positive effect of green intellectual capital on competitive advantages of firms. Journal of Business Ethics, 77(3), 271–286. https://doi.org/10.1007/s10551-006-9349-1
Franco, J. D. A. B., Junior, A. F., & Battistelle, R. A. G. (2024). Dynamic capabilities: Unveiling key resources for environmental sustainability and economic sustainability, and corporate social responsibility towards sustainable development goals. Resources, 13, 22.
Hair, J. F., Black, W. C., Babin, B. J., & Anderson, R. E. (2019). Multivariate Data Analysis (Eighth). Cengage Learning EMEA. https://doi.org/10.5117/2006.019.003.007
Hart, S. L. (1995). A natural-resource-based view of the firm. Academy of Management Review, 20(4), 986–1014. https://doi.org/10.2307/258963
Hart, S. L., & Dowell, G. (2011). A natural-resource-based view of the firm: Fifteen years after. Journal of Management, 37(5), 1464–1479. https://doi.org/10.1177/0149206310390219
Harun, M. D., Hogset, H., & Mwesiumo, D. (2023). Dynamic capabilities and sustainability performance: Exploring the moderating role of environmental dynamism in the Norwegian fishing industry. Sustainable Development, 31, 2636–2655. https://doi.org/10.1002/sd.2536
Haug, A., Wickstrøm, K. A., & Stentoft, J. (2025). Conceptualizing green dynamic capabilities as a two-path model: Evidence from Danish manufacturing firms. Journal of Cleaner Production, 511, 145657. https://doi.org/10.1016/j.jclepro.2025.145657
Itan, I., Sylvia, S., Septiany, S., & Chen, R. (2025). The influence of environmental, social, and governance disclosure on market reaction: Evidence from emerging markets. Discover Sustainability, 6(1). https://doi.org/10.1007/s43621-025-01085-0
Krisyadi, R., Masnita, Y., Yusran, H. L., & Jurnali, T. (2025). Towards sustainable excellence: Exploring the synergy of ambidextrous sustainability and sustainability risk management. International Journal of Business and Quality Research, 03(02), 51–70.
Li, C., Hassan, H., Murad, M., & Mirza, F. (2023). Role of Green Dynamic Capabilities on Environmental and Social Innovation Behavior: Mediating of Green Creativity and Moderating of Innovation Proclivity. Sustainability, 15(20), 14996. https://doi.org/10.3390/su152014996
López-Gamero, M. D., Zaragoza-Sáez, P., Claver-Cortés, E., & Molina-Azorín, J. F. (2011). Sustainable development and intangibles: Building sustainable intellectual capital. Business Strategy and the Environment, 20(1), 18–37. https://doi.org/10.1002/bse.666
Martínez-Falcó, J., Sánchez-García, E., Marco-Lajara, B., & Lee, K. (2024). Green intellectual capital and environmental performance: Identifying the pivotal role of green ambidexterity innovation and top management environmental awareness. Journal of Intellectual Capital, 25(2–3), 380–401. https://doi.org/10.1108/JIC-08-2023-0193
Martínez-Falcó, J., Sánchez-García, E., Marco-Lajara, B., & Visser, G. (2025). The influence of green intellectual capital on competitive advantage: A mediation analysis in Spanish wineries. Journal of the Knowledge Economy, 1–30. https://doi.org/10.1007/s13132-025-02811-9
Prieto, M. del C. P., Vallejo, R. C., & Ruiz-Fuensanta, M. J. (2026). Turning green into gold: The impact of green intellectual capital on performance in European firms. Business Strategy and the Environment, 0, 1–14. https://doi.org/10.1002/bse.70629
Qiu, L., Jie, X., Wang, Y., & Zhao, M. (2020). Green product innovation, green dynamic capability, and competitive advantage: Evidence from Chinese manufacturing enterprises. Corporate Social Responsibility and Environmental Management, 27(1), 146–165. https://doi.org/10.1002/csr.1780
Ramadana, M., Masnita, Y., Yusran, H. L., & Jurnali, T. (2025). Green intellectual capital and innovation: Keys to sustainable environmental performance in Manufacturing. International Journal of Scientific Research and Management, 13(04), 8788–8799. https://doi.org/10.18535/ijsrm/v13i04.em12
Singh, S. K., Giudice, M. Del, Jose, C., Jabbour, C., & Latan, H. (2022). Stakeholder pressure, green innovation, and performance in small and medium-sized enterprises: The role of green dynamic capabilities. Business Strategy and the Environment, 31(1), 500–514. https://doi.org/10.1002/bse.2906
Taamneh, A., Taamnh, M., Haija, A. A., & Almutairi, O. (2026). The impact of corporate social responsibility on environmental sustainability in the hospitality sector through green human resource management and organizational climate. Discover Sustainability, 7, 295.
Teece, D. J. (2007). Explicating dynamic capabilities: The nature and microfoundations of (sustainable) enterprise performance. Strategic Management Journal, 28(October), 1319–1350. https://doi.org/10.1002/smj
Teece, D. J., Pisano, G., & Shuen, A. (1997). Dynamic capabilities and strategic management. Strategic Management Journal, 18(7), 509–533. https://doi.org/10.1057/978-1-349-94848-2_689-1
Wang, J., & Zhang, N. (2026). Green innovation and ESG performance: The mediating role of dynamic capabilities in driving sustainable growth. Development and Sustainability in Economics and Finance, 9(368), 100113. https://doi.org/10.1016/j.dsef.2025.100113
Wang, L., Zhang, Z., Cui, S., & Zhu, H. (2025). Green human resource management and corporate environmental performance: The mediating role of corporate reputation and green dynamic capability. Asia Pacific Journal of Human Resources, 63(2), e70000. https://doi.org/https://doi.org/10.1111/1744-7941.70000
Wang, X., Kim, J., Kim, J., & Koh, Y. (2024). Application of natural-resource-based view to nature-based tourism destinations. Sustainability (Switzerland), 16, 2375. https://doi.org/10.3390/su16062375
Xiaoyi, Z., Yang, H., Kumar, N., Bhutto, M. H., Kun, W., & Hu, T. (2023). Assessing Chinese Textile and Apparel Industry Business Sustainability: The Role of Organization Green Culture, Green Dynamic Capabilities, and Green Innovation in Relation to Environmental Orientation and Business Sustainability. Sustainability (Switzerland), 15(11). https://doi.org/10.3390/su15118588
Xing, X., Liu, T., Shen, L., & Wang, J. (2020). Linking environmental regulation and financial performance: The mediating role of green dynamic capability and sustainable innovation. Sustainability, 12, 1007.
Yong, J. Y., Yusliza, M. Y., Ramayah, T., Farooq, K., & Tanveer, M. I. (2023). Accentuating the interconnection between green intellectual capital, green human resource management and sustainability. Benchmarking, 30(8), 2783–2808. https://doi.org/10.1108/BIJ-11-2021-0641
Yu, D., Tao, S., Hanan, A., Ong, T. S., Latif, B., & Ali, M. (2022). Fostering green innovation adoption through green dynamic capability: The moderating role of environmental dynamism and big data analytic capability. International Journal of Environmental Rexearch and Public Health, 19, 10336.
Yusliza, M. Y., Yong, J. Y., Tanveer, M. I., Ramayah, T., Noor Faezah, J., & Muhammad, Z. (2020). A structural model of the impact of green intellectual capital on sustainable performance. Journal of Cleaner Production, 249, 119334. https://doi.org/10.1016/j.jclepro.2019.119334
Zhang, J., Ouyang, Y., Philbin, S. P., Zhao, X., Ballesteros-pérez, P., & Hui, L. (2020). Green dynamic capability of construction enterprises: Role of the business model and green production. Corporate Social Responsibility and Environmental Management, 1–21. https://doi.org/10.1002/csr.2012
Published
2026-04-27
How to Cite
Septiany, S., Masnita, Y., Yusran, H. L., & Jurnali, T. (2026). Beyond Green Intentions: How Green Dynamic Capability and Green Intellectual Capital Drive Environmental Performance. International Journal of Economics, Business and Innovation Research, 5(03), 808-826. https://doi.org/10.63922/ijebir.v5i03.3302
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