Paving a Way Toward Green World: Two-Track Institutional Approaches and Corporate Green Innovation

Abstract

Whereas previous articles have documented institutional pressure by governments as a key driver of corporate green innovation, relatively less empirical attention has been given to organizational cognitive manipulation by governments. This article theorizes that two-track institutional approaches, especially the combination of institutional pressure (stick) and institutional support (carrot), are instruments for organizational cognitive manipulation. Building on this, we argue that institutional pressure imposes seem-like corporate political tasks, especially corporate green innovation, on firms. In contrast, institutional support helps firms foster manipulation skills of knowledge via access to external knowledge search and achievement of intellectual property rights. This article employs the Korean Innovation Survey (KIS) data from 2014 to 2016 to test the relationship among institutional pressure, institutional support, and corporate green innovation. Our findings indicate that institutional support positively and significantly impacts a firm's engagement in external knowledge search and its achievement of intellectual property rights. External knowledge search positively and significantly influences the achievement of intellectual property rights. Moreover, external knowledge search and intellectual property rights positively mediate the relationship between institutional support and green innovation. This article highlights corporate cognitive manipulation in green innovation practice.