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Green human capital readiness and business performance: do green market orientation and green supply chain management matter?

Bambang Tjahjadi (Department of Accounting, Airlangga University Faculty of Economic and Business, Surabaya, Indonesia)
Ida Bagus Gde Adhista Agastya (Department of Accounting, Airlangga University Faculty of Economic and Business, Surabaya, Indonesia)
Noorlailie Soewarno (Department of Accounting, Airlangga University Faculty of Economic and Business, Surabaya, Indonesia)
Api Adyantari (Department of Accounting, Atma Jaya University Yogyakarta Faculty of Economics, Yogyakarta, Indonesia)

Benchmarking: An International Journal

ISSN: 1463-5771

Article publication date: 30 November 2022

281

Abstract

Purpose

This study aims to examine the effect of green human capital readiness on business performance in the green economy era. This study also focuses on investigating whether the relationship is mediated by green market orientation and green supply chain management.

Design/methodology/approach

This is a quantitative study using the data of 182 manufacturing small and medium-sized enterprises in East Java, Indonesia. Data are collected using an online survey. A multiple mediation research framework is employed, and partial least squares structural equation modeling is used to test the hypotheses.

Findings

The findings demonstrate the following important results. First, green human capital readiness affects business performance. Second, green market orientation partially mediates the effect of green human capital readiness on business performance. Third, green supply chain management partially mediates the effect of green human capital readiness on business performance. Fourth, green market orientation and green supply chain management sequentially mediate the green human capital readiness-business performance relationship.

Research limitations/implications

This study limits its sample to the small and medium-sized enterprises in East Java, Indonesia. Thus, caution must be applied when generalizing to other types of organizations and different regions. The results confirm the resource-based view and sustainability theory in explaining the antecedents of business performance in the era of the green economy which are useful for future researchers and students who are interested in studying human capital, market orientation, supply chain management and business performance.

Practical implications

This study has the following practical implications. First, it implies that the owners/managers of small and medium-sized enterprises need to properly develop their green human capital readiness because they play a strategic role in driving green market orientation, improving green supply chain management and enhancing business performance. Second, it provides useful information to policymakers to make better decision-making in developing environmentally friendly companies.

Originality/value

This study is a response to calls for studies on the antecedents of business performance in the green economy era. It provides empirical evidence for the development of resource-based view and sustainability theory by employing the new construct of green human capital readiness, which has been rarely investigated in previous studies. It also employs a multiple mediation research framework that provides a more comprehensive understanding by including green market orientation and green supply chain management. It also provides empirical evidence in the research setting of small and medium-sized enterprises in Indonesia as an emerging market.

Keywords

Acknowledgements

The authors would like to thank the Ministry of Education, Culture, Research, and Technology Republic of Indonesia for funding this research.

Funding: The study is funded by the Ministry of Education, Culture, Research, and Technology Republic of Indonesia.

Citation

Tjahjadi, B., Agastya, I.B.G.A., Soewarno, N. and Adyantari, A. (2022), "Green human capital readiness and business performance: do green market orientation and green supply chain management matter?", Benchmarking: An International Journal, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/BIJ-10-2021-0622

Publisher

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Emerald Publishing Limited

Copyright © 2022, Emerald Publishing Limited

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