How green supply chain integration generates sustainable socio-economic value: Economic and eco-innovation effects in manufacturing firms

Tedjakusuma, Adi Prasetyo and Kulachai, Waiphot and Rudenko, Slavomir (2026) How green supply chain integration generates sustainable socio-economic value: Economic and eco-innovation effects in manufacturing firms. Equilibrium. Quarterly Journal of Economics and Economic Policy, 20 (01). ISSN p-ISSN 1689-765X; e-ISSN 2353-3293

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Abstract

Research background: Manufacturing sectors in emerging economies face intensifying regula- tory, market, and stakeholder pressures to improve environmental stewardship while sustain- ing competitiveness. Green supply chain management practices (GSCMP) are increasingly viewed as mechanisms for enabling firms to reduce ecological burdens and create sustainabil- ity value. Yet, the mechanisms through which integrated GSCMP translate into sustainable outcomes remain insufficiently specified, particularly in emerging-market manufacturing contexts like Indonesia. Purpose of the article: This study examines how integrated GSCMP convert into environmen- tal, economic, and social performance by activating two forms of eco-innovation—green process innovation (PCI) and green product innovation (PDI). Building on the practice-based view and normalization process theory, the study tests both direct and innovation-mediated pathways linking GSCMP to sustainability outcomes. Methods: A survey of 577 Indonesian manufacturing respondents was analyzed using vari- ance-based structural equation modeling. GSCMP were modeled as a second-order formative construct, with PCI and PDI specified as parallel mediators. Direct, indirect, and total effects were assessed through bootstrapping. Findings & value added: The findings show that integrated GSCMP strongly stimulate both PCI and PDI. PCI is positively associated with sustainable outcomes, whereas PDI is linked to environmental and social outcomes but not to economic gains. GSCMP also exerts effects on all three performance dimensions. The study clarifies that PDI yields more immediate mone- tizable benefits, while process-oriented greening generates earlier compliance- and legitimacy- based gains. These contributions advance mechanism-level understanding of how GSCMP create sustainability value in emerging-market manufacturing.

Item Type:	Article
Uncontrolled Keywords:	green supply chain management practice; green innovation; socio-economic performance; environmental performance; sustainability value
Subjects:	H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management
Divisions:	Faculty of Business and Economic > Department of Management
Depositing User:	BAMBANG SEPTIAWAN
Date Deposited:	04 May 2026 02:31
Last Modified:	04 May 2026 02:31
URI:	http://repository.ubaya.ac.id/id/eprint/50684

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