research paper on green technology

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• Published: 22 June 2020

The green economy transition: the challenges of technological change for sustainability

• Patrik Söderholm   ORCID: orcid.org/0000-0003-2264-7043 1  

Sustainable Earth volume  3 , Article number:  6 ( 2020 ) Cite this article

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The Green Economy is an alternative vision for growth and development; one that can generate economic development and improvements in people’s lives in ways consistent with advancing also environmental and social well-being. One significant component of a green economy strategy is to promote the development and adoption of sustainable technologies. The overall objective of this article is to discuss a number of challenges encountered when pursuing sustainable technological change, and that need to be properly understood by policy makers and professionals at different levels in society. We also identify some avenues for future research. The discussions center on five challenges: (a) dealing with diffuse – and ever more global – environmental risks; (b) achieving radical and not just incremental sustainable technological change; (c) green capitalism and the uncertain business-as-usual scenario; (d) the role of the state and designing appropriate policy mixes; and (e) dealing with distributional concerns and impacts. The article argues that sustainable technological change will require a re-assessment of the roles of the private industry and the state, respectively, and that future research should increasingly address the challenges of identifying and implementing novel policy instrument combinations in various institutional contexts.

The green economy transition and sustainable technological change

Over the last decade, a frequent claim has been that the traditional economic models need to be reformed in order to address climate change, biodiversity losses, water scarcity, etc., while at the same time addressing key social and economic challenges. The global financial crisis in 2008–2009 spurred this debate [ 4 ], and these concerns have been translated into the vision of a ‘green economy’ (e.g., [ 31 , 33 , 48 , 54 , 55 ]). Furthermore, in 2015, countries world-wide adopted the so-called 2030 Agenda for Sustainable Development and its 17 Sustainable Development Goals. These goals recognize that ending world poverty must go hand-in-hand with strategies that build economic growth but also address a range of various social needs including education, health, social protection, and job creation, while at the same time tackling environmental pollution and climate change. The sustainable development goals thus also establish a real link between the ecological system and the economic system. They also reinforce the need for a transition to a green economy, i.e., a fundamental transformation towards more sustainable modes of production and consumption.

In this article, we focus on a particularly important component of such a transition, namely the development of sustainable technological change, i.e., production and consumption patterns implying profoundly less negative impacts on the natural environment, including the global climate. Specifically, the article addresses a number of key challenges in supporting – and overcoming barriers to – sustainable technological change. These challenges are presented with the ambition to communicate important lessons from academic research to policy makers and professionals as well as the general public.

Addressing climate and environmental challenges, clearly requires natural scientific knowledge as well as engineering expertise concerning the various technical solutions that can be adopted to mitigate the negative impacts (e.g., carbon-free energy technologies). However, pursuing sustainable technological change is also a societal, organizational, political, and economic endeavor that involves several non-technical challenges. For instance, the so-called transitions literature recognizes that many sectors, such as energy generation, water supply etc., can be conceptualized as socio-technical systems and/or innovation systems [ 24 , 40 ]. These systems consist of networks of actors (individuals, private firms, research institutes, government authorities, etc.), the knowledge that these actors possess as well as the relevant institutions (legal rules, codes of conduct, etc.). In other words, the development of, for instance, new carbon-free technologies may often require the establishment of new value chains hosting actors that have not necessarily interacted in the past; this necessitates a relatively long process that can alter society in several ways, e.g., through legal amendments, changed consumer behavior, distributional effects, infrastructure development and novel business models.

In other words, beyond technological progress, economic and societal adjustment is necessary to achieve sustainable technological change. In fact, history is full of examples that illustrate the need to address the organizational and institutional challenges associated with technological change and innovation. In hindsight, the societal impacts of electricity in terms of productivity gains were tremendous during the twentieth century. Still, while electrical energy was discovered in the late 1870s, in the year 1900, less than 5% of mechanical power in American factories was supplied by electric motors and it took yet another 20 years before their productivity soared [ 14 ]. An important reason for the slow diffusion of electric power was that in order to take full advantage of the new technology, existing factories had to change the entire systems of operation, i.e., the production process, the architecture, the logistics as well as the ways in which workers were recruited, trained and paid. Footnote 1 A similar story emerges when considering the impact of computers on total productivity during the second half of the twentieth century. For long, many companies invested in computers for little or no reward. Also in this case, however, the new technology required systemic changes in order for companies to be able to take advantage of the computer. This meant, for instance, decentralizing, outsourcing, and streamlining supply chains as well as offering more choices to consumers [ 9 ].

This key argument that the adoption of new technology has to be accompanied by systemic changes, applies both to the company as well as the societal level. Any novel solutions being developed must take into account the complexity of the interdependencies between different types of actors with various backgrounds, overall market dynamics, as well as the need for knowledge development and institutional reforms. In fact, the need for systemic changes may be particularly relevant in the case of green technologies, such as zero-carbon processes in the energy-intensive industries (see further below).

Against this background, the issue of how to promote sustainable technological change has received increasing attention in the policy arena and in academic research. The main objective of this article is therefore to discuss some of the most significant societal challenges in pursuing such change, and outline key insights for policy makers as well as important avenues for future research. In doing this, we draw on several strands of the academic literature. The article centers on the following five overall challenges:

Dealing with diffuse – and ever more global – environmental risks

Achieving radical – and not just incremental – sustainable technological change;

The advent of green capitalism: the uncertain business-as-usual scenario

The role of the state: designing appropriate policy mixes, dealing with distributional concerns and impacts.

The first two challenges address the various types of structural tasks that are required to pursue sustainable technological change, and the barriers that have to be overcome when pursuing these tasks. The remaining points concern the role and the responsibility of different key actors in the transition process, not least private firms and government authorities. Each of these five challenges in turn involves more specific challenges, and these are identified and elaborated under each heading. We also provide hints about how to address and manage these challenges, but specific solutions will likely differ depending on the national or regional contexts. The paper concludes by briefly outlining some key avenues for future research, and with an emphasis on research that can assist a green socio-technical transition. Footnote 2

With the advent of modern environmental policy in the 1960s, stringent regulations were imposed on emissions into air and water. However, the focus was more or less exclusively on stationary pollution sources (i.e., industrial plants), which were relatively easy to monitor and regulate, e.g., through plant-specific emission standards. In addition, during this early era there was a strong emphasis on local environmental impacts, e.g., emissions into nearby river basins causing negative effects on other industries and/or on households in the same community.

Over the years, though, the environmental challenges have increasingly been about targeting various types of diffuse emissions. These stem from scattered sources such as road transport, shipping, aviation, and agriculture. Pollution from diffuse sources takes place over large areas and individually they may not be of concern, but in combination with other diffuse sources they can cause serious overall impacts. The growing importance of global environmental challenges such as climate change in combination with globalization and more international trade in consumer products, adds to this challenge. Managing these issues often requires international negotiations and burden-sharing, which in itself have proved difficult [ 12 ]. The difficulties in reaching a stringent-enough global climate agreement illustrate this difficulty.

Diffuse emissions are typically difficult to monitor and therefore also to regulate. For instance, environmental authorities may wish to penalize improper disposal of a waste product since this would help reduce various chemical risks, but such behavior is typically clandestine and difficult to detect. Plastic waste is an apt example; it stems from millions of consumer products, is carried around the world by the currents and winds, and builds up microplastics, particularly in the sea. Many dangerous substances, including chemicals such as solvents and phthalates, are embedded in consumer products, out of which many are imported. Monitoring the potential spread of these substances to humans and the natural environment remains difficult as well. Technological innovation that permits better tracing and tracking of materials should therefore be a priority (see also [ 21 ]).

In order to address these diffuse environmental impacts, society has to find alternative – yet more indirect – ways of monitoring and regulating them. This could translate into attempts to close material cycles and promote a circular economy, i.e., an economy in which the value of products, materials and resources are maintained as long as possible [ 19 ]. In practice, this implies an increased focus on reduction, recycling and re-use of virgin materials [ 30 ], material and energy efficiency, as well as sharing of resources (often with the help of various digital platforms such as Uber and Airbnb). In other words, rather than regulating emissions as close to damage done as possible, the authorities may instead support specific activities (e.g., material recycling) and/or technologies (e.g., low-carbon production processes) that can be assumed to correlate with reduced environmental load.

Addressing diffuse emissions in such indirect ways, though, is not straightforward. In several countries, national waste management strategies adhere to the so-called waste hierarchy (see also the EU Waste Framework Directive). This sets priorities for which types of action should be taken, and postulates that waste prevention should be given the highest priority followed by re-use of waste, material recycling, recovery of waste and landfill (in that order). Even though research has shown that this hierarchy is a reasonable rule of thumb from an environmental point of view [ 42 ], it is only a rule of thumb! Deviations from the hierarchy can be motivated in several cases and must therefore be considered (e.g., [ 58 ]). Footnote 3

One important way of encouraging recycling and reuse of products is to support product designs that factor in the reparability and reusability of products. Improved recyclability can also benefit from a modular product structure (e.g., [ 20 ]). However, this also comes with challenges. Often companies manufacture products in such ways that increase the costs of recycling for downstream processors, but for institutional reasons, there may be no means by which the waste recovery facility can provide the manufacturer with any incentives to change the product design [ 11 , 46 ]. One example is the use of multi-layer plastics for food packaging, which could often be incompatible with mechanical recycling.

While the promotion of material and energy efficiency measures also can be used to address the problem of diffuse environmental impacts, it may be a mixed blessing. Such measures imply that the economy can produce the same amount of goods and services but with less material and energy inputs, but they also lead to a so-called rebound effect [ 27 ]. Along with productivity improvements, resources are freed and can be used to increase the production and consumption of other goods. In other words, the efficiency gains may at least partially be cancelled out by increased consumption elsewhere in the economy. For instance, if consumers choose to buy fuel-efficient cars, they are able to travel more or spend the money saved by lower fuel use on other products, which in turn will exploit resources and lead to emissions.

Finally, an increased focus on circular economy solutions will imply that the different sectors of the economy need to become more interdependent. This interdependency is indeed what makes the sought-after efficiency gains possible in the first place. This in turn requires new forms of collaborative models among companies, including novel business models. In some cases, though, this may be difficult to achieve. One example is the use of excess heat from various process industries; it can be employed for supplying energy to residential heating or greenhouses. Such bilateral energy cooperation is already quite common (e.g., in Sweden), but pushing this even further may be hard and/or too costly. Investments in such cooperation are relation-specific [ 60 ], i.e., their returns will depend on the continuation of the relationships. The involved companies may be too heterogeneous in terms of goals, business practices, planning horizons etc., therefore making long-term commitment difficult. Moreover, the excess heat is in an economic sense a byproduct, implying that its supply will be constrained by the production of the main product. Of course, this is valid for many other types of waste products as well, e.g., manure digested to generate biogas, secondary aluminum from scrapped cars.

In brief, the growing importance of addressing diffuse emissions into the natural environment implies that environmental protection has to build on indirect pollution abatement strategies. Pursuing each of these strategies (e.g., promoting recycling and material efficiency), though, imply challenges; they may face important barriers (e.g., for product design, and byproduct use) and could have negative side-effects (e.g., rebound effects). Moreover, a focus on recycling and resource efficiency must not distract from the need to improve the tracing and tracking of hazardous substances and materials as well as provide stronger incentives for product design. Both technological and organizational innovations are needed.

Achieving radical – and not just incremental – sustainable technological change

Incremental innovations, e.g., increased material and energy efficiency in existing production processes, are key elements for the transition to a green economy. However, more profound – and even radical – technological innovation is also needed. For instance, replacing fossil fuels in the transport sector as well as in iron and steel production requires fundamental technological shifts and not just incremental efficiency improvements (e.g., [ 1 ]). There are, however, a number of factors that will make radical innovation inherently difficult. Below, we highlight three important obstacles.

First , one obstacle is the risk facing firms that invest in technological development (e.g., basic R&D, pilot tests etc.) in combination with the limited ability of the capital market to handle the issue of long-term risk-taking. These markets may fail to provide risk management instruments for immature technology due to a lack of historical data to assess risks. There are also concerns that the deregulation of the global financial markets has implied that private financial investors take a more short-term view [ 44 ]. In fact, research also suggests that due to agency problems within private firms, their decision-making may be biased towards short-term payoffs, thus resulting in myopic behavior also in the presence of fully efficient capital markets [ 53 ].

Second , private investors may often have weak incentives to pursue investments in long-term technological development. The economics literature has noted the risks for the under-provision of public goods such as the knowledge generated from R&D efforts and learning-by-doing (e.g., [ 38 ]). Thus, private companies will be able to appropriate only a fraction of the total rate-of-return on such investment, this since large benefits will also accrue to other companies (e.g., through reverse engineering). Due to the presence of such knowledge spillovers, investments in long-term technological development will become inefficient and too modest.

Third , new green technologies often face unfair competition with incumbent technologies. The incumbents, which may be close substitutes to their greener competitors, will be at a relative competitive advantage since they have been allowed to expand during periods of less stringent environmental policies as well as more or less tailor-made institutions and infrastructures. This creates path-dependencies, i.e. where the economy tends to be locked-in to certain technological pathways [ 2 ]. In general, companies typically employ accumulated technology-specific knowledge when developing new products and processes, and technology choices tend to be particularly self-reinforcing if the investments are characterized by high upfront costs and increasing returns from adoption (such as scale, learning and network economies). Existing institutions, e.g., laws, codes of conduct, etc., could also contribute to path dependence since these often favor the incumbent (e.g., fossil-fuel based) technologies [ 57 ].

The above three factors tend to inhibit all sorts of long-run technological development in the private sector, but there is reason to believe that they could be particularly troublesome in the case of green technologies. First, empirical research suggests that green technologies (e.g., in energy and transport) generate large knowledge spillovers than the dirtier technologies they replace [ 15 , 49 ]. Moreover, while the protection of property rights represents one way to limit such spillovers, the patenting system is subject to limitations. For instance, Neuhoff [ 43 ] remarks that many sustainable technologies:

“consist of a large set of components and require the expertise of several firms to improve the system. A consortium will face difficulties in sharing the costs of ‘learning investment’, as it is difficult to negotiate and fix the allocation of future profits,” (p. 98).

These are generally not favorable conditions for effective patenting. Process innovations, e.g., in industry, are particularly important for sustainable technology development, but firms are often more likely to employ patents to protect new products rather than new processes [ 39 ]. Footnote 4

Furthermore, one of the key socio-technical systems in the green economy transition, the energy system, is still today dominated by incumbent technologies such as nuclear energy and fossil-fueled power, and exhibits several characteristics that will lead to path dependent behavior. Investments are often large-scale and exhibit increasing returns. Path dependencies are also aggravated by the fact that the outputs from different energy sources – and regardless of environmental performance – are more or less perfect substitutes. In other words, the emerging and carbon-free technologies can only compete on price with the incumbents, and they therefore offer little scope for product differentiation. In addition, the energy sectors are typically highly regulated, thus implying that existing technological patterns are embedded in and enforced by a complex set of institutions as well as infrastructure.

In brief, technological change for sustainability requires more radical technological shifts, and such shifts are characterized by long and risky development periods during which new systemic structures – i.e., actor networks, value chains, knowledge, and institutions – need to be put in place and aligned with the emerging technologies. Overall, the private sector cannot alone be expected to generate these structures, and for this reason, some kind of policy support is needed. Nevertheless, in order for any policy instrument or policy mix to be efficient, it has to build on a proper understanding of the underlying obstacles for long-run technological development. As different technologies tend to face context-specific learning processes, patenting prospects, risk profiles etc., technology-specific support may be needed (see also below).

At least since the advent of the modern environmental debate during the 1960s, economic and environmental goals have been perceived to be in conflict with each other. Business decisions, it has been argued, build on pursuing profit-maximization; attempts to address environmental concerns simultaneously will therefore imply lower profits and reduced productivity. However, along with increased concerns about the environmental footprints of the global economy and the growth of organic products and labels, material waste recycling, climate compensation schemes etc., sustainability issues have begun to move into the mainstream business activities. In fact, many large companies often no longer distinguish between environmental innovation and innovation in general; the environmental footprints of the business operations are almost always taken into consideration during the innovation process (e.g., [ 47 ]).

Some even puts this in Schumpeterian terms, and argues that sustainable technological change implies a “new wave of creative destruction with the potential to change fundamentally the competitive dynamics in many markets and industries,” ([ 37 ], p. 315). The literature has recognized the potentially important roles that so-called sustainability entrepreneurs can play in bringing about a shift to a green economy; these types of entrepreneurs seek to combine traditional business practices with sustainable development initiatives (e.g., [ 25 ]). They could disrupt established business models, cultures and consumer preferences, as well as help reshape existing institutions. Just as conventional entrepreneurs, they are agents of change and offer lessons for policy makers. However, the research in this field has also been criticized for providing a too strong focus on individual success stories, while, for instance, the institutional and political factors that are deemed to also shape the priorities made by these individuals tend to be neglected (e.g., [ 13 ]).

Ultimately, it remains very difficult to anticipate how far voluntary, market-driven initiatives will take us along the long and winding road to the green economy. In addition to a range of incremental developments, such as increased energy and material efficiency following the adoption of increased digitalization, industrial firms and sustainability entrepreneurs are likely to help develop new and/or refined business models (e.g., to allow for increased sharing and recycling of resources) as well as adopt innovations commercially. In the future, businesses are also likely to devote greater attention to avoiding future environmental liabilities, such as the potential costs of contaminated land clean-up or flood risks following climate change. Far from surprising, large insurance companies were among the first to view climate change as a risk to their viability. One response was the development of new financial instruments such as ‘weather derivatives’ and ‘catastrophe bonds’ [ 35 ].

In other words, there is an increasing demand for businesses that work across two logics that in the past have been perceived as incompatible: the commercial and the environmental. There are however huge uncertainties about the scope and the depth of green capitalism in this respect. Moreover, the answer to the question of how far the market-driven sustainability transition will take us, will probably vary depending on business sector and on factors such as the availability of funding in these sectors. Footnote 5

As indicated above, there are reasons to assume that in the absence of direct policy support, businesses will not be well-equipped to invest in long-term green technology development. Green product innovations may often be easier to develop and nurture since firms then may charge price premiums to consumers. In fact, many high-profile sustainability entrepreneurs in the world (e.g., Anita Roddick of The Body Shop) have been product innovators. In contrast, green process innovation is more difficult to pursue. It is hard to get consumers to pay premiums for such innovations. For instance, major efforts are needed to develop a carbon-free blast furnace process in modern iron and steel plants (e.g., [ 1 ]). And even if this is achieved, it remains unclear whether the consumers will be willing to pay a price premium on their car purchases purely based on the knowledge that the underlying production process is less carbon-intense than it used to be. Moreover, taking results from basic R&D, which appear promising on the laboratory scale, through “the valley of death” into commercial application is a long and risky journey. Process innovations typically require gradual up-scaling and optimization of the production technologies (e.g., [ 29 ]). For small- and medium-sized firms in particular, this may be a major hurdle.

In brief, the above suggests that it is difficult to anticipate what a baseline scenario of the global economy – i.e., a scenario involving no new policies – would look like from a sustainability perspective. Still, overall it is likely that green capitalism and sustainability entrepreneurship alone may have problems delivering the green economy transition in (at least) two respects. First, due to the presence of knowledge spillovers and the need for long-term risk-taking, the baseline scenario may involve too few radical technology shifts (e.g., in process industries). Second, the baseline scenario is very likely to involve plenty of digitalization and automation, in turn considerably increasing the potential for material and energy efficiency increases. Nevertheless, due to rebound effects, the efficiency gains resulting from new technologies alone may likely not be enough to address the sustainability challenge. This therefore also opens up the field for additional policy support, and – potentially – a rethinking of the role of the state in promoting sustainable technological change.

An important task for government policy is to set the appropriate “framework conditions” for the economy. This refers primarily to the legal framework, e.g., immaterial rights, licensing procedures, as well as contract law, which need to be predictable and transparent. Traditional environmental policy that regulates emissions either through taxes or performance standards will remain important, as will the removal of environmentally harmful subsidies (where such exist). The role of such policies is to make sure that the external costs of environmental pollution are internalized in firms’ and households’ decision-making (e.g., [ 7 ]). Still, in the light of the challenges discussed above – i.e., controlling diffuse emissions, the need for more fundamental sustainable technological change, as well as the private sector’s inability to adequately tackle these two challenges – the role of the state must often go beyond providing such framework conditions. In fact, there are several arguments for implementing a broader mix of policy instruments in the green economy.

In the waste management field, policy mixes may be needed for several reasons. For instance, previous research shows that in cases where diffuse emissions cannot be directly controlled and monitored, a combined output tax and recycling subsidy (equivalent to a deposit-refund system) can be an efficient second-best policy instrument mix (e.g., [ 59 ]). This would reduce the amount of materials entering the waste stream, while the subsidy encourages substitution of recycled materials for virgin materials. Footnote 6 An extended waste management policy mix could also be motivated by the limited incentives for manufacturers of products to consider product design and recyclability, which would decrease the costs of downstream recycling by other firms. This is, though, an issue that often cannot be addressed by traditional policies such as taxes and standards; it should benefit from technological and organizational innovation. Finally, the establishment of efficient markets for recycled materials can also be hampered by different types of information-related obstacles, including byers’ inability to assess the quality of mixed waste streams. In such a case, information-based policies based on, for instance, screening requirements at the waste sites could be implemented (e.g., [ 46 ]).

At a general level, fostering green technological development, not least radical innovation, must also build on a mix of policies. The literature has proposed an innovation policy mix based on three broad categories of instruments (see also [ 36 , 51 , 52 ]):

Technology-push instruments that support the provision of basic and applied knowledge inputs, e.g., through R&D grants, patent protection, tax breaks etc.

Demand-pull instruments that encourage the formation of new markets, e.g., through deployment policies such as public procurement, feed-in tariffs, quotas, etc.

Systemic instruments that support various functions operating at the innovation system level, such as providing infrastructure, facilitating alignment among stakeholders, and stimulating the development of goals and various organizational solutions.

A key role for a green innovation policy is to support the development of generic technologies that entrepreneurial firms can build upon [ 50 ]. Public R&D support and co-funding of pilot and demonstration plants help create variation and permit new inventions to be verified, optimized and up-scaled. As noted above, there is empirical support for public R&D funding of green technology development, as underinvestment due to knowledge spillovers might be particularly high for these technologies.

As the technology matures, though, it must be tested in a (niche) market with real customers, and the state will often have to create the conditions for private firms to raise long-term funding in areas where established financial organizations are not yet willing to provide sufficient funds. For instance, in the renewable energy field, this has been achieved by introducing feed-in tariffs or quota schemes for, for instance, wind power and solar PV technology (e.g., [ 16 ]). Finally, well-designed systemic instruments will have positive impacts on the functioning of the other instruments in the policy mix; while technology-push and demand-pull instruments are the engines of the innovation policy mix, the systemic instruments will help that engine run faster and more efficiently.

The implementation of the above policy mixes will be associated with several challenges, such as gaining political acceptability, identifying the specific designs of the policy instruments, and determining how these instruments can be evaluated. All these issues deserve attention in future research. Still, here we highlight in particular the need for policies that are technology-specific; i.e., in contrast to, for instance, pollution taxes or generic R&D subsidies they promote selected technological fields and/or sectors. Based on the above discussions one can point out two motives for relying on technology-specific instruments in promoting sustainable technological change: (a) the regulations of diffuse emissions can often not target diffuse emissions directly – at least not without incurring excessively high monitoring costs; and (b) the need to promote more radical environmental innovations.

The innovation systems surrounding green energy technology tend to be technology-specific. Different technologies are exposed to unique and multi-dimensional growth processes, e.g., in terms of bottlenecks, learning processes, and the dynamics of the capital goods industries [ 34 ]. The nature of the knowledge spillovers and the long-term risks will also differ as will the likelihood that green technologies suffer from technological lock-in associated with incumbent technology (e.g., [ 38 ]). For instance, the technological development process for wind power has been driven by turbine manufacturers and strong home markets, while equipment suppliers and manufacturers that own their own equipment have dominated solar PV development [ 32 ].

Clearly, technology-specific policies are difficult to design and implement; regulators typically face significant information constraints and their decisions may also be influenced by politico-economic considerations such as bureaucratic motives, and lobby group interests. Moreover, the prospects for efficient green technology-specific policies may likely also differ across jurisdictions; some countries will be more likely to be able to implement policies that can live up to key governing principles such as accountability, discipline and building on arms-length interactions with the private sector. As noted by Rodrik [ 50 ], “government agencies need to be embedded in, but not in bed with, business,” (p. 485).

The above begs the question whether the governance processes at the national and the supra-national levels (e.g., the EU) are in place to live up to a more proactive and transformative role for the state. Newell and Paterson [ 45 ] argue that such a state needs to balance two principles that have for long been seen as opposed to one another. These are, one the one hand, the empowerment of the state to actively determine priorities and, on the other, “providing citizens with more extensive opportunities to have a voice, to get more involved in decision-making processes, and to take on a more active role in politics,” (p. 209). The latter issue is further addressed also in the next section.

In brief, the climate and environmental challenges facing society today require a mix of policy instruments, not least because the barriers facing new sustainable technology are multi-faceted and often heterogeneous across technologies. Supporting green innovation should build on the use of technology-specific policies as complements to traditional environmental policies. This in itself poses a challenge to policy-making, and requires in-depth understanding of how various policy instruments interact as well as increased knowledge about the institutional contexts in which these instruments are implemented.

The transition to a green economy, including technological change, affects the whole of society. It is therefore necessary to not only optimize the performance of the new technologies and identify efficient policies; the most significant distributional impacts of technological change must also be understood and addressed. All societal changes involve winners and losers, and unless this is recognized and dealt with, the sought-after green transition may lack in legitimacy across various key groups in society. Bek et al. [ 6 ] provide an example of a green economy initiative in South Africa – the so-called Working for Water (WfW) program – that has failed to fully recognize the social aspects of the program goals.

This challenge concerns different dimensions of distributional impacts. One such dimension is how households with different income levels are affected. Economics research has shown that environmental policies in developed countries, not least taxes on pollution and energy use, tend to have regressive effects [ 22 ], thus implying that the lowest-income households are generally most negatively affected in relative terms. Such outcomes may in fact prevail also in the presence of policies that build on direct support to certain technological pathways. For instance, high-income households are likely to benefit the most from subsidies to solar cells and electric cars, this since these households are more likely to own their own house as well as to be more frequent car buyers. Of course, technological change (e.g., digitalization, automation etc.), including that taking place in green technology, may also have profound distributional impacts in more indirect ways, not the least through its impacts on the labor market (e.g., wages. Work conditions) (e.g., [ 3 ]).

The regional dimension of sustainable development is also important (e.g., [ 26 ]). One challenge in this case is that people increasingly expect that any green investments taking place in their own community (e.g., in wind power) should promote regional growth, employment and various social goals. The increased emphasis on the distributional effects at the regional level can also be attributed to the growing assertion of the rights of people (e.g., indigenous rights), and increased demands for direct participation in the relevant decision-making processes. However, new green technology may fail to generate substantial positive income and employment impacts at the local and regional level. For instance, one factor altering the renewable energy sector’s relationship with the economy has been technological change. A combination of scale economies and increased capital intensity has profoundly increased the investment capital requirements of facilities such as wind mill parks and biofuel production facilities. The inputs into modern green energy projects increasingly also have to satisfy high standards in terms of know-how, and these can therefore not always be supplied by local firms (e.g., [ 18 ]). Indeed, with the implementation of digital technology, the monitoring of, say, entire wind farms can today be done by skilled labor residing in other parts of the country (or even abroad).

Ignoring the distributional effects of sustainable technological change creates social tensions, thereby increasing the business risks for companies and sustainability entrepreneurs. Such risks may come in many forms. For instance, reliability in supply has become increasingly important, and customers will generally not be very forgiving in the presence of disruptions following the emergence of tense community relations. Furthermore, customers, fund managers, banks and prospective employees do not only care about the industry’s output, but increasingly also about how the products have been produced.

In fact, while the economies of the world are becoming more integrated, political trends are pointing towards a stronger focus on the nation state and even on regional independence. If anything, this will further complicate the green economy transition. Specifically, it will need to recognize the difficult trade-offs between efficiency, which typically do require international coordination (e.g., in terms of policy design, and R&D cooperation), and a fair distribution of benefits and costs, which instead tends to demand a stronger regional and local perspective.

In brief, the various distributional effects of sustainable technological change deserve increased attention in both scholarly research and the policy domain in order to ensure that this change emerges in ways that can help reduce poverty and ensure equity. These effects may call for an even broader palette of policies (e.g., benefit-sharing instruments, such as regional or local natural resource funds, compensation schemes, or earmarked tax revenues), but they also call for difficult compromises between efficiency and fairness.

Conclusions and avenues for future research

The scope and the nature the societal challenges that arise as a consequence of the climate and environmental hazards are complex and multi-faceted, and in this article we have focused on five important challenges to sustainable technological change. These challenges are generic, and should be a concern for most countries and regions, even though the specific solutions may differ depending on context. In this final section, we conclude by briefly discussing a number of implications and avenues for future research endeavors. Footnote 7 These knowledge gaps may provide important insights for both the research community as well as for policy makers and officials.

It should be clear that understanding the nature of – as well as managing – socio-technical transitions represents a multi-disciplinary research undertaking. Collaborations between natural scientists and engineers on the one hand and social scientists on the other are of course needed to translate environmental and technical challenges into societal challenges and action. In such collaborative efforts, however, it needs to be recognized that technological change is not a linear process; it entails phases such as concept development, pilot and demonstration projects, market formation and diffusion of technology, but also with important iterations (i.e., feedback loops) among all of these phases. It should be considered how bridges between different technical and social science disciplines can be built, this in order to gain a more in-depth understanding of how technology-specific engineering inventions can be commercialized in various institutional contexts. Transition studies, innovation and environmental economics, as well the innovation system and the innovation management literatures, among others, could help provide such bridges. Other types of systems studies, e.g., energy system optimization modeling, will also be important.

In addition to the above, there should also be an expanded role for cross-fertilization among different social sciences, e.g., between the economics, management and political science fields and between the research on sustainability entrepreneurs and transition studies (see also [ 26 ]). This could help improve the micro-foundations of, for instance, innovation system studies, i.e., better understanding of companies’ incentives, drivers etc., but also stress the need for considering socio-technical systems in the management research. For instance, the focus on individual heroes that pervades much of the entrepreneurship literature may lead to a neglect of the multiple factors at work and the role of framework conditions such as institutions (e.g., legal rules, norms) and infrastructure at the national and local scales. Better integration of various conceptual perspectives on green business and innovation could generate less uncertain business-as-usual scenarios.

The discussions in this article also suggest that green innovation in the public sector should be devoted more attention in future research. This could, of course, focus on various institutional and organizational innovations in the form of new and/or revised policy instrument design. The challenges involved in designing and implementing technology-specific sustainability policies, typically referred to as green industrial policies [ 50 ], tend to require such innovation (e.g., to increase transparency, and avoid regulatory capture). These policies are essentially processes of discovery, both by the state and the industry, rather than a list of specific policy instruments. This implies learning continuously about where the constraints and opportunities lie, and then responding to these.

The risk associated with regulatory capture is one issue that deserves increased attention in future research, including how to overcome such risks. Comparisons of green industrial policies across countries and technological fields – as well as historical comparative studies – could prove useful (e.g., [ 8 ]). How different policies interact as well as what the appropriate level of decision-making power is, are also important questions to be addressed. Of course, given the context-specificity of these types of policies, such research must also address the issue of how transferable innovation and sustainable practices are from one socio-technical and political context to another.

Moreover, the growing importance of diffuse emissions also requires green innovation in the public sector. Specifically, implementing environmental regulations that are close to damages demand specific monitoring technologies that can measure pollution levels. The development of new technologies – which, for instance, facilitates cheap monitoring of emissions – ought to be promoted, but it is quite unclear who has the incentive to promote and undertake such R&D activities. Similar concerns can be raised about the innovations that permit consumers to better assess the environmental footprints of different products and services (e.g., [ 21 ]). Private firms cannot be expected to pursue these types of green innovations intensively. Nevertheless, governments often spend substantial amounts on funding R&D on pollution abatement technology, but less frequently we view government programs funding research on technologies that can facilitate policy enforcement and environmental monitoring.

Finally, the green economy transition should also benefit from research that involves various impact evaluations, including methodological innovation in evaluation studies. This concerns evaluations of the impacts of important baseline trends, e.g., digitalization and automation, globalization versus nationalization, etc., on environmental and distributional outcomes but also on the prospects for green innovation collaborations and various circular economy-inspired business models. Such evaluations could be particularly relevant for understanding possible future pathways for the greening – and de-carbonization – of key process industries. Clearly, there is also need for improved evaluations of policy instruments and combinations of policies. With an increased emphasis on the role of technology-specific policies, such evaluations are far from straightforward. They must consider the different policies’ roles in the innovation systems, and address important interaction effects; any evaluation must also acknowledge the policy learning taking place over time.

Availability of data and materials

Not applicable.

For instance, in the new system, workers had more autonomy and flexibility (e.g., [ 28 ]).

Clearly, given the focus on sustainable technological change, this article does not address all dimensions of the transition to a green economy. Heshmati [ 31 ] provides a recent review of the green economy concept, its theoretical foundations, political background and developmental strategies towards sustainable development. See also Megwai et al. [ 41 ] for an account of various green economy initiatives with a specific focus on developing countries, and Bartelmus [ 5 ] for a critical discussion of the link between the green economy and sustainable development.

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The UNFCCC [ 56 ] reports substantial increases in climate-related global finance flows, but these flows are still relatively small in the context of wider trends in global investment. They are even judged to be insufficient to meet the additional financing needs required for adaptation to the climate change that cannot be avoided.

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Acknowledgements

Financial support from Nordforsk (the NOWAGG project) is gratefully acknowledged, as are valuable comments on earlier versions of the manuscript from Åsa Ericson, Johan Frishammar, Jamil Khan, Annica Kronsell, one anonymous reviewer and the Editor. Any remaining errors, however, reside solely with the author.

Financial support from Nordforsk and the NOWAGG project on Nordic green growth strategies is gratefully acknowledged. Open access funding provided by Lulea University of Technology.

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ORIGINAL RESEARCH article

Green innovation practices and its impacts on environmental and organizational performance.

• 1 School of Management, Jiangsu University, Zhenjiang, China
• 2 Lahore Business School, University of Lahore, Lahore, Pakistan

This study aims to investigate the impact of stakeholders’ views on the practices of green innovation (GI), consequent effect on environmental and organizational performance (OP), and moderating influence of innovation orientation. A quantitative method was employed for the sample size of 515 responses. To accumulate the data from the respondents, convenient random sampling was used. Data were collected from manufacturing and services firms through a field survey by using a closed-ended questionnaire based in the Punjab province of Pakistan. The analysis was done using the structural equation model of the partial least square analysis method. Our findings proved a positive and significant link between stakeholders’ views on GI practices. A significant association has been found between GI practices and environmental and OP. The moderating effect was found to be negative but statistically significant. This research offers numerous contributions and provides decision-making insinuations.

Introduction

Resource limitations and environmental concerns have made sustainable operations of assets and environmental pollution one of the major global issues. The economy’s overall development may not go “hand in hand” with the reduction of pollution and sustainable management of resources ( Wang and Song, 2014 ). Building a sense of balance among high resource consumption and development of economy relics is a constant challenge that forces organizations to run-through eco-friendly professional deeds having high economic worth ( Chan et al., 2012 ). Many organizations are forced to adopt activities that generate and increase economic value ( Porter and Kramer, 2019 ).

The excessive use of non-renewable resources prompted by speedy economic development has hurt the atmosphere and elevated various environmental worries ( Atlin and Gibson, 2017 ). To preserve energy and lessen emissions of carbon, numerous countries have established agencies and regulations for environmental sustainability and its protections; examples comprise limitations on “chlorofluorocarbons, the sustainable development announcements of the Johannesburg world summit,” and limits on the usage of few hazardous materials “electrical and electronic equipment requirements, the European Union’s Restriction of Hazardous Substances Directive” ( Weng et al., 2015 , p. 4998). Such impositions of rule and regulations have drawn the attention of environmental supervisors ( Zhu and Sarkis, 2004 ; Claver et al., 2007 ); they also have the same outcome in varying the management and competition practices between the organizations ( Feng and Chen, 2018 ). To adhere to the new eco-friendly regulations, to have a positive branding image ( Chen, 2008a ; Hillestad et al., 2010 ), to improve their firms’ performance and to have a competitive advantage ( Claver et al., 2007 ; Rusinko, 2007 ), organizations have had to accept eco-friendly practices ( Afridi et al., 2020 ).

Numerous investigations examined factors altering green innovations (GI) practices, such as environmental regulations, ethics, legal systems, and supply chain ( Feng and Chen, 2018 ; Gao et al., 2018 ; El-Kassar and Singh, 2019 ; Seman et al., 2019 ). Studies have also examined an increase in awareness, the general public, and stakeholder pressure linked to green environmental issues ( Foo, 2018 ). Moreover, literature provides evidence of optimized pressure from society, customers, and government bodies to practice GI. However, the literature lacks findings on the relationship of stakeholders’ pressure [competitor’s pressure, government pressure, and employee conduct (EC)] about GI practices. The manufacturing sector faces higher stakeholder pressure due to possibly the highest waste-producing sector ( Chen, 2008b ; Chang, 2011 ). The single industry was studied for GI practices ( Cordano et al., 2010 ; Lin and Ho, 2011 ). This study fills the gap in investigating these constructs in the manufacturing and service industries to enrich existing GI practices and stakeholder pressure literature. Moreover, stakeholder pressure (customer) was examined for GI in third party logistic firms ( Chu et al., 2019 ), as well as in express companies ( Zhang et al., 2020 ), and in manufacturing firms ( Song et al., 2020 ). Those three studies were conducted in China’s context, which highlights the issue of conducting and focusing on the stakeholder pressure in the manufacturing and service industries of Pakistan being a developing economy in the initial stages of GI practices adoption ( Shahzad M. et al., 2020 ).

“Go-green” is an initiative mainly employed by firms to deal with eco-friendly problems. Approaches to attain green abilities and emerging eco-friendly practices have focused on attention and discussion in the management sciences’ discipline over the years ( Ullah, 2017 ). To ease the acceptance of GI, firms must consider the significant factors and precursors in their business entities ( Arfi et al., 2018 ). These comprise apprehensions of consumers ( Zhu et al., 2017 ), preferences of professionals and owners ( Huang et al., 2009 ), competency of suppliers and partners ( Chiou et al., 2011 ), government regulating authorities and their regulations ( Kammerer, 2009 ), and the environmental, technological, and organizational factors of GI practices ( Lin and Ho, 2011 ). Green technologies consist of GI practices (e.g., green product, process, managerial, and marketing innovation) and the execution of green human resource management practices (e.g., green training and development, administrative support and culture, recruitment and selection, compensation, and benefits). GI is a significant strategic enabler to acquire justifiable development, as it practices energy-saving, environment-protecting, waste-recycling, and pollution-preventing methods ( Albort-Morant et al., 2018 ). Furthermore, GI can be divided into green product, green marketing, green processes, and green management that are intended for eco-friendly environment, decreasing consumption of energy and increasing efficient use of the resource, control over pollution emission, and waste recycling, improving the performance of the organization and providing the pollution-free environment to society at large scale ( Seman et al., 2019 ).

Previous studies have witnessed some proofs of the impacts of numerous drivers such as corporate environmental ethics ( El-Kassar and Singh, 2019 ), environmental regulations ( Feng and Chen, 2018 ), the legal system ( Gao et al., 2018 ), and green supply chain management practices ( Seman et al., 2019 ) on GI practices. To date, some systematic and comprehensive investigations of the precursors and factors of GI have been performed. Foo (2018) proposed that the increase in awareness and pressure from the stakeholders and the general public have necessitated organizations to be more transparent in facing and handling green environmental issues of their supply base execution. Hence, it is critical to focus on stakeholders’ views in an organization on establishing and sustaining GI abilities and practices. Then executives of organizations are involved in examining the essential factors necessary for creating GI practices. Are there pressures from established institutions’ regulations and competitor’s critical factors of GI? How should firms have dealt with the concerns of both internal and external stakeholders?

Furthermore, previous studies have concentrated on the manufacturing sector as it is one of the most critical waste producers that upset the balance of an environment. With rising trepidations on global pollution, this industry is facing increasing pressures from customers, society, and governing agencies to save energy, resources, protect the eco-friendly environment and maintain its sustainability ( Chen, 2008b ; Chang, 2011 ) or on a single industry (e.g., Cordano et al., 2010 ; Lin and Ho, 2011 ). It would be beneficial to offer an all-purpose model to investigate issues about GI for both the service and manufacturing firms. Therefore, in this study, we borrowed help from the “stakeholder theory” ( Freeman, 2010 ) to aid in our investigation methodology. This theory has been utilized to get a comprehensive view of a particular organization to examine stakeholders’ influence (participants) on GI practices. To answer the stakeholders’ pressure, organizations should focus on an overall strategic plan that involves and satisfies both internal and external stakeholder groups ( Bryson, 2018 ).

Review of Literature

Stakeholder view (sv).

The word “stakeholders” was initially used by the “Stanford Research Institute” in 1963 and was defined as “those groups without whose support the organization would cease to exist” ( Friedman and Miles, 2006 ). While this concept was first brought into a “strategic discipline” in 1984 by Freeman (1984) , stakeholders were not only separate from shareholders but also involved in the decision-making process ( Donaldson and Preston, 1995 ; Mitchell et al., 1997 ). In an academic view, the “stakeholder theory” holds a unique perspective for the organizations and offers a diverse description of a firm’s structure and everyday actions ( Sulkowski et al., 2018 ). The stakeholder theory, founded on four indispensable grounds ( Jones and Wicks, 1999 ), first suggests that organizations have associations with several procedures, all of which are upset or pretentious by their results ( Laplume et al., 2008 ; Co and Barro, 2009 ). Second, such links are recognized in the firms’ procedures and results and their stakeholders’ firms’ views.

Third, stakeholders’ inherent value, and comforts cannot be permitted to override the safeties of others ( Clarkson, 1995 ; Co and Barro, 2009 ). Fourth, the decision making of the organizations is the central point ( Alrowwad et al., 2017 ). Stakeholder theory has been accepted for numerous ecological scholarships in that it has been active in persuading both company environmental sensitivity ( Crane and Livesey, 2017 ) and environmental policies ( Salem et al., 2018 ). Although the outcomes have been mixed, and the stakeholders’ views on ecological management have been unpredictable. For example, Jaaffar and Amran (2017) found that the organizations’ board of directors is involved in deciding eco-friendly strategies and policies while small business entities and proprietors decide GI ( Huang et al., 2009 ). In addition, in manufacturing organizations in Germany, stakeholders have affected the firms’ selections concerning ecological response forms ( Murillo-Luna et al., 2008 ), and they were confidently related with unproved GI ( Wagner, 2007 ); in contrast, the association among eco-friendly policies and stakeholders’ administration was not perfect in Belgian organizations ( Buysse and Verbeke, 2003 ). The review paper by Seman et al. (2018) concludes that the stakeholders’ views have a more considerable influence on GI practices.

Green Innovation (GI)

Works of GI are commonly divided into two types. The first describes GI as a firm’s abilities ( Gluch et al., 2009 ), whereas the second defines GI as an organization’s environmental practices ( Lin and Ho, 2008 ; Ho et al., 2009 ). When it comes to organizational practices, GI is described as “the hardware or software innovation related to green products or processes” ( Song and Yu, 2018 ); it is proposed that GI comprises management practices and technological advancements that expand the environmental and organizational performance (OP) and provide a competitive edge to the firms ( Rennings, 2000 ). Other researchers recommend that GI consists of unique or altered systems, processes, products, and practices that provide an advantage to the environment and subsidize firms’ sustainability ( Xie et al., 2019 ).

A recent study expresses GI as “the new or modified products and processes, including technology, managerial, and organizational innovations, which helps to sustain the surrounding environment” ( Ilvitskaya and Prihodko, 2018 ). Moreover, GI may refer to “a creative initiative that reduces negative environmental impacts or that yields environmental benefits as it creates value in the market” ( Chen et al., 2006 ). GI is divided into two kinds, such as “green product innovations” (providing new green products to consumers) and “green process inventions” or “greening” business procedures ( Tang et al., 2018 ). Furthermore, due to the growing customer-centered apprehensions concerning environmental protection, ecological management has become a critical part of many firms’ strategic policies and tactical plans ( Chiou et al., 2011 ; Khan et al., 2019 ).

Regulations related to an environment may lead toward a “win-win situation” ( Chan et al., 2018 ) since they can perform dual tasks, increase profits and lessen pollution; It is proposed that GI should be categorized distinctively from other innovative maneuvers since it harvests not only a spillover consequence for exploration and expansion efforts but also optimistic external possessions such as enlargements in the atmosphere ( Kammerer, 2009 ). A study by Feng et al. (2018) on the Chinese industry’s manufacturing firms has shown that internal and external environmental orientation is significantly associated with GI practices. The utilization of GI practices inside and outside the firms’ restrictions are vital for impacting both economic and ecological performance goals ( Khan and Qianli, 2017 ; Saeed et al., 2018 ). Moreover, Lee et al. (2018) found that stakeholders’ pressure, organizational support, and societal expectations were significant factors for the motivation to adopt GI practices and corporate environmental responsibility ( Shahzad F. et al., 2020 ). Moreover, the study of Fernando et al. (2019) showed that GI, regulation, supplier intervention, and technology have a strong influence on sustainable performance mediated by service innovation capabilities. The study by Famiyeh et al. (2018) also supported eco-friendly practices, showing that environmental management practices have direct and indirect positive effects on environmental performance. Xie et al. (2019) used green product innovation as a moderator for the green process innovation and OP, but the study did not find the supported results.

Proposed Framework and Hypothesis Development

Proposed framework.

This study involves the three dimensions of stakeholders’ view (e.g., competitor pressure, government pressure, and employees conduct) as independent variables. Organizational and environmental performance are used as dependent variables. Moreover, GI practices (e.g., green product and green process) are used as mediators, and the moderating role is performed by innovation orientation (IO). A total of six hypotheses have been suggested and showed in Figure 1 .

Figure 1. Conceptual model of the study.

Hypothesis Development

We followed “Freeman’s stakeholder framework” ( Freeman, 2010 ). We used three stakeholders’ dimensions to view the government’s and competitors’ pressure as external and employees’ conduct as internal stakeholders. However, there are various other dimensions, such as customer, community, and supplier pressure. This study also treats both aspects of stakeholder’s views as factors that are employing pressure on the organizations and motivating the firms to improve environmental practices. Identifying eco-friendly business practices are becoming critical elements as organizations are confronted with “both internal and external forces/pressures from environmental agencies, governmental regulations, stakeholders, competitors, customers and employees” ( Wang and Song, 2014 ). Singh and El-Kassar (2018) conclude that the stakeholders’ view (e.g., pressure by the government, competitors, employees, customers, society, and suppliers, respectively) positively influences the GI practices.

Competitors Pressure (CP)

Organizations generally act in response to the movements of rivals and the operating industry. When competitors accept or implement new eco-friendly practices, organizations in the same sector will feel overstretched to reconfigure the structures and policies ( Durand and Georgallis, 2018 ). In short, organizations need to be attentive to their competitor’s products/services, actions, and norms and regulations of the industry they are part of so that their innovation abilities are similar to others in the industry. For instance, organizations must be conscious of new energy-saving, waste-recycling, pollution-preventing methods, and changes in processes used for the implementation and paraphernalia that are accessible in the market. They are required to have an eye on the methods their competitors have adopted to lessen energy costs while restructuring process and reconfiguring their manufacturing facilities to overtake/perform equivalent to/better than their rivals. Thus, to endure competitive spots, organizations may emulate competitors’ environmental practices and actions, especially the front-runners in their industries ( Abrahamson and Rosenkopf, 1993 ). Singh and El-Kassar (2018) found a positive relationship between stakeholders’ views and GI practices. Furthermore, a study on 442 Chinese firms also confirmed that competitors’ pressure provides organizations with more significant incentives to adopt GI practices ( Cai and Li, 2018 ). In another study ( Yu, 2019 ), the results revealed that formal and informal environmental regulation and pressures have strong influences on food-making companies’ GI activities. Thus, hypothesis 1 is established:

H 1 : Competitor’s pressure has a significant impact on GI practices.

Governmental Pressures (GP)

Various scholarships have explored the association among regulatory rules and environmental practices and have proposed that governmental pressures (GP) is a crucial factor of external stakeholders ( He et al., 2018 ). Variations in regulations and implementation of these changes by the government disturb organizational activities concerning environmental management ( Yakubu, 2017 ). In particular, to compete internationally, organizations must keep an eye on both international and national laws to overcome any obstacle. The consistency of the rules and organizations’ insights into the severity of the regulations will define the degree to which firms essentially execute environmental prevention practices ( Bernauer et al., 2007 ). The appropriate governance mechanisms and structural design can successfully manage and supervise the association between nature and mankind ( Famiyeh et al., 2018 ). Moreover, Tirabeni et al. (2019) showed that organizations are reevaluating their manufacturing processes in response to “societal and governmental” pressures concerned with eco-friendly well-being. Furthermore, the degree to which the government enforces/supports the regulations has a substantial influence on the firms’ environmental strategies ( Lindell and Karagozoglu, 2001 ; Zeng et al., 2011 ), creating a significant task to examine. A study by Zhang et al. (2019) on 224 firms of the manufacturing industry found that institutional pressure significantly affects green supply chain management practices and business performance. In a study by Huang et al. (2016) , results show that customer and regulatory pressure encourage green response and increase performance. A survey by Fernando and Wah (2017) , based on Malaysian firms, concluded that compliance with government regulations impacts environmental performance. Hence, we suggest hypothesis 2:

H 2 : Governmental pressure has a significant impact on GI practices.

Employee Conduct (EC)

Top management identifies the significance of environmental prevention and their responsibility to impact strategic planning and long-term goals related to environmental management. Steady appreciation and consideration of environmental drivers by the management should produce improved innovation and overall performance. Additionally, an organization’s future direction of ecological practices/activities mostly depends on the top management’s commitment toward the utilization of green practices and whether the executives can motivate employees to actively contribute to environmental management ( Tang et al., 2018 ). The same circumstances exist between employees. In a business, workforces are often the originators of environmental practices ( Daily and Huang, 2001 ). Organizations will strain to achieve ecological goals if the personnel/workforce do not contribute to their policies and strategies ( Zhu et al., 2008 ). Thus, firms must arrange and offer workshops and training on environmental concerns, include suitable employees, and improve their obligation to eco-friendly practices ( Reinhardt, 1999 ). Yen and Yen (2012) investigate the inside drivers motivating organizations to utilize green activities such as the top management commitment and relationships with vendors. The authors found a direct association between the proposed constructs of the study.

Furthermore, Gholami et al. (2013) examined senior managers’ perceptions about situations and the significances of using green practices. They presented that green technology acceptance, top management attitude, and apprehension for potential concerns are significantly interrelated. Moreover, they found an optimistic connection between the adoption of green practices and overall performance. The results from Cao and Chen (2018) study show that when the top management’s awareness increases, the association between coercive policies and GI strategy becomes stronger. Soewarno et al. (2019) propose that executives are responsible for making GI strategies that have to be implemented by employees. Such innovation strategies positively influence GI if applied appropriately. Thus, we propose hypothesis 3:

H 3 : EC has a significant impact on GI practices.

Environmental Performance

In this study, we have assessed the firms’ overall performance into two types: environmental and organizational. Environmental performance (EP) can be defined as “the environmental impact of a company’s activities on the natural surroundings” ( Klassen and Whybark, 1999 ). OP includes numerous elements, both financial and non-financial (e.g., market share, reputation, sales volume, stakeholders satisfaction, etc.) ( Venkatraman and Ramanujam, 1986 ).

Environmental performance encompasses the inclusion of eco-friendly ingredients in products, less pollution, reduced carbon emissions and waste at the source, advancements in energy-savings, efficiency in utilization of resources, reduction in the use of environmentally hazardous elements, etc. ( Zhu et al., 2010 ). Related to long-term ecological impacts, an organization’s regulatory methods, processes, practices including pollution protection, as well as resource utilization and waste lessening, are more fruitful than “end-of-pipeline solutions” ( Sarkis and Cordeiro, 2001 ; De Giovanni, 2012 ; Khan et al., 2019 ). Previous scholarships proposed that advancement in the production process and efficiency will upsurge opportunities to advance environmental performance ( Montabon et al., 2007 ). Along with these, a study by Seman et al. (2019) on the 123-manufacturing industry showed that GI practices significantly improve environmental performance. Hence, we established hypothesis 4:

H 4 : GI practices have a significant impact on environmental performance.

Organizational Performance

Organizational performance can be assessed both “financially and non-financially” ( Gounaris et al., 2003 ). To control environmental costs, organizations raise their productivity by adopting GI practices ( de Burgos-Jiménez et al., 2013 ). Similarly, organizations can establish new markets and upsurge their market share by employing and adopting environmental activities and practices ( Berry and Rondinelli, 1998 ; Berrone et al., 2017 ). A long-term organization goal, advancement into non-monetary performance can be demonstrated by enlarged customer loyalty, newly joined customers, and an improved image and reputation of an organization ( Blazevic and Lievens, 2004 ). Chen (2008a) suggested that innovators in GI will gain the “first-mover advantage,” which indicates an improved firm image, higher product prices, competitive advantages, and new market opportunities. A study by Tang et al. (2018) shows that GI practices have positive effects on OP. Moreover, a study by Zhang and Walton (2017) on 83 New Zealand firms concludes that GI has a positive influence on the firms’ performance. Thus, hypothesis 5 is constructed:

Hypothesis 5: GI practices have a significant impact on OP.

This study used IO as a moderator. It tested its effect on the association among EC and GI practices because the variable is allied with organizations’ policy settings and culture, which primarily correlate to the firm’s employees.

Innovation Orientation

Innovation orientation is a strategic orientation that disturbs firms’ innovation practices and functions as a guiding standard for making strategy and enactment to increase an organization’s innovativeness ( Chen et al., 2011 ; Stock and Zacharias, 2011 ). It defines a firms’ “openness to new ideas, technologies, skills, resources, and administrative systems” ( Zhou et al., 2005 ) and a knowledge-sharing system that unites a learning viewpoint, strategic guidelines, and trans -functional acclimation within a firm to encourage innovation ( Siguaw et al., 2006 ). IO is a crucial factor in overwhelming competitors and advancing an organization’s capability to effectively execute new products, services, systems, and processes ( Oke, 2007 ). Organizations with a new innovative environment and management will motivate and encourage employees to commence innovative conduct ( Ramus, 2018 ). Thus, we assume that an IO can advance the association between EC and GI practices, as exemplified in hypothesis 6:

H 6 : IO significantly moderates EC on GI practices.

Research Methodology

Based on a review of the literature, we considered a structured closed-ended questionnaire with 7 s. The first section includes the demographical information of respondents. The second to seventh sections include the measurement items related to specific construct’s competitors’ pressure, governmental pressure; EC; IO; GI practices; environmental performance, and OP. To ensure the validity of the questionnaire and data, two pilot studies were conducted. After that step, we adopted a field survey on a large scale. All of the construct’s items were measured using “five-point Likert-type scales in which 1 = strongly disagree, 5 = strongly agree.”

Data Collection and Sample

Data were collected from January 2019 to July 2019 from the manufacturing and services firms of Punjab province in Pakistan that have adopted GI practices. Convenient random sampling techniques were adopted for selecting areas of the country. Most of the organizations are based in Lahore, Faisalabad, Sheikhupura, Gujranwala, and Multan. Data collected by field surveys targeted the population, including the executives of different departments such as marketing, human resource, productions, operations, and other functional managers. After the pilot study’s conduction, 550 questionnaires were distributed among the respondents, out of which 520 were filled and returned. This resulted in a response rate of 94.54% from a random sampling method for data collection. Five forms were removed from the analysis due to incomplete information, and the remaining 515 were used in the analysis.

Measures of the Constructs

This study adopted a quantitative research technique and a closed-ended questionnaire used for data collection. All of the variables were assessed with multiple-item scales. In total, 46 question items, mainly related to the constructs, were used. Competitor pressure was appraised by acclimating four items from preceding studies ( Christmann, 2004 ). GP were measured by four items scale adapted from the studies of Zeng et al. (2011) and Qi et al. (2010) . EC was measured by four items scale taken from Lindell and Karagozoglu (2001) studies and López-Gamero et al. (2008) . IO was measured by seven items scale gained from the studies of Hurley and Hult (1998) ; Zhou et al. (2005) , and Siguaw et al. (2006) . In this study, GI practices were measured by nine items scale taken from the study of Chiou et al. (2011) . OP measured by eight items scale adapted from the study of Blazevic and Lievens (2004) and Avlonitis et al. (2001) . Moreover, the environmental performance was measured by six items scale adapted from Lin (2013) studies.

Common Method Bias

We used Harman’s single factor test to check the issue of common method bias in the data. As per Harman’s methodology, if all the factors merged into factor analysis, and the first factor explains more than 50% of the data variance, there is an issue of common method bias. Therefore, we used the dimension reduction method in SPSS and merged all the factors into one factor using a rotation matrix. The first factor’s results explained 38.23% of the total variance, which is less than 50% of the variance. Thus, common method bias is not considered as the problem in this study.

Data Analysis and Results

This study used the partial least squares (PLS) procedure of structural equation modeling using Smart-PLS Version 3.0 to assess the research model. This procedure was designated due to the investigative nature of the study ( Hair et al., 2011 ). As recommended by Hair et al. (2013) , this research applied a two-step method for statistical analysis. In the first step, the measurement model was analyzed. In the second step, the structural relationships among the latent constructs were assessed. This tactic was used to conclude both the reliability and validity of the theoretical variables before the model’s structural relationship was tested. Furthermore, Smart-PLS’s main reason includes the extensive popularity and acceptability of its application ( Hair et al., 2012 ). It also includes comprehensive information about the variables ( Hair et al., 2011 ).

Sample Demographics

A sample of 515 employees represents the telecommunication sector population in China, and demographical representation was shown in Table 1 . 392 (76.1%) respondents are male, and the rest, 123 (23.9%) respondents are female. Also, 246 (47.8%) respondents fall in the range of 31–40 years, followed by 219 (42.5%) in 20–30 years. From the education perspective, 291 (56.5%) respondents have a master’s degree, followed by 216 (41.9%) with a graduation degree, and the remaining (1.6%) with higher than master degree education, respectively. Furthermore, 218 (42.3%) respondents have a job in the sales and marketing department, 209 (40.6%) selected “other options,” apart from the HR and finance department. As for work experience, 260 (50.5%) respondents have 5–10 years of experience, followed by 127 (24.7%) with 1–5 years and the rest (24.3%) with 11–15 years of experience, respectively. As mentioned in the table below, 168 (32.6%) respondents have a monthly income of more than 60,000 rupees. Out of 515 respondents, 333 (64.7%) are married, and the rest, 182 (35.3%), are single.

Table 1. Demographical information.

Measurement of Model

The partial least square method was used to measure the reliability and validity of the respective constructs. The constructs’ internal reliability was evaluated by “Cronbach’s Alpha (CA), and Composite reliability.” According to Gefen et al. (2000) and Hair et al. (2013) , CA should be greater than 0.7. Moreover, Hinton (2014) categorized four ranges of CA. First, if the value falls in the range of 0.9, it falls in the area of excellent reliability. Second, if it falls between 0.7 and 0.9, it will have high reliability. Third, if it is in the range of 0.5 to 0.7, it will fall into the moderate area. Fourth, if it is <0.5, it will be categorized as low. Table 2 shows that all of the variables have values (e.g., CP = 0.851; GP = 0.829; EC = 0.851; IO = 0.764; GIP = 0.829; EP = 0.799; and OP = 0.892) which fall into the range of high reliability. Furthermore, to evaluate the convergent validity, the average variance extracted (AVE) is used. Fornell and Larcker (1981) and Bagozzi and Yi (1988) propose that AVE’s value should be greater than 0.5. As per results found in the table, all the values of constructs (0.691; 0.654; 0.627; 0.585; 0.598; 0.651; and 0.650) satisfied the rule of thumb. Chin (1998) recommended that loadings have a value greater than 0.5 because it indicates the constructs’ reliability. The item’s value can be between 0.4 and 0.7, as the value is also used by Umrani et al. (2018) . Hence, all the loading values are found in the range of 0.477 to 0.894. Hence, it is proved that all the values satisfied the rule of thumb established by the scholars.

Table 2. Measurement model.

Two methods were used to evaluate the discriminant validity (e.g., used to measure either construct used in the study well defined). Each construct is pure and not any multicollinearity involved. The dependent variable was evaluated by considering the correlations between the measures of hypothetically intersecting variables) of the variables. First, it was ensured that the cross-loadings of indicators should be greater than any other opposing constructs ( Hair et al., 2012 ). Second, according to the criterion of Anderson and Gerbing (1988) and Fornell and Larcker (1981) , the “square root of AVE for each construct should exceed the inter-correlations of the construct with other model constructs” ( Table 3 ). Hence, both methods ensured the satisfaction of the results and validity. All the results found in the study meet satisfactory status.

Table 3. Discriminant validity coefficients.

Another essential technique of partial least square to assess the model’s validity and multicollinearity includes the Heterotrait–Monotrait ratio. According to Henseler et al. (2015) . HTMT is the ratio of trait correlation to within correlation. The belief that if the HTMT value is going to increase >0.9, it will lack the discriminant validity, as mentioned in Table 4 . Furthermore, it is considered one of the most crucial technique to measure the multicollinearity.

Table 4. Heterotrait – Monotrait (HTMT) ratio.

Structural Model

The table given below contains the values of the coefficient of determination. It shows the percentage change in the dependent variable incurred because of independent variables. Hair et al. (2010) defined it as the proportion determined by independent variables. In other words, it tells how much change in dependent variable incurs because of the independent variable. Table 5 shows three models. In the path – 1: R 2 of GI practice, have a positive coefficient 0.716, and adjusted R 2 0.713. It entails that 71.6% of changes in GIP incur because of all the independent variables. Path – 2 exhibited a 31.7% change in EP. While path – 3 showed a 31.6% change in OP incurred because of all the independent variables. According to Hair et al. (2011) and Henseler et al. (2015) , three values of the coefficient of determination, 0.75, 0.5, or 0.25, which are called substantial, moderate, or weak, respectively. If the co-efficient of determination falls within the range of 0.75 or greater, it will become significant. If it is between 0.25 and 0.75, it will become moderate. If it falls below 0.25, it will be considered weak. Hence, the study’s value, which is shown in the table underneath, falls in a moderate range.

Table 5. Analysis of R 2 .

Analysis and Discussion

The competitors’ pressure, governmental pressure, EC, and GI practices are concentrated on environmental and OP. The manufacturing and servicing industries of the country were examined, which account for greater than 70% contribution to the GDP of the country. A cohesive framework was developed under the investigation of theory, and it stated that the stakeholders’ dimensions have positive and significant effects on the GI practice, and which, in turn, has positive and significant impacts on environmental and OP.

In the study, six hypotheses were constructed. Among them, five were a direct hypothesis, and one was proposed for the moderation effect. As exhibited in Table 6 and Figure 2 , the first direct hypothesis H 1 related to the influence of competitor pressure on GI practices. The findings show that competitive pressure positively and significantly impacts GI practices with a coefficient value of 0.271, t -value 5.543 > 2, and p -value 0.000 < 0.05. The hypothesis results were found consistent with the study of El-Kassar and Singh (2019) . Moreover, we tested H 2 governmental pressure positively related to GI practices. The results indicate that governmental pressure positively and significantly impacts GI practices with a positive coefficient value of 0.123, t -value 4.598 > 2, and p -value 0.000 < 0.05. The second direct hypothesis H 2 , won the vote of support and was consistent with the results from a previous study of Sezen and Çankaya (2013) and Fernando and Wah (2017) . Our third hypothesis, H3, is associated with EC and GI practices. The output illustrates that EC positively influenced GI practices with coefficient value of 0.185, t -value 4.368 > 2, and p -value 0.000 < 0.05. Hypothesis results were found consistent with the study of Yen and Yen (2012) , Gholami et al. (2013) , and Soewarno et al. (2019) .

Table 6. Path coefficients and hypothesis testing.

Figure 2. Structural model of the study.

Furthermore, we discussed the H 4 the direct effect of GI practices on OP. The findings show that GI practices positively and significantly affect OP with a positive coefficient value of 0.563, t -value 14.653 > 2, and p -value 0.000 < 0.05. Hypothesis results were consistent with the previous study of Seman et al. (2019) . Besides, we tested the direct effect of GI practices on environmental performance. We found that GI practices positively related to environmental performance with a positive coefficient of 0.562, t -value 16.15 > 2, and p -value 0.000 < 0.05. The hypothesis was supported and consistent with the studies of Zhang and Walton (2017) and Tang et al. (2018) . Finally, the sixth hypothesis H 6 was constructed for moderation interaction effects, and its results were found statistically significant with a negative coefficient value of −0.063, t -value 3.137 > 2, and p -value 0.000 < 0.05. In conclusion, the results of all direct hypotheses were found with a positive path coefficient and statistically significant with a t -value > 2 and p -value < 0.05 and the interaction graph presented in Figure 3 . However, the moderation hypothesis was found statistically significant, with a negative coefficient value. Therefore, it is proven that all the variables used in the study affect GI practices and the firms’ overall performance.

Figure 3. Interaction graph EC × IO and GIP.

Conclusion and Implications

“Go green” has been forcing internationally dynamic organizations to improve their green competencies endlessly, execute GI practices to prevent the environment from degrading further, and advance overall firms’ performance. Therefore, this study aims to identify the key factors affecting on the GI practices and its impact on OP from stakeholders’ perspectives. From the results, it is concluded that competitive pressure has a positive and significant impact on GI practices ( Abrahamson and Rosenkopf, 1993 ; Cai and Li, 2018 ; Durand and Georgallis, 2018 ; Singh and El-Kassar, 2018 ; Yu, 2019 ) as well as that governmental pressure has a positive and significant impact on GI practices ( Lindell and Karagozoglu, 2001 ; Bernauer et al., 2007 ; Zeng et al., 2011 ; Huang et al., 2016 ; Fernando and Wah, 2017 ; Yakubu, 2017 ; Famiyeh et al., 2018 ; He et al., 2018 ; Tirabeni et al., 2019 ; Zhang et al., 2019 ). Furthermore, it can be seen from our results that employee’s conduct is positively influenced by GI practices ( Reinhardt, 1999 ; Daily and Huang, 2001 ; Zhu et al., 2008 ; Yen and Yen, 2012 ; Gholami et al., 2013 ; Cao and Chen, 2018 ; Tang et al., 2018 ; Soewarno et al., 2019 ). Also, our results conclude that GI practices have a positive and significant effect on OP ( Berry and Rondinelli, 1998 ; Gounaris et al., 2003 ; Blazevic and Lievens, 2004 ; Chen, 2008a ; de Burgos-Jiménez et al., 2013 ; Berrone et al., 2017 ; Zhang and Walton, 2017 ; Tang et al., 2018 ). The findings of the study suggest that GI practices positively related to environmental performance. From the findings, it is also concluded that the moderation effect of IO was found statistically significant but with a negative coefficient value. The study also describes significant implications and suggestions to the managers and policymakers.

Implications

The present study delivers numerous researches “contributions and managerial implications.” First, this study presented that GI practices disturb not only EP but also OP. GI should be seen not only as responsive contentment of management requirements but as a pre-emptive exercise to advance a competitive advantage and the firm’s performance ( de Burgos-Jiménez et al., 2013 ). This pragmatic sign proposes that when organizations generously emphasize GI practices, they can promote both “financial and non-financial” performance. Top management executives can play a crucial role in carrying the significance of GI to all stakeholders. Second, both industrial and service organizations were investigated in the model. The data collected from both the sectors/industries showed no difference, and the results were the same. “Go green” is a significant issue for both divisions. GI practices need to be endlessly accepted in the product, process, marketing, management innovation, or all, regardless of industry. Finally, this study showed a statistically significant moderation effect of IO on EC concerning GI practices. However, we propose that the top management or executives accentuate innovation and inventiveness in their firm’s culture. The effort to raise the constituents of innovation is critical to the existence and sustainability of firms.

Limitations and Further Research

Although this research study delivers valuable intuitions, some limitations should fuel further investigations. First, the study was conducted in Pakistan, which only included significant areas of the country; small cities were ignored in the research. Second, an executive’s insights into GI practices and consequences are stranded in specific-industry norms. However, to focus on the conclusions’ larger generalizability, we invite scholars to replicate our study but in diverse perspectives and countries. Future studies should include other dimensions of the stakeholders’ view with the mediation of market innovation and management innovation. HR practices can also moderate the relationship between stakeholders’ views and GI practices. Last, the mediation effects need to be explored further.

Data Availability Statement

The raw data supporting the conclusions of this article will be made available by the authors, without undue reservation.

Ethics Statement

This study was carried out in accordance with the recommendations of the Ethical Principles of Psychologists and Code of Conduct of the American Psychological Association (APA). All participants gave written consent in accordance with the Declaration of Helsinki. The studies involving human participants were reviewed and approved by the Ethics Committee of the Lahore School of Business, University of Lahore, Pakistan. The patients/participants provided their written informed consent to participate in this study.

Author Contributions

MK, HW, and DA: the provision of materials (i.e., questionnaires) and principal manuscript writing. MM, FS, and FA: data collection and manuscript revision and proofreading. MK and HW: data analysis plan. FS and FA: data analysis. All authors contributed to definition of research objectives, models, and hypotheses and approved the final version of the manuscript.

Conflict of Interest

The authors declare that the research was conducted in the absence of any commercial or financial relationships that could be construed as a potential conflict of interest.

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Descriptive statistics.

Keywords : innovation orientation, competitor pressure, employees’ conduct, green innovation, environmental performance, organizational performance

Citation: Wang H, Khan MAS, Anwar F, Shahzad F, Adu D and Murad M (2021) Green Innovation Practices and Its Impacts on Environmental and Organizational Performance. Front. Psychol. 11:553625. doi: 10.3389/fpsyg.2020.553625

Received: 19 April 2020; Accepted: 03 November 2020; Published: 18 January 2021.

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Copyright © 2021 Wang, Khan, Anwar, Shahzad, Adu and Murad. This is an open-access article distributed under the terms of the Creative Commons Attribution License (CC BY) . The use, distribution or reproduction in other forums is permitted, provided the original author(s) and the copyright owner(s) are credited and that the original publication in this journal is cited, in accordance with accepted academic practice. No use, distribution or reproduction is permitted which does not comply with these terms.

*Correspondence: Muhammad Aamir Shafique Khan, [email protected] ; Farooq Anwar, [email protected]

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A Groundbreaking Scientific Discovery Just Gave Humanity the Keys to Interstellar Travel

In a first, this warp drive actually obeys the laws of physics.

If a superluminal—meaning faster than the speed of light—warp drive like Alcubierre’s worked, it would revolutionize humanity’s endeavors across the universe , allowing us, perhaps, to reach Alpha Centauri, our closest star system, in days or weeks even though it’s four light years away.

However, the Alcubierre drive has a glaring problem: the force behind its operation, called “negative energy,” involves exotic particles—hypothetical matter that, as far as we know, doesn’t exist in our universe. Described only in mathematical terms, exotic particles act in unexpected ways, like having negative mass and working in opposition to gravity (in fact, it has “anti-gravity”). For the past 30 years, scientists have been publishing research that chips away at the inherent hurdles to light speed revealed in Alcubierre’s foundational 1994 article published in the peer-reviewed journal Classical and Quantum Gravity .

Now, researchers at the New York City-based think tank Applied Physics believe they’ve found a creative new approach to solving the warp drive’s fundamental roadblock. Along with colleagues from other institutions, the team envisioned a “positive energy” system that doesn’t violate the known laws of physics . It’s a game-changer, say two of the study’s authors: Gianni Martire, CEO of Applied Physics, and Jared Fuchs, Ph.D., a senior scientist there. Their work, also published in Classical and Quantum Gravity in late April, could be the first chapter in the manual for interstellar spaceflight.

POSITIVE ENERGY MAKES all the difference. Imagine you are an astronaut in space, pushing a tennis ball away from you. Instead of moving away, the ball pushes back, to the point that it would “take your hand off” if you applied enough pushing force, Martire tells Popular Mechanics . That’s a sign of negative energy, and, though the Alcubierre drive design requires it, there’s no way to harness it.

Instead, regular old positive energy is more feasible for constructing the “ warp bubble .” As its name suggests, it’s a spherical structure that surrounds and encloses space for a passenger ship using a shell of regular—but incredibly dense—matter. The bubble propels the spaceship using the powerful gravity of the shell, but without causing the passengers to feel any acceleration. “An elevator ride would be more eventful,” Martire says.

That’s because the density of the shell, as well as the pressure it exerts on the interior, is controlled carefully, Fuchs tells Popular Mechanics . Nothing can travel faster than the speed of light, according to the gravity-bound principles of Albert Einstein’s theory of general relativity . So the bubble is designed such that observers within their local spacetime environment—inside the bubble—experience normal movement in time. Simultaneously, the bubble itself compresses the spacetime in front of the ship and expands it behind the ship, ferrying itself and the contained craft incredibly fast. The walls of the bubble generate the necessary momentum, akin to the momentum of balls rolling, Fuchs explains. “It’s the movement of the matter in the walls that actually creates the effect for passengers on the inside.”

Building on its 2021 paper published in Classical and Quantum Gravity —which details the same researchers’ earlier work on physical warp drives—the team was able to model the complexity of the system using its own computational program, Warp Factory. This toolkit for modeling warp drive spacetimes allows researchers to evaluate Einstein’s field equations and compute the energy conditions required for various warp drive geometries. Anyone can download and use it for free . These experiments led to what Fuchs calls a mini model, the first general model of a positive-energy warp drive. Their past work also demonstrated that the amount of energy a warp bubble requires depends on the shape of the bubble; for example, the flatter the bubble in the direction of travel, the less energy it needs.

THIS LATEST ADVANCEMENT suggests fresh possibilities for studying warp travel design, Erik Lentz, Ph.D., tells Popular Mechanics . In his current position as a staff physicist at Pacific Northwest National Laboratory in Richland, Washington, Lentz contributes to research on dark matter detection and quantum information science research. His independent research in warp drive theory also aims to be grounded in conventional physics while reimagining the shape of warped space. The topic needs to overcome many practical hurdles, he says.

Controlling warp bubbles requires a great deal of coordination because they involve enormous amounts of matter and energy to keep the passengers safe and with a similar passage of time as the destination. “We could just as well engineer spacetime where time passes much differently inside [the passenger compartment] than outside. We could miss our appointment at Proxima Centauri if we aren’t careful,” Lentz says. “That is still a risk if we are traveling less than the speed of light.” Communication between people inside the bubble and outside could also become distorted as it passes through the curvature of warped space, he adds.

While Applied Physics’ current solution requires a warp drive that travels below the speed of light, the model still needs to plug in a mass equivalent to about two Jupiters. Otherwise, it will never achieve the gravitational force and momentum high enough to cause a meaningful warp effect. But no one knows what the source of this mass could be—not yet, at least. Some research suggests that if we could somehow harness dark matter , we could use it for light-speed travel, but Fuchs and Martire are doubtful, since it’s currently a big mystery (and an exotic particle).

Despite the many problems scientists still need to solve to build a working warp drive, the Applied Physics team claims its model should eventually get closer to light speed. And even if a feasible model remains below the speed of light, it’s a vast improvement over today’s technology. For example, traveling at even half the speed of light to Alpha Centauri would take nine years. In stark contrast, our fastest spacecraft, Voyager 1—currently traveling at 38,000 miles per hour—would take 75,000 years to reach our closest neighboring star system.

Of course, as you approach the actual speed of light, things get truly weird, according to the principles of Einstein’s special relativity . The mass of an object moving faster and faster would increase infinitely, eventually requiring an infinite amount of energy to maintain its speed.

“That’s the chief limitation and key challenge we have to overcome—how can we have all this matter in our [bubble], but not at such a scale that we can never even put it together?” Martire says. It’s possible the answer lies in condensed matter physics, he adds. This branch of physics deals particularly with the forces between atoms and electrons in matter. It has already proven fundamental to several of our current technologies, such as transistors, solid-state lasers, and magnetic storage media.

The other big issue is that current models allow a stable warp bubble, but only for a constant velocity. Scientists still need to figure out how to design an initial acceleration. On the other end of the journey, how will the ship slow down and stop? “It’s like trying to grasp the automobile for the first time,” Martire says. “We don’t have an engine just yet, but we see the light at the end of the tunnel.” Warp drive technology is at the stage of 1882 car technology, he says: when automobile travel was possible, but it still looked like a hard, hard problem.

The Applied Physics team believes future innovations in warp travel are inevitable. The general positive energy model is a first step. Besides, you don’t need to zoom at light speed to achieve distances that today are just a dream, Martire says. “Humanity is officially, mathematically, on an interstellar track.”

Before joining Popular Mechanics , Manasee Wagh worked as a newspaper reporter, a science journalist, a tech writer, and a computer engineer. She’s always looking for ways to combine the three greatest joys in her life: science, travel, and food.

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Green transition should be funded by joint EU debt, says Patrizia Toia MEP

Ensuring European industries can compete while achieving Green Deal targets should be a priority of the next mandate

MEP Patrizia Toia. Photo credits: Frédéric Marvaux / European Union

A bigger EU budget is needed to ensure industry in Europe is not left behind by Green Deal legislation, and the answer could lie in replicating the EU’s response to COVID-19, the vice chair of the European Parliament’s industry, research and energy committee (ITRE) has told Science|Business.

Patrizia Toia, who is running for re-election in June, says her priority for the next mandate will be to push for a “real European industrial plan”, that enables sustainability targets to be met without handing a competitive advantage to manufacturers outside the EU.

Toia pointed to the case of solar panels, where sustainability targets combined with an inadequate industrial strategy have left the EU reliant on imports from China . There is a broad understanding in Brussels of the need to avoid repeating this mistake.

The industrial plan should be funded by strengthening the overall EU budget for the 2028-2034, and in addition “fresh money [should] be channelled into the sustainable conversion of our industrial production”, said the Italian MEP, of the S&D group.

One suggestion is to look to the model of NextGenerationEU, the €800 billion instrument that was set up to help member states recover from the pandemic, as a potential source of additional funds. “If there is one lesson learned from the pandemic, it will be that nothing is impossible when political will exists,” Toia said.

NextGenEU provides member states with grants and loans for investment in areas including health, sustainability and digital. In a major first for the EU, it is funded by joint debt, but the programme is due to expire in 2026.

In recent months, several prominent figures have called for the EU to extend its common borrowing. French president Emmanuel Macron and Estonian prime minister Kaja Kallas have suggested issuing joint bonds to fund increased defence spending, while the EU’s economy commissioner Paolo Gentiloni pitched a similar instrument for research and innovation. Macron repeated his plea while visiting Germany this week, calling for the EU budget to be doubled, “through common borrowing strategies or the instruments that already exist.”

Research and innovation play a crucial role in competitiveness, meaning a solid framework programme is also required, Toia said. “A programme such as Horizon Europe investing in R&I is an indispensable tool for the realisation of the union's strategic objectives.”

While several MEPs and research organisations have called for the next research programme FP10, to have double Horizon Europe’s €95.5 billion budget , Toia’s primary goal is to ensure the budget is “not less than €100 billion.”

Changes to EU research programmes

June will mark 20 years since Toia was first elected to the European Parliament in 2004. She has been a member of ITRE since then, and in that time has seen major changes to the EU’s framework research programme.

“Whereas within FP6 and FP7 the focus was more on technological research, with FP8 [Horizon 2020] the focus began to turn additionally on open science and innovation,” she said. Each major reform was followed by a considerable increase in the budget.

Over the past few years, member states have repeatedly turned to Horizon Europe as an easy source of money to fund other priorities, from supporting Ukraine to supporting critical technologies through the Strategic Technologies for European Platform .

Even before Horizon Europe was launched, MEPs had to fight to defend its budget . Toia highlights the role of fellow Italian David Sassoli, the late president of the European Parliament, who pushed to prevent further cuts early in the mandate. “This is part of the immense legacy he left us, as the great pro-European and humanist that he was,” she said.

Now the research world is worried that the move to strengthen Europe’s defence capabilities will draw funding away from other areas of research. In January the Commission published a white paper proposing three different options for boosting research with both civilian and military applications, including removing the exclusive civil focus in parts of Horizon Europe.

“Unfortunately, the past few years have been telling us that our defence ambitions must be reinvigorated, and research is naturally the first pillar to be reinforced,” Toia said, noting she has, “always been very critical on the possibility of opening up funding to more dual use research.”

Toia was involved in the creation of the European Defence Fund, the €8 billion military research programme launched in 2021, after taking over as shadow rapporteur for the file in 2019.

She is also a member of STOA, the Parliament’s scientific advice panel, and last year proposed launching a study on whether FP10 should adopt a strategy of “evolution or disruption,” which she hopes will be picked up in the next mandate.

“We have been witnessing radical paradigm shifts on the world scene, therefore, it is strategic that the next FP10 policy setting process should follow a foresight approach and respond to the needs in the long term,” Toia said.

STOA’s leadership came in for criticism last year when it delayed the publication of a study on the EU’s pharmaceutical reform until the authors had responded to members’ questions, but Toia says being a member of the panel has been a worthwhile experience. “I could see the added value for my work of relying on independent information about developments in science and technology.”

As the election campaign nears an end, she believes citizens are interested in science even if they don’t know the ins and outs of EU policy. “People react positively if they feel they are listened to and engaged. Our job is to reinforce this bond of trust, and I do not ever shrink from this responsibility,” she said.

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Green innovations and environmentally friendly technologies: examining the role of digital finance on green technology innovation

• Research Article
• Published: 24 November 2023
• Volume 30 , pages 124078–124092, ( 2023 )

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The digital finance created by technological empowerment has a significant impact on the inventive behavior of micro-enterprises. This paper uses a correlation analysis that combines the fixed effect model (FE) and the panel threshold model (PTM) to evaluate the impact of digital financing on the quantity and quality of innovation in green technology. In addition, its process is dissected in this work with respect to resource limitations and financial expenditures. The empirical evidence demonstrates that the use of digital financing considerably increases both the rate and quality of innovation in environmentally friendly technologies. Further, the effect of user engagement on green innovation is dynamically overlaid and accumulates over time, as opposed to the coverage of digital finance and digital services. In terms of ownership, growth cycle, and company size, digital finance may assist remedy the misallocation of financial resources and further drive inclusive green innovation. Based on the examination of underlying mechanisms, it is clear that digital finance may play a significant role in fostering innovation in environmentally friendly technologies by easing financial limitations and decreasing associated costs. Depending on the context, “quantitative change before qualitative change” describes the dynamic development process of green innovation fueled by digital finance. This paper proposes that the combination of technological innovation and digital financial services should focus on establishing an inclusive digital financial service system, fostering diverse financial forms, and enhancing the market environment for digital financial services.

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The dynamic impact of digital finance on green innovation: evidence enterprise-level empirical data in China

Examining the Transformative Influence of Digital Finance on Green Technological Innovation: Empirical Insights from China

The impact of digital finance on green innovation: resource effect and information effect

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Cai, Y. Green innovations and environmentally friendly technologies: examining the role of digital finance on green technology innovation. Environ Sci Pollut Res 30 , 124078–124092 (2023). https://doi.org/10.1007/s11356-023-31094-3

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Received : 22 August 2023

Accepted : 14 November 2023

Published : 24 November 2023

Issue Date : December 2023

DOI : https://doi.org/10.1007/s11356-023-31094-3

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