Do institutional pressures promote green innovation? The effects of cross-functional coopetition in green supply chain management

PurposeGreen supply chain management is an effective, environment-friendly business practice. Based on institutional theory and dynamic capability theory, the study examines the effect of institutional pressures to implement green supply chain management (GSCM) on green innovation, by considering the mediation effects of cross-functional coopetition.Design/methodology/approachThis study conducted a survey of Chinese companies and collected 1,481 responses. The effects of institutional pressures for GSCM implementation were analyzed using partial least squares structural equation modeling (PLS-SEM).FindingsThis study finds that coercive pressure, normative pressure and mimetic pressure for GSCM implementation are sufficient conditions to promote green innovation. Normative and mimetic pressures have significant positive effects on cross-functional coopetition. Cross-functional coopetition not only mediates the relationship between normative pressure and mimetic pressure and green innovation but also represents a necessary condition for it to occur.Practical implicationsFirst, managers should comprehend environmental regulations, embrace social norms on the environment and focus on competitors' successful GSCM practices. Second, management can organize training and establish performance-based rewards for enhancing a cross-functional coopetitive mindset to effectively respond to institutional pressures. Third, companies should establish multi-functional groups and informal networking via social events to motivate interaction, knowledge sharing and creative tension to achieve green innovation.Originality/valueThis paper expands the application of institutional theory to investigate the antecedent effects of institutional pressures on cross-functional coopetition. In addition, the study deepens understanding of dynamic capability theory in analyzing dynamic processes of cross-functional coopetition based on three dimensions of sensing, seizing and reconfiguring and empirically examines its mediating effects on institutional pressures and green innovation.