Environmental innovation and its impact on economic and environmental performance: Evidence from Korean-owned firms in China

This paper analyses the impact of environmental innovation on the economic and environmental performance of Korean-owned firms in China. We establish a theoretical model and propose eight hypotheses, which combine TPB (Theory of Planned Behavior) with theories of global environmental management and environmental innovation. We analyse the determinants of environmental innovation intention. We also analyse the effects of environmental innovation behavior on economic performance and environmental performance in different provinces and of different corporate ownership. We find that environmental innovation behavior has a greater effect on environmental performance than economic performance. Innovation in production processes, in particular, positively affects environmental performance for Korean-owned firms in Jiangsu. We also find that wholly Korean-owned firms (WKOEs) are more receptive to environmental innovation than Sino-Korean joint ventures. It is important to enhance environmental innovation within Korean-owned firms in China. Environmental innovation should concentrate on improving production processes in Jiangsu.