GREEN PROCESS INNOVATION AND FINANCIAL PERFORMANCE IN GROWTH AND MATURE FIRMS: GREEN INVESTMENT AS MODERATING VARIABLE

Abstract

This research aims to determine the effect of green process innovation on financial performance, and the role of green investment in strengthening the relationship between green process innovation and financial performance. The research used a sample of public manufacturing companies for the 2018-2022 period and divided them into two sample groups, namely growth and mature. The results of this research show that green process innovation has an effect on financial performance in mature stage companies and has no effect at the growth stage. Apart from that, green investment is able to strengthen the influence of green process investment on financial performance in growth stage companies, but is not able to strengthen it in the mature stage. Manufacturing companies, both in the growth and mature stages, can obtain positive returns on financial performance more quickly by focusing on green marketing which can help increase customer awareness, which can be done by sharing proactive information about the sustainability efforts made and when the product is finished by applying green label on products made by the company.