This paper investigates the combined effect of internal environmental management (IEM) and green human resource management (GHRM) on corporate reputation (CR), environmental performance (EP) and financial performance (FP). The paper further explores the indirect effects of CR and EP between the direct paths.
Data are garnered from 164 firms from three industries in Ghana. Partial least square structural equation modeling (PLS-SEM) is the methodological technique used to test the hypothesized relationships.
The result demonstrates that unlike IEM which has a significant effect on FP when implemented in isolation, GHRM does not have a significant effect on FP. However, the joint implementation of IEM and GHRM can provide better results in terms of improved CR, enhanced EP and significant FP improvement. CR and EP were further found to mediate the relationship between the direct paths.
The results suggest that the joint implementation of IEM and GHRM is critical for firms that seek to enjoy superior reputation, enhance their environmental sustainability and achieve financial gains. Consequently, managers are strongly encouraged to create a sustainable and vibrant company via significant and rational investment in green initiatives like IEM and GHRM.
This study happens to be one of the first to develop a research model that investigates the joint effect of IEM and GHRM within the context of CR, environmental sustainability and FP.
