Despite the growing importance of environmental, social and governance (ESG) performance and digital culture, limited research has examined how these elements intersect and contribute to innovation capacity, especially among multinational firms. By drawing on the resource-based view, this study provides a theoretical foundation for understanding how intangible resources such as digital organizational culture, ESG performance and corporate reputation collectively affect innovation capacity.
The study developed and explored a serial mediation model to explain how ESG performance and corporate reputation can connect digital organizational culture to enhance innovation capacity. Data were collected from 355 senior and middle-level managers in large Asian and American multinational firms in Botswana. Purposive sampling was employed, and data were analyzed using structural equation modeling (SEM), with bootstrapping performed on 2,000 samples to determine direct and indirect effects in AMOS.
The results reveal that digital organizational culture positively influences ESG performance, ESG performance enhances corporate reputation and innovation capacity and corporate reputation positively impacts innovation capacity. Additionally, ESG performance and corporate reputation serially mediate the relationship between digital organizational culture and innovation capacity.
Firms should foster a digital culture that aligns with ESG goals to enhance their reputation and drive innovation.
This research highlights the critical role of digital organizational culture in enhancing ESG performance and corporate reputation, which subsequently boosts innovation capacity.
