Nexus of institutional pressures, environmentally friendly business strategies, and environmental performance

Institutional pressures (IP) have a strong effect on organizational strategies and decision making. IP in terms of coercive, mimetic, and normative forces have a direct effect on organizations to develop environmentally friendly business strategies (EFBS) and improve environmental performance (EP). The aim of this study is to examine the effect of IP on EP. Moreover, the mediating role of EFBS in the relationship between IP and EP has also been tested. Results reveal that IP significantly and positively affect EFBS. Moreover, the relationship between EFBS and EP is also significantly positive. However, the direct relationship between IP and EP is weak. The results of the study also confirm that EFBS mediate the relationship between IP and EP. These findings suggest that managers should develop green strategies for the improvement of environmental performance. This study not only offers the empirical evidence to validate the findings of past researchers but also provides insight how IP flourish the mechanism of environmentally friendly business strategies. Furthermore, this study highlighted some interesting facts that should be meaningful options for managers to enhance the environmental performance.