The Effects of Sustainable Development on Technological Innovation Performance - An Empirical Approach Open Access

Ever since the release of the Brundtland Report by the World Commission on Environment and Development (WCED, 1987), the sustainable development (SD) concept has been gaining more and more traction from a majority of research disciplines in the recent two decades. For instance, the impact of sustainable development performance on firm financial performance have been studied by previous research study extensively. Many researchers, however, recognize the effects and significance of `technology' on climate change and sustainability assessment, and have proposed to include innovation and technology as an element of the sustainability debate. To this end, there has not been a quantitative study specifically dedicated to investigating sustainable development effects on organizations' technological innovation performance. The purpose of this research study was to examine the intertwined roles of `sustainable development' and `technological innovation'. We tested our hypotheses using structural equation models (SEM) to analyze secondary data in order to reveal the influences and relationships between the two variables. With a dataset structured for short-, mid- and long-term analyses, approximately 200 organizations were analyzed to reveal that: (1) organizations' sustainability performance may have positive influence on the technological innovative performance only within the same time periods. The reciprocal positive linkage of technological innovation performance to sustainability also appears to exist within the same time periods; (2) the impact of sustainability on technological innovation performance appears to be greater than the reciprocal effect generated from technological innovation performance; (3) sustainability performance significantly affects itself positively over different time periods. The same positive trend also exists for technological innovation performance over different time periods. These positive impacts are consistently observed in all short, mid and long terms; and (4) organizations in the high-tech and the medium-high-tech industries have been observed with statistically significant impacts only in the short-term period model. These industries dedicate a much higher annual spend level on encouraging technological innovation performance, as well as increasing productivity in innovative outputs than many other industries. However, they may not necessarily be dedicated resources to developing themselves in the sustainable manner as defined by WCED, particularly in the mid- to long run. These findings will ensure to urge managers and decision makers to look beyond communications, risk management and reputational concerns, and to further encourage solid organizational performance through corporate sustainability implementation and practices.

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