Impacts of institutional pressures and internal abilities on green performance of transport and logistics companies

Purpose Transport and logistics companies (TLCs) have adopted green practices to reduce their emission and waste in support of environmental protection requirements. However, not all green practices of TLCs have resulted in green performance (GP) because of inherent variations in internal abilities and external factors affecting firms in different operational environments. Using institutional (INT) and resource-based view (RBV) theories we develop a model that shows how institutional pressures and internal abilities impact TLCs’ GP. Design/methodology/approach Underpinned by INT and RBV theories, this study utilised structural equation modelling on a cross-sectional survey of 222 TLC firms operating in the Philippines. Findings The study reveals that TLCs’ regulatory compliance, social obligations and competitor pressures have significant direct effects on TLCs’ GP while supplier integration and resource capabilities serially mediate the relationships. The findings indicate that institutional pressures and internal abilities that shape firms’ environmental policies and procedures explain TLCs’ GP. Research limitations/implications As a result of the cross-sectional nature of our data, findings may be time, population and prevailing situation dependent. The long-term validity of the research can be improved if longitudinal design is employed. We collected data from a single respondent considered as the best respondent. However, with time and resource availability, a jury of executives for each company would have been a better alternative respondent. Practical implications The findings of this research provide TLC managers, policymakers and other stakeholders with much-needed guidance for crafting policies and strategies for handling the challenges of caring for the planet and maintaining sustainable operations. Social implications Improving green practices of TLCs to enable waste and emission reductions is critical to the health and well-being of people and the planet. An environment free of pollution will result in fewer health challenges, fewer medical/insurance-related expenses, and, above all, enable a higher quality of life and a more productive workforce. Originality/value Studies have extensively explored the green practices of TLCs as well as the influences of both institutional pressures and internal abilities of TLCs on their green practices. This study identifies critical factors that significantly affect the GP of TLCs and provides a conceptual framework for a better understanding of the dynamics of strategic, tactical and operational issues that TCLs may face in their effort at greening the sector.