Harnessing Green Intellectual Capital for Sustainable Development: The Dynamic Capabilities Approach to Environmental Policy

ABSTRACT This research explores the critical role of Green Intellectual Capital (GIC) in fostering business sustainability within the Indian hotel industry, with a particular focus on the mediating effect of dynamic capabilities. GIC comprises three key components such as Green Human Capital (GHC), Green Relational Capital (GRC), and Green Structural Capital (GSC). Dynamic capabilities, which enable organizations to sense, seize, and transform resources in response to environmental changes, play a crucial role in enhancing the relationship between GIC and sustainability outcomes. Using a quantitative approach, a survey was conducted with 400 professionals from the Indian hotel sector. Structural equation modeling (SEM) was applied to examine the relationships between GIC, Dynamic capabilities, and Business sustainability. The findings reveal that GHC and GRC have significant direct effects on business sustainability, while GSC's impact is primarily mediated by dynamic capabilities. The results emphasize that dynamic capabilities allow hotels to adapt and innovate in the face of sustainability challenges, ensuring long‐term business viability. This work addresses a gap in the existing literature by focusing on the hospitality sector in a developing economy, offering practical insights for hotel managers to leverage GIC and dynamic capabilities to improve sustainability. It also contributes to theoretical frameworks by integrating the Resource‐Based View (RBV) and Dynamic Capabilities theories. Future research could expand to other sectors and explore additional mediating variables.