Exploring the Role of Venture Capital in Advancing Green Innovation: A Systematic Literature Review

Venture capital (VC) is instrumental in overcoming financial barriers for companies focused on green innovation (GI), enabling them to scale their solutions and strengthen their competitiveness. Despite growing interest in this domain, knowledge remains fragmented. This study employs an integrated methodological approach, combining bibliometric analysis and a systematic literature review of Web of Science and Scopus data to identify key trends in GI financing through VC and uncover research gaps for future exploration. Of the 147 identified studies, 49 publications from 2006 to 2025 were included in the final analysis. The findings emphasize the need for further research to reconcile VCs' short-term financial objectives with their investments' long-term environmental impacts. Future studies should also examine the distinct approaches of various VC types—independent venture capital (IVC), corporate venture capital (CVC), and government venture capital (GVC)—toward GI, alongside geographical and cultural factors that influence investment outcomes. Additionally, the cleantech sector and potential synergies between public and private stakeholders warrant greater attention. This study contributes to the Resource-Based View (RBV) and Natural Resource-Based View (NRBV) theories by demonstrating how VC financing is a strategic tool for enhancing firms' competitive advantage and environmental sustainability. It offers valuable theoretical and practical insights for firms, investors, and policymakers. However, potential limitations include reliance on Web of Science and Scopus databases and a focus on English-language publications, which may have excluded relevant studies.