Concentrate or Diversify? Unraveling the Effect of Customer Concentration on Green Innovation

While the engineering management literature suggests that major customers exert an impact on firms’ engagement in green innovation, there are controversial views regarding the role of customer concentration in affecting green innovation. Drawing upon the knowledge-based view and resource dependence theory, we propose that customer concentration has a nonlinear effect on green innovation. By utilizing a panel dataset of 2718 Chinese listed manufacturing firms from 2001 to 2020, we find that customer concentration has an inverted U-shaped association with green innovation. In addition, market share flattens this curvilinear association, whereas industry competition does not significantly influence this association. Overall, this article contributes to a nuanced understanding of the inverted U-shaped effect of customer concentration on green innovation and the boundary condition that shapes this effect.

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Publication Details

Journal
IEEE Transactions on Engineering Management
Published
2025-01-01
DOI
https://doi.org/10.1109/tem.2025.3556070
Citations
3
Primary Topic
Environmental Sustainability in Business
Type
article
Field-Weighted Citation Impact
6.22

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article

Concentrate or Diversify? Unraveling the Effect of Customer Concentration on Green Innovation

Jinan Shao, Weijiao Wang, Junfei Chu, Wuyue Shangguan et al.
3 citations
IEEE Transactions on Engineering Management
Environmental Sustainability in Business
6.22
article

Concentrate or Diversify? Unraveling the Effect of Customer Concentration on Green Innovation

Jinan Shao, Weijiao Wang, Junfei Chu, Wuyue Shangguan, Xiaoyan Huang, Huang Ying
article en
3 citations

Abstract

While the engineering management literature suggests that major customers exert an impact on firms’ engagement in green innovation, there are controversial views regarding the role of customer concentration in affecting green innovation. Drawing upon the knowledge-based view and resource dependence theory, we propose that customer concentration has a nonlinear effect on green innovation. By utilizing a panel dataset of 2718 Chinese listed manufacturing firms from 2001 to 2020, we find that customer concentration has an inverted U-shaped association with green innovation. In addition, market share flattens this curvilinear association, whereas industry competition does not significantly influence this association. Overall, this article contributes to a nuanced understanding of the inverted U-shaped effect of customer concentration on green innovation and the boundary condition that shapes this effect.

IEEE Transactions on Engineering ManagementVol. 72
University of Nottingham Ningbo China (CN), Central South University (CN), Xiamen University (CN)
National Natural Science Foundation of China, Natural Science Foundation of Hunan Province, Fundamental Research Funds for the Central Universities
Industry, innovation and infrastructure
Openalex Percentile: Top 5%
Environmental Sustainability in Business
6.22
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Concentrate or Diversify? Unraveling the Effect of Customer Concentration on Green Innovation — Jinan Shao, Weijiao Wang, et al. · IEEE Transactions on Engineering Management (2025) | TGRS Research Map | TGRS