Knowledge, Coercion, and Norms: Understanding the Drivers of Environmental Corporate Social Responsibility and Green Innovation in Europe

ABSTRACT This paper explains why firms engage in the environmental pillar of corporate social responsibility (CSR). Drawing on the knowledge‐based view (KBV) and neo‐institutional theory, we posit that environmental CSR—operationalized as green innovation—reflects consequentialist adaptation to internal capabilities (explicit knowledge) and external constraints (coercive and normative isomorphism). We analyze both real and synthetic microdata calibrated to CIS 2022 patterns for EU firms and estimate principal component analysis (PCA), logistic regression, and a structural‐equation‐style model with robustness checks (alternative rotations, split samples, multicollinearity diagnostics). Our findings show that coercive isomorphism is the strongest correlate of green innovation, followed by explicit knowledge and normative pressures. The study reframes environmental CSR as a knowledge‐enabled response to credible institutional constraints, offering a transparent, policy‐relevant empirical architecture. Implications for policy, management, and society are discussed. We limit claims to association and provide extensive robustness analyses.