Influence of Innovation Investment on Operational Efficiency and Business Growth of Environmental Protection Companies: Basis for Improved Business Performance Framework

Innovation investment is increasingly important to environmental protection companies seeking to improve organizational efficiency, sustain competitiveness, and respond to environmental and technological demands. This study examined the influence of innovation investment on the operational efficiency and business growth of environmental protection companies in Shandong Province, China, as the basis for developing an improved business performance framework. A quantitative descriptive-correlational design was employed. Data were collected through a researcher-developed questionnaire administered to 400 officers from five environmental protection companies who had knowledge of their organizations’ strategic, financial, and operational activities. Descriptive statistics, Spearman’s rho correlation, and multiple regression analysis were used to analyze the data. The findings indicated that the companies generally practiced innovation investment through research and development, technology adoption, and green innovation initiatives. Respondents likewise reported favorable operational efficiency in resource utilization, process optimization, and cost reduction, as well as favorable business growth in revenue turnover, market share expansion, and customer base growth. Innovation investment was positively and significantly associated with both operational efficiency and business growth. Research and development, technology adoption, and green innovation initiatives also significantly predicted the two organizational outcomes, with green innovation initiatives emerging as the strongest predictor. Operational efficiency was further positively associated with business growth. The findings support an integrated framework in which sustained investment in research, technological capability, and environmentally oriented innovation strengthens operational effectiveness and contributes to organizational growth. Environmental protection companies may therefore align innovation investments with efficiency, sustainability, and long-term growth priorities.