How does green strategy orientation promote substantive green innovation? Evidence from Chinese manufacturing enterprises

Amidst the global shift toward green development, enterprises are increasingly compelled to undertake substantial green innovation (SGI) to facilitate their transformation into environmentally sustainable entities. Based on the resource-based view (RBV) and upper echelons theory, the study empirically analyzes the impact of green strategy orientation (GSO) on enterprise SGI. It reveals the mediating mechanism of environmental investment (EI) and human capital investment (HC), as well as the moderating role of CEO green experience (Green) and environmental uncertainty (EU). It uses data from 1,745 listed manufacturing enterprises in China from 2011 to 2022 as our sample. The study finds that: (1) GSO significantly impacts SGI, the finding that passes the instrumental variable method, Heckman two-stage method, PSM method, and a series of robustness tests. (2) EI and HC significantly mediate the GSO–SGI relationship. (3) Green and EU positively moderate the GSO–SGI relationship. (4) Heterogeneity analysis shows that enterprises with green investors’ attention and those with high regional market competition intensity are more likely to enhance SGI through GSO guidance. (5) Further analysis shows that GSO can enhance enterprise ESG performance by promoting SGI. This study has significantly contributed to the literature on green innovation and the combination of RBV and upper echelons theory.