Mediating role of green marketing orientation in stakeholder risk and new product success relationship among European multinational enterprises in Ghana

Abstract

Purpose This study aims to assess the mediating role of green marketing orientation (GMO) dimensions in the relationship between stakeholder risk and new product success among European multinational enterprises (EMNEs) in Ghana. Design/methodology/approach The study was based on primary data gathered from 302 EMNEs in Ghana. After various validity and reliability checks, structural equation modeling in Amos (v.23) was performed to estimate the various relationships hypothesized in the study. Findings The study finds that stakeholder risk had a significant negative effect on the success of EMNEs’ new products. This negative effect is, however, nullified by the positive mediating effects of strategic green marketing orientation, tactical green marketing orientation and internal green marketing orientation. Research limitations/implications GMO is highly regarded as context-specific, with unique characteristics. Implying that the interpretation of results from the GMO framework should be on the backdrop of the social, cultural political and economic environment. Practical implications Stakeholder risk posed a significant challenge to the success of EMNEs, whose operations are monitored not just by domestic stakeholders but also international stakeholders. The actions and inactions of these EMNEs affect the overall image of the mother firm and are, therefore, expected to operate within acceptable norms. Social implications The adoption of GMOs increases the success of new products, as firms receive a social license for their environmentally friendly operations. GMO also helps in solving societal concerns for environmental protection, which is very paramount in this 21st century. Originality/value Past studies have largely focused on stakeholder pressure; however, this study focuses on the risks associated with those pressures and how these risks influence the success of new products.

Social risk, green market orientation, entrepreneurial orientation, and new product performance among European Multinational Enterprises operating in developing economies

“…A myriad of studies were conducted to examine the effect of stakeholder pressure on environmental performance and other performance related outcomes (Borah et al, 2022; Jiao et al, 2020; Nguyen & Adomako, 2021; Shubham et al, 2018). Again, other studies have also focused on how stakeholder pressures force or encourage firms to incorporate green innovation in their strategic orientation (Kawai et al, 2018; Rui & Lu, 2021; Singh et al, 2021; Zhang et al, 2020).…”

“…Again, not many studies have been done to assess the risks associated with pressures from stakeholders when it comes to Multinational Enterprises more especially EMNEs in foreign markets. For instance, Borah et al (2022) assessed the effect of stakeholder risk on new product performance and the mediating role of green market orientation but not the moderating effect of entrepreneurial orientation on the green market orientation and new product performance relationship. Nguyen and Adomako (2021) examined the role of stakeholder pressure on eco‐innovation of Vietnamese small‐ and medium‐sized enterprises (SMEs).…”

“…Social risks are perceived to have negative effect on business operations especially the introduction of new products, development timelines and capital expenditure, and image and reputations of firms (Borah et al, 2022; Kytle & Ruggie, 2005; Rio Tinto, 2011). Studies have also stressed the risk associated with stakeholders' pressure on organizations' image, reputations, and performance (Borah et al, 2022; Konadu et al, 2020; Otchere et al, 2021).…”

“…In an attempt to limit the strategic threat social risk possess to firms, Boutilier and Thomson (2011) encourage organizations to adopt social license thus economic legitimacy, socio-political legitimacy, interactional trust, and institutionalized trust. Other studies have also confirmed the influence of social risk on the practice of environmental marketing or green marketing (Borah et al, 2022;Nair & Menon, 2008;Nair & Ndubisi, 2011;Polonsky, 1995) but not its influence on internalizing green marketing culture. Though studies have recently conceptualized the green market orientation (e.g., Chahal et al, 2014;Papadas et al, 2017) and determined the influence of stakeholders' environmental pressure on strategic green market orientation (Papadas et al, 2019), not many studies have been conducted to determine how social risk stimulates the internalization of green marketing culture and its resultant outcomes in terms of new product performance.…”

“…Social risk according to Bekefi et al (2006) is challenges or potential negative consequences of stakeholder's action to companies' business as result of perceived or real business impacts on the natural environment or human life. Firms are said to have social contract with a group of individuals whose actions directly and indirectly affect organizations' existence, performance and new product performance (Backer, 2007; Borah et al, 2022; Freeman, 1984). This group of individuals per the definition of social risk include “businesses, financiers, executive governments, regulators and NGOs” (Graetz & Franks, 2015, p. 6).…”