Climate Change, Strategic Orientation, and Green Innovation: Unpacking External and Internal Drivers in Competitive Contexts

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ABSTRACT Firms increasingly face political and societal pressures to pursue green strategies and sustainable innovation amid escalating climate change disruptions. Drawing upon contingency theory, institutional theory, and the natural resource‐based view, this article examines external (stakeholder pressures) and internal (environmental culture) antecedents shaping firms' strategic green orientation, and explores how competitive intensity moderates the relationship between strategic green orientation and green innovation. An analysis of 350 Italian green manufacturing firms using partial least squares structural equation modeling (PLS‐SEM) reveals that stakeholder pressures influence strategic green orientation more strongly than internal environmental culture, indicating firms prioritize external demands over intrinsic environmental values. Furthermore, while strategic green orientation positively enhances green innovation, heightened competitive intensity significantly weakens this effect. These findings contribute to a dual‐perspective understanding of how firms develop green strategies and emphasize competitive constraints on green innovation, offering valuable theoretical and practical insights for navigating sustainability challenges in highly competitive environments.

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