The Contingent Eco‐Innovation–Firm Performance Link

A Global Systematic Literature Review and Future Research Agenda

Bibliographic Data

ID22418652
AuthorsAli Mammadov (0000-0002-9289-4595, Business School University of Exeter Exeter UK)
Year2026
Publication date2026-03-05
Open AccessYes
TypeARTICLE
VenueBusiness Strategy and the Environment (JOURNAL)
Journal identifiersISSN: 0964-4733 • E-ISSN: 1099-0836
PublisherWiley (PUBLISHER • GB)
DOI10.1002/bse.70716
LanguageEN
References cited104

The relationship between eco‐innovation (EI) and firm performance (FP) is central to environmental management research, yet empirical evidence remains fragmented and highly context dependent. This article presents a global systematic literature review (SLR) of 541 empirical studies (2006–April 2025) to (i) diagnose the systematic sources of heterogeneity underlying this fragmentation and (ii) leverage that diagnosis to justify a strategic pivot from broad global mapping to a targeted, high‐rigor future research agenda. We identify the OECD as the most critical context for this next phase, where key inconsistencies can be resolved more cleanly. By systematically mapping variation in definitions, measurements, and contexts, we identify consistent patterns, pinpoint significant gaps and propose an integrative conceptual framework with review‐derived, testable hypotheses to guide more actionable research aligning environmental and economic objectives. Adhering to established SLR protocols, this review systematically searched Web of Science and Scopus. Data were extracted and analyzed focusing on EI definitions and types, FP measures (financial, environmental, operational, and social), methodologies, theoretical underpinnings, moderators/mediators (firm size, age, industry, capabilities, institutional factors), and geographical/sectoral contexts. The mapped studies exhibit marked heterogeneity in EI/FP conceptualization, measurement, and design, contributing to mixed results. The EI–FP link is generally positive yet highly contingent on moderators including firm age/size, industry, and institutional conditions (regulatory and market drivers). Key lenses are resource‐based view (RBV), dynamic capabilities view (DCV), institutional theory (IT), and stakeholder theory (ST). Quantitative (especially panel) studies dominate, with evidence concentrated in Europe and China and mainly in manufacturing. This global SLR offers a comprehensive, up‐to‐date synthesis of the EI–FP literature, advancing beyond narrative reviews or narrowly focused meta‐analyses. Its primary contribution lies in diagnosing the systematic reasons for the field's varied findings, thereby explaining why the EI–FP link is contingent. It systematically identifies critical research gaps that emerge from this analysis, most notably the need for a focused, methodologically robust investigation within the OECD context to resolve key inconsistencies observed in the global literature. The findings inform a conceptual framework and review‐derived hypotheses for future testing of the EI–FP relationship, including environmental performance outcomes, and provide actionable guidance for managers and policymakers in environmental management. Consistent with systematic review conventions, these hypotheses are review‐derived and are presented to operationalize a focused future research agenda; they are not empirically tested in this article.

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