%0 Journal Article
%@ 20711050
%A Johl, S.K.
%A Toha, M.A.
%D 2021
%F scholars:14853
%I MDPI AG
%J Sustainability (Switzerland)
%N 11
%R 10.3390/su13116253
%T The nexus between proactive eco�innovation and firm financial performance: a circular economy perspective
%U https://khub.utp.edu.my/scholars/14853/
%V 13
%X Eco�innovation has gained considerable attention in the academic and corporate world due to its potential in mitigating a firm�s sustainability issues. Most previous studies focused on the reactive approaches of eco�innovation using primary data. This study mitigates the existing research gap by highlighting proactive eco�innovation and using a secondary panel dataset. The prime objective of this study is to investigate the relationship between proactive eco�innovation and firms� financial performance. Hence, the study will introduce the proactive eco�innovation index with the help of secondary panel data. In addition to that, the paper will also explore how proactive eco-innovation relates to circular economy. The theory of Resource�Based View (RBV) was used to ex-plain the relationship among the variables. This study was conducted on 31 Malaysian public listed energy companies from 2015 to 2019. A proactive eco�innovation index was inferred by adapting three dimensions of eco�innovation (product, process, and technology) which is applicable for the energy sector. By applying random�effects GLS regression equation modeling, it was found that proactive eco�innovation (product eco�innovation, process eco�innovation, and technology eco�in-novation) has a direct effect on firm financial performance. Furthermore, product and process eco-innovation is directly related to a circular economy through a sustainable product development process. The findings suggest that policymakers in the firm should proactively adopt eco�innovative practices. It will positively affect the circular economy as it will be cost�effective and help to reduce potential industrial pollution in the environment. © 2021 by the authors. Licensee MDPI, Basel, Switzerland.
%Z cited By 27