When Does It Pay to Be Good? A Meta-Analysis of the Relationship Between Green Innovation and Financial Performance

A rapid increase in environmental concerns has prompted firms to engage in green innovation. However, previous studies have found contradictory results for the relationship between green innovation and financial performance, thus offering us an opportunity to revisit the relationship using a meta-analysis method. By analyzing a sample size of 20 503 observations from 80 studies, in this article, we find a positive relationship between green innovation and financial performance. Moreover, the relationship is stronger in fast-clockspeed and close-to-consumer industries than in others and stronger in countries with a strong control of corruption and a long-term cultural orientation than in others. This article advances the understanding of the green innovation–financial performance relationship as well as of the role of research context as a moderator of that relationship.