Modelling Sustainable Manufacturing Practices Effects on Sustainable Performance

Abstract

This study empirically investigates the effects of sustainable manufacturing practices on sustainable performance, focusing on the moderation effect of companies’ ownership (foreign or local) between sustainable manufacturing practices and sustainable performance. In this study, a survey was conducted among ISO 4001-certifed manufacturers in Malaysia, and structural equation modelling was used to examine the moderating effect of a company’s ownership on the relationship between sustainable manufacturing practices and sustainable performance. The findings showed that there was a positive relationship between both sustainable product design and sustainable manufacturing processes and sustainable performance for Malaysian manufacturers. However, the positive relationship between both sustainable product design and sustainable end-of-life practices on sustainable performance was stronger for foreign companies compared with that for local companies. The results showed the strengths of foreign-owned companies were at the implementation of their sustainable product design and sustainable end-of-life management practices of the product manufacturing process. The fndings identifed in this paper extend previous research and provide empirical evidence that a company’s ownership impacts the relationship between sustainable manufacturing practices and sustainable performance. Keywords Sustainable manufacturing practices · Sustainable performance · Structural equation modelling · Ownership