Green Competitive Advantage in Indonesia's Chemical Manufacturing

Abstract

This study seeks to investigate the impact of integrating green competitive advantage as a mediating factor between core competencies and organizational performance, focusing on the chemical manufacturing sector in Indonesia. The sector has experienced a notable decline in productivity over the past five years, attributed to various factors including diminished competitive advantage, environmental concerns, social issues, and challenges related to human capital development due to skills gaps. Employing a structural equation model framework, this research examines the relationship between core competencies, measured through a comprehensive set of 24 indicators, and organizational performance, assessed by six key performance indicators. Additionally, the study evaluates the role of green competitive advantage, represented by four distinct indicators, as an intermediary mechanism influencing the association between core competencies and organizational performance. The findings of this investigation demonstrate a favorable model fit, indicating the suitability of the structural equation model for analyzing the relationships under consideration. Importantly, the results highlight the significant contribution of green competitive advantage as an intervening variable, enhancing the linkage between core competencies and organizational performance within the context of the chemical manufacturing sector in Indonesia.