Translating the environmental orientation of firms into sustainable outcomes: the role of sustainable dynamic capability

Emerging social and environmental demands drive organisations to seek management capabilities to reach sustainability outcomes. Despite relative efforts, there is still a need for works that empirically address the main antecedents and outcomes of sustainable dynamic capabilities (SDC). Focusing on the case of Brazil, we examine the mediating effect of SDC between environmental orientation and firm performance related to green innovation, green competitive advantage and environmental adaptability and find that SDC significantly mediates the effect of environmental orientation on green innovation. However, mediation between environmental orientation and green competitive advantage only obtains partial support. SDC and environmental adaptability do not present significative correlation, opening new discussions about adaptability as a direct consequence of SDC. These results contribute to the design of green innovation and green competitive advantage strategies as positive drivers of sustainability outcomes.