Going greener, performing better? The case of private family firms

In line with recent developments stressing the contextual sensitivity of the performance implications of sustainable development goals, this article explores the relationship between green innovation adoption and performance in private family firms. Drawing on the upper echelons theory, this research suggests that the influence of green innovation adoption on performance is contingent upon two important family-firm specific sources of top management team (TMT) diversity: family involvement and generational involvement. Using a sample of 191 private family firms, our results show that the positive impact of green innovation adoption on performance is attenuated as the ratio of family members involved in the TMT increases. In contrast, a higher number of generations involved in the TMT strengthens the positive relationship between green innovation adoption and performance. Our findings contribute to the scarce literature on sustainable development goals and green innovation in the family business context, stressing that the type of family involvement in the TMT conditions the ability of private family firms to turn green behaviors into performance gains.