Abstract
Green purchasing has emerged as a sustainable strategy adopted by many companies. While various studies have investigated the relationship between green purchasing and both environmental and financial performance, the findings have been inconsistent. This study re-evaluates the relationship between green purchasing and financial outcomes by considering the moderating effects of internal integration and supplier development. We propose that the benefits of green purchasing may take longer to manifest in terms of financial performance. This study draws on data from 89 listed manufacturing firms in Taiwan that regularly disclosed Corporate Social Responsibility (CSR) or Environmental, Social, and Governance (ESG) reports from 2014 to 2022. This resulted in a panel dataset comprising 801 firm-year observations. Based on the EGG model estimated with STATA, our empirical findings demonstrate that the beneficial impact of green purchasing on financial performance materializes only after two years. Additionally, both internal integration and supplier development significantly enhance the positive effects of green purchasing on the performance outcome.