**3. The interplay between GHRM and green competitive advantage: theoretical background**

According to the resource-based view (RBV), an organization can be described as a combination of human, physical and organizational resources. These resources are valuable and inimitable, and are the primary source of sustainable competitive advantage and sustained high performance [26]. Thus, In the light of RBV, the firm characterizes the resource capability as a vital tool for sustaining performance, subsequently picking up a competitive edge over the other [27].

Aykan [3] points out that the tendency of firms to use valuable and inimitable internal sources to gain competitive advantage further increases the strategic importance of human resources. From the resource-based perspective, human resources are important contributors to firms' competitive advantage because of their rarity, value, non-repetitiveness, and exclusiveness [14].

#### *Toward a Better Understanding of Green Human Resource Management's Impact on Green… DOI: http://dx.doi.org/10.5772/intechopen.105528*

In this regard, the RBV integrates human resources as sources of a firm's competitive advantage [13]. This theory lays out a rational link between human resources practices and the application of strategies that eventually enhance organizational outcomes, which aids to induce a competitive edge for the firm.

Kuo et al. [21] argue that many firms treat corporate environmental management as an unneeded and ineffective investment and even think that green policies are harming the development of the firm. However, pioneers in environmental management and green innovation will have a "first mover advantage or be recognized as an early adapter," which will provide them with higher green profits, a green image, and a competitive advantage over their competitors. Thus, the RBV suggests that a firm can derive a competitive advantage on the basis of its environmental strategy and its relationship with the natural environment [22].

Scholars believe that GHRM is a very effective tool for developing green human capital, and can deliver green sustainable performance and green competitive advantage [4, 6, 7, 18, 26, 28–39]. For instance, Aykan [3] affirms that companies have to develop and implement environment-oriented strategies to gain sustainable competitive advantage. Thus, the availability of staff with skills and knowledge about environmental protection, together with practices that encourage the setting up of environmental initiatives, are sources of competitive advantage in costs and differentiation among companies [40]. Thus, GHRM integrates environmental management into human resource management to help enterprises achieve green value and create a unique competitive advantage [41].

GHRM is a pre-condition for green management and a critical step for sustainable competitive advantage [3]. Thus, HRM department should manage talented workforces in accordance with the needs of the time to sustain a competitive edge as well as to encourage workers to become engaged in environmental behaviors [42]. In this regard, green initiatives increase the chances of better green management as it aligns employees' goals, capabilities, motivations, and perceptions with green management practices and systems [6]. Thus, companies adopting proactive or advanced environmental strategies, such as GHRM, will be able to gain and maintain a sustainable competitive advantage.

From the discussion above, researchers believe that GHRM is considered as one of the very prominent strategies that eventually determine the green competitiveness of the firm. According to Ojo et al. [33], HRM practices can be considered as a bundle of internal resources for creating unique, valuable, and inimitable employee capabilities through which the organization can sustain its competitive advantage.

In a concrete manner, GHRM utilizes human resources to enhance environmental performance, waste reduction, social responsibility, and competitive advantage via continuous learning and development and by embracing employees' green goals and strategies that are fully integrated with the goals and strategies of the organization [43]. Thus, GHRM has become crucial to improving environmental performance and maintaining a competitive edge [36].

From this perspective, GHRM practices in the form of green recruitment, green training, and green rewards can improve and support environmental performance and create a competitive advantage [39]. Consequently, GHRM practices are essential for achieving environmental performance and sustainable competitive advantage through aligning employee behavior with the organization's strategic objectives [29].

For instance, hiring skilled and creative people leads to a competitive advantage. Specifically, it provides companies with important opportunities in terms of growth, expansion into new business areas, and enhanced profitability levels [13]. Thus, by implementing green activities during the recruitment and selection process, firms can attract talented, hardworking, skillful employees, which further helps the firms to gain a competitive advantage through attracting talented green profiles.

In addition, providing environmental training and building employees' capacity may improve their skills, motivation, retention, and job-related outcomes, thus improving productivity and profitability [13]. Therefore, by introducing green activities, firms develop and retain green committed employees, and also attract environmentally aware profiles [26].

Overall, GHRM if implemented properly to realize the vision, mission, values, and strategies of environmental programs, will be a business value added to the competitive advantage [18]. Thus, we argue that GHRM constitutes a potential source of green competitive advantage because it provides firms with unique, conscious, engaged, and difficult to imitate workforce. Particularly, we argue that green knowledge, green commitment, and green play a mediating role between GHRM and green competitive advantage. The RBV framework provides a foundation to explain the importance of including environmental practices in HR policies to be competitive.

#### **3.1 Green knowledge**

Green or environmental knowledge refers to how much information people have about environmental problems and their ability to consider and assess their effect on culture and environment [44]. Fryxell and Lo [45] define environmental knowledge as a general knowledge of facts, concepts, and relationships about the natural environment and its major ecosystems. They also claimed that environmental knowledge involves what people know about the environment, the key relationships leading to environmental aspects or impacts, and the collective responsibilities necessary for sustainable development. In other words, green knowledge is considered as a range of information a person has on environmental degradation, necessary actions, and potential solutions.

Accordingly, matching employees' knowledge with the organization's policy will contribute to a long-term cooperative relationship between employees and the company [46]. Thus, when employees have skill, knowledge, and ability regarding the green initiatives or practices, they will be more inclined to perform the environmentoriented behaviors [32].

According to Raza and Khan [47], environmental knowledge is understanding concepts, ideas, facts, and relationships regarding the natural environment. Thus, green knowledge compels an individual to save the earth by adopting green strategies.

Accordingly, when employees are knowledgeable and well aware of the environmental issues, ecological degradation, the importance of eco-friendly practices, and perceived behavioral control, they are more likely to actually display pro-environmental behaviors [48]. However, when employees lack knowledge and awareness about the causes and effects of environmental degradation and do not consider nonimmediacy of ecological destruction as an issue to be addressed, they do not engage in positive actions. Thus, environmental knowledge is likely to have a particularly strong influence on actions or behaviors to protect the environment [45].

Saeed et al. [43] support this assertion by stating that employee knowledge is found to affect decision-making and intentions. Therefore, individuals usually do not make themselves part of situations about which their knowledge is limited. In other words, green knowledge is a significant prerequisite for behaving in an appropriate manner and would be a significant barrier to action if its levels were low. Thus, the mainstream

#### *Toward a Better Understanding of Green Human Resource Management's Impact on Green… DOI: http://dx.doi.org/10.5772/intechopen.105528*

literature on environmental knowledge has proven that green knowledge led to understanding and incentivizing individuals to behave or refrain them from behaving.

The interaction between environmental knowledge and GHRM may strengthen employees' willingness to cooperate with the organization, thus increasing the generation of employees' green behavior [46]. For instance, green training can help employees obtain environmental techniques and knowledge, which enables them to develop their careers in a better manner [49].

In this regard, we support that GHRMP can effectively increase employees' green knowledge through environmental training, green empowerment, green recruitment, and other practices. Overall, GHRM can play a vital role in enhancing employees' environmental knowledge. Thus, we developed the following hypothesis:

*H1. GHRM is positively related to green knowledge.*

Furthermore, Mtembu [31] claimed that embracing knowledge management is one of the main sources of competitive advantage. Thus, organizations must ensure that they harness a wealth of knowledge and wisdom and make sure that it is shared within the organization and used optimally for the benefit of the company and its stakeholders. Astuti and Datrini [50] support this point of view and affirms that the environmental knowledge embedded in individuals is of great importance for firms, especially in developing green innovation and green management. Thus, it could be a source of GCA.

As has been pointed out, knowledge is a very important aspect of individual environmental awareness. Thus, we argue that the company holding employees, who are environmental experts or have deep environmental knowledge will be likely a source of competitive advantage. Therefore, the following research hypothesis is proposed:

*H2. Green knowledge plays a mediating role between GHRM and green competitive advantage.*

#### **3.2 Green commitment**

Suharti and Sugiarto [51] define green commitment as a high level of responsibility in implementing the Green Business concept in the company. Moreover, Aboramadan [52] defines green commitment as the energy an employee puts into his green work-related tasks, the willingness to exert efforts at the green level, and the absorption level in green work.

Commitment can be seen as the level at which employees are connected to their work cognitively, emotionally, and physically [52]. In this study, we use the term green commitment to refer to the extent to which a company's employees are dedicated to the preservation of the natural environment and are willing to engage in environmentally friendly actions. Thus, engaging employees to address environmental concerns is one of the most significant challenges facing organizations, today and in the future, and this explains why an employee's green commitment is well researched and grounded in theory [40].

According to Iftikhar et al. [53], the organization's initiatives to introduce GHRM establish a groundwork that supports employees' environmental commitment and enables them to develop environmental-friendly activities. Thus, GHRM practices ensure that members of a firm's workforce have the abilities required to make decisions and take actions that are environmentally friendly, feel motivated to exert effort to achieve environmental performance goals, and have sufficient opportunities to contribute to the firm's environmental agenda [54].

Assuming that a firm's strategically aligned HRM system targets all employees in the organization, GHRM systems should be influential in shaping the green commitment of employees. The enhancement of commitment and participation mechanisms, through GHRM, allows voice options for employees to help them achieve environmental objectives [55]. Thus, several lines of argument support the positive relationship between the GHRM system and green commitment [9].

For instance, Saeed et al. [43] state that by incorporating environmental management objectives and targets within the performance evaluation system, providing regular feedback to employees about green achievement, providing environmental training and opportunities for employees to involve them in green suggestion schemes and joint consultations for environmental issues problem solving, organizations can increase employees concern and commitment toward protecting the environment. Furthermore, compensation practices related to environmental management are effective in engendering employee commitment [56]. In the same line, Kim et al. [57] state that companies implement environmental training and educational programs to focus on encouraging employees to take pride in belonging to the company and to increase their level of commitment.

Given the discussion above, we hypothesize that GHRM contributes to the employee's green commitment.

#### *H3. GHRM is positively related to green commitment.*

Harvey et al. [55] emphasized that GHRM policies and practices are tailored to achieve specific green ends, via the enhancement of job satisfaction, organizational commitment, and engagement more generally, this, in turn, increases the likelihood of employees supporting the environmental goals set by the firm. Therefore, green committed employees would be more inclined to work in an environmentally friendly way, which can have a positive impact on the firm's competitive advantage.

Consistent with the logic of RBV, employees' commitment to achieving environmental goals, strategy, and concerns of the organization, which we call green commitment, is not only valuable but also rare, imperfectly imitable, and not substitutable, which is likely to make the green committed workforce a source of competitive advantage. However, few studies have analyzed the relationship between GHRM practices that encourage employees's green commitment as a potential source of competitive advantage with a unique and difficult to imitate workforce. Following the essential role played by employees as co-creators and implementers of the company's green actions, we argue that their commitment could mediate between GHRM and green competitive advantage.

*H4. Employee green commitment mediates the impact of GHRM on green competitive advantage.*

#### **3.3 Green values**

Zoogah [58] defines green values as internalized social representations or moral beliefs, that people appeal to, as the ultimate rationale for their environmental actions. Therefore, aligned individual values with the organizational values are expected to result in optimal employee outcomes, such as strengthened organizational identification and positive work attitudes and behaviors [5].

For this reason, management must give importance to individual values in its recruitment process. This practice can help management to align organizational values with individual values [59]. In other words, the organization should consider

#### *Toward a Better Understanding of Green Human Resource Management's Impact on Green… DOI: http://dx.doi.org/10.5772/intechopen.105528*

individual green values and spread information about the organization's green programs during the recruitment and selection process.

Additionally, organizations should communicate green values to the hired employees in their training programs [59]. Thus, organizations need to provide green training and communicate their green policies and environmental values effectively to current and potential employees, so that employees will be able to develop individual green values that support corporate environmental goals. As stated by Paillé et al. [34], firms often utilize training and education programs to embed ecological practices and showcase their green values to update employees about initial change(s), new performance criteria, and staff competencies.

According to Ihsan et al. [60], GHRM with its agile efforts can built-in green values among members about ecofriendly conventions like an efficient use of electricity, lesser usage of carbon, and prioritizing the recyclable products procurement.

Extending this argument, Cheema [61] argues that if an individual perceives that his organization acts in an environmentally responsible manner, his values and beliefs about the environment would better match to organizational values. Thus, we propose that when the organization supplies a favorable environment to employees with GHRM practices, it would create alignment between individual green values and organizational values. As posited by Zhu et al. [46], if the company creates an environment that is conducive to employees' values, makes employees' green values consistent with those of the firm, and creates a strong sense of belonging to the organization, employees will be more likely to show green behavior in their work and their commitment will be reinforced.

In the light of the foregoing, we hypothesize the following:

*H5. GHRM is positively related to green values.*

Dumont et al. [5] claim that the stronger an individual connects with his organization through aligned values, the greater the likelihood that the employee would commit to achieving organizational goals and objectives. Thus, by absorbing green values from the GHRM practices, employees may become "environmental activists" inside the organization and influence other stakeholders to engage in pro-environmental behaviors. Thus, we believe that if an individual's values are based on beliefs about environmental restoration, it might strengthen organizational competitive advantage with a high-quality green workforce who is more aware and sensitive about the value of environmental protection.

**Figure 2.** *Research model.*

As highlighted by Chaudhary [62], implementing GHRM is likely to signal the environmental values, principles, and orientation of the organization, this commitment to the natural environment is likely to provide organizations with much-needed differentiation in a highly competitive marketplace. Thus, individuals having a greater degree of green values are likely to strengthen the association between GHRM and GCA. From the above discussion, the following hypothesis is advanced:

*H6. Green values mediate the impact of GHRM on green competitive advantage.* **Figure 2** presents the hypothesized research model.
