Green Human Resource Management and Organisational Sustainability Performance: The Mediating Roles of Green Innovation Capability and Green Resilience

Abstract

Background: Green Human Resource Management (GHRM) has emerged as a fundamental driver of organisational sustainability. However, the specific pathways by which GHRM influences performance—particularly via the mediating roles of Green Innovation Capability (GIC) and Green Resilience (GR)—remain under-researched in the Nepalese banking sector.

Objective: This study investigates the impact of GHRM on Organisational Sustainability Performance (OSP) and evaluates the mediating effects of green innovation capability and green resilience among banking professionals in Nepal.

Methodology: A cross-sectional survey was conducted among 385 employees from seven top-performing commercial banks in Bagmati Province, Nepal. Data were collected via a structured questionnaire utilising 5-point Likert scales. The research employed path analysis to test the direct and indirect relationships within a dual mediation framework.

Results: The findings reveal that GHRM exerts a strong direct impact on OSP (β = 0.791, p < 0.001). Mediation analysis confirmed that both GIC (β_indirect = 0.217, p < 0.001) and GR (βindirect = 0.075, p = 0.014) serve as partial mediators in this relationship. Notably, green innovation capability was found to be a more potent mediator than green resilience in driving sustainability outcomes.

Conclusion: The study demonstrates that strategically implemented GHRM practices enhance organisational sustainability both directly and indirectly. By fostering innovation and resilience, GHRM creates a robust framework for long-term environmental and institutional stability.

Unique Contribution: This research provides empirical evidence supporting the dual mediation functions of GHRM in a developing economy. It extends the Resource-Based View (RBV) and Dynamic Capability frameworks by offering context-specific insights into eco-friendly HR practices within the South Asian financial sector.

Key Recommendation: Bank managers should integrate green HR practices with targeted investments in innovation and resilience. Prioritising these capabilities allows financial institutions to balance short-term operational costs with long-term organisational stability and environmental stewardship.