Role of Green Organisational Culture in the relationship between Adaptive Capabilities and Competitive Advantage: A study of Commercial Banks in Kenya

Abstract

Adaptive capabilities are theorised to be associated with competitive advantage contingent on organisational culture. Within Kenya’s commercial banking sector, marked by an evolving green regulatory landscape, Green Organisational Culture (GOC) may strengthen or weaken the association of Adaptive Capabilities (AC) on Competitive Advantage (CA), an area which is underexplored. This study examined GOC’s moderating and mediating role in this relationship, guided by Dynamic Capabilities Theory and Organisational Culture Framework. A positivist, explanatory, cross-sectional quantitative research design covering commercial banks in Kenya. 205 primary data points using structured questionnaires from senior management were used in analysis. PLS-SEM results confirmed significant direct association of AC and CA and on GOC, as well as significant direct association of GOC and CA. The interaction of GOC with AC was insignificant, while the indirect role of AC on CA via GOC was statistically significant, confirming the mediating role of GOC.  So, GOC relates with the competitive advantage indirectly, through adaptive capabilities rather than through direct moderation. The study recommends integrating GOCs into strategic frameworks, technology uptakes, and practices. The study contributes to the empirical extension of theory in an understudied geographical and sectoral context. The results signal in favour of policy development on GOCs.