Green Supply Chain Management, Business Performance, and Future Challenges: Evidence from Emerging Industrial Sector

Abstract

This research explores the relationships between green supply chain management (GSCM), lean management (LM), corporate social responsibility (CSR), and business performance (BP) in the industrial sector of Saudi Arabia. The project is implemented within the Vision 2030 framework, which aspires to green the Saudi economy by transitioning it from reliance on hydrocarbons to a diversified, sustainable economy. A quantitative approach was implemented, which involved the application of the structural equation modeling analysis for the survey data from 345 managers in the industrial sector in Saudi Arabia’s Eastern Region. The results revealed that GSCM directly makes a significant contribution to LM, CSR, and BP. Also, the study found that LM was the positive factor that mediated the relationship between GSCM and BP. Nevertheless, no such associations were found between CSR and BP, nor was there an indirect effect of CSR as the mediator variable. The research underscores the supreme role lean management plays in translating environmentally friendly supply chain practices into better business performance. It reveals that industrial companies wishing to gain the advantages of narrowing their supply chain by using green practices should also simultaneously implement a lean management system to improve efficiency.

1. Introduction

Saudi Arabia’s Vision 2030 is a comprehensive plan designed to transform the nation into a leading global economy through economic diversification, decreased reliance on oil revenues, and the promotion of sustainable growth in multiple industries. Saudi Arabia’s industrial sector is anticipated to drive a profound revolution in the country’s supply chain, leading to a stronger and more competitive nation. By embracing transformative changes, Saudi Arabia is set to revolutionize its supply chain, paving the way for a new era of growth and development. This shift will bring about increased efficiency, innovation, and sustainability, positioning the country as a strong global competitor in the supply chain industry by 2030 [1]. According to [2], the industrial sector in emerging economies, such as Saudi Arabia, must be proactive in managing potential risks associated with the implementation of green supply chain management (GSCM) practices. The authors emphasize that this is crucial due to the ever-changing nature of the sector, which necessitates the identification, evaluation, and prioritization of various risk factors to ensure the successful integration of GSCM. The recognition of GSCM’s importance for sustainable growth and the preservation of social and environmental values by companies and organizations in these regions further emphasizes the need for a proactive approach [3,4].

GSCM is an innovative approach that seeks to improve the environmental sustainability of operations and goods, aligning with the requirements set by environmental legislation [5]. It involves organizations reassessing their supply chains to address global environmental challenges such as climate change, greenhouse emissions, and the growing demand for eco-friendly products [6]. In an effort to promote sustainability, many companies have adopted greener supply chain practices. They include conducting environmental audits, implementing certification programs, providing support to suppliers for environmental initiatives, and encouraging collaboration in environmental efforts [7]. Recently, environmental regulations have been set in line with global standard to reduce the impacts of environmental pollution [8]. The growing interest in environ-mental sustainability has resulted in an increasing number of studies focusing on the integration of green practices in supply chain management [9]. Governments and organizations worldwide are actively working towards minimizing their environmental footprint by incorporating eco-friendly materials, implementing sustainable production processes, and adopting effective post-consumer waste management strategies [10]. According to [11,12], many companies have embraced green supply chain practices to achieve positive environmental outcomes, reduce costs, and improve quality. GSCM is considered an important success factor in firms’ growth and development [13]. Ref. [14] also noted that firms have adopted green supply chain management practices to achieve environmentally sustainable products and services, as well as to com-ply with environmental regulations imposed by governments. In response to the growing concerns about the environment, businesses are likely to be required to adopt a green-er approach in their interactions with customers and suppliers. This will involve taking steps to minimize the ecological footprint of their offerings and operations [15]. In the context of the Saudi industry, effective management of the supply chain will play a crucial role in unlocking the full potential of the Saudi Arabian market. By ensuring a smooth flow of materials and equipment from suppliers, businesses can meet the growing demand for their services both domestically and globally.

The introduction of green initiatives and sustainability has shifted the perception of the world from a mere commodity approach to a more conscious and responsible approach [16]. Human and business negligence and unethical practices have contributed to the worsening environmental problems witnessed in recent decades [17]. By adopting green business techniques, such as green supply chain management, firms have the potential to enhance their performance and contribute to a more sustainable future [18]. In recent years, businesses have become increasingly interested in adopting environmentally green practices to address environmental challenges and improve their overall performance [16,19]. These green approaches have proven to be beneficial for supply chain operations, company operations, and overall efficiency, which lead to enhanced competitiveness and sustainable business performance (BP) [20,21].

The resource-based view (RBV) theory is often used to demonstrate the impact of GSCM practices on BP [12,22]. The RBV states that industries need to enhance their resources and capabilities, and effectively utilize them to achieve long-term competitiveness [23]. RBV theory de-scribes a deliberate asset as a resource that possesses the qualities of rarity, im-portance, and difficulty to replicate or substitute [24]. By strategically integrating these assets in innovative ways, businesses can elevate their competitive advantage and attain above-average returns [25]. The theory suggests that the adoption of GSCM practices can play a crucial role in influencing a company’s overall BP [22]. Various scholars have enhanced the concept of the RBV to highlight the importance of green initiatives as a valuable strategic resource, which ultimately results in enhanced BP [26,27].

A business’s capacity reflects its commitment to implementing more green practices in supply chain management, including reducing resource consumption, optimizing energy and water usage, and implementing eco-friendly solutions [28]. Ideally, the primary objective of successful businesses is to integrate “lean” and “green” approaches to manage and minimize waste and scrap generated during routine operations, which lead to substantial cost savings in supply chain management through the identification and reduction of resource usage and production waste [29,30]. Lean management (LM) is a systematic approach aimed at reducing costs and minimizing waste in industrial companies [31]. It is a business strategy that enhances customer satisfaction and improves overall BP. According to [32], the simultaneous implementation of green and lean principles has a greater impact on pollution control and operational performance compared to implementing them separately. By adopting both approaches concurrently, organizations can effectively address issues and overcome restrictions in their practices. Among the difficulties facing businesses implementing lean initiatives is determining which practices can be implemented throughout the entire supply chain, from supplier orders to customer delivery, to streamline processes and prioritize the customer’s perspective. Therefore, LM can be implemented at both the internal and external levels, which involves the focal firm, suppliers, and custom-ers. At the external level, LM focuses on the interconnectedness of these entities and the application of lean principles throughout the supply chain [33].

Furthermore, the process of greening the supply chain encompasses incorporating green practices throughout the manufacturing process while considering both internal corporate social responsibility (CSR) and external stakeholders. This entails involving suppliers in addressing environmental issues, utilizing eco-friendly materials, minimizing waste, enhancing packaging, and establishing initiatives for product recovery [34]. CSR encompasses a range of efficient and integrated strategies, which aimed at reducing or eliminating waste generated throughout the entire lifecycle of products and mate-rials [35]. Previous research indicates that incorporating CSR initiatives has several positive effects, such as strengthening a company’s sustainability and accountability [36], improving stakeholder perceptions of the brand and reputation [37], and in-creasing customer satisfaction [38].

In general, organizations have struggled to justify the incorporation of GSCM due to the lack of clear evidence linking its implementation with improved performance, whether in terms of finances, the environment, or operations [39]. Given the conflicting findings from various studies, it is necessary to explore the potential advancements that GSCM can offer in the understanding of its effects on firm performance. The findings on the relationship between GSCM practices and the firms’ performance are in-conclusive. Furthermore, the study by [40] highlights the limited research conducted on the relationship between GSCM and performance in developing countries. Additionally, GSCM is still relatively unfamiliar in developing nations [41]. Moreover, in a study conducted on Jordanian manufacturing companies by [42], it was found that there was no substantial correlation between GSCM and BP. These factors serve as the driving force behind the current research, which aims to gain a deeper understanding of the correlation between GSCM and performance. In addition, attention to GSCM has been substantially increased due to COVID-19.

In light of the gaps observed in the existing literature, this paper contributes to literature and research on two fronts. Firstly, it examines the relationship between GSCM and BP. Secondly, it reveals the mediating role of LM and CSR in the relationship between GSCM and BP in the context of the industrial sector in Saudi Arabia. In addition, this paper also makes a remarkable contribution to the Saudi industrial sector, offering guidance on how to enhance BP by implementing the most effective GSCM approach with the mediating factors of LM and CSR. Furthermore, this research represents one of the initial investigations into the relationship between GSCM and performance in emerging markets, particularly within the industrial sector of Saudi Arabia. Given the lack of a defined mediating role in existing literature, it is imperative to reexamine and redefine the rational comprehension of the connection between GSCM and BP, as well as between LM and CSR.

This study aims to enhance the understanding of GSCM performance from a managerial perspective by addressing the following research questions (RQ):

• RQ1. What is the relationship between Green Supply Chain Management (GSCM) and Business Performance (BP)?
• RQ2. How do Lean Management (LM) and Corporate Social Responsibility (CSR) mediate the relationship between Green Supply Chain Management (GSCM) and Business Performance (BP)?

To provide a clear structure, this paper is organized as follows: Section 2 contains a literature review, Section 3 contains the theoretical framework and hypotheses development, Section 4 presents the study’s methodology, Section 5 presents the study analysis and results, and Section 6 presents a discussion of the results and their implications.

2. Review of Literature

2.1. Green Supply Chain Management

Businesses worldwide are acknowledging the significance of viewing environ-mental management programs and operations as continuous efforts that extend be-yond their organizational boundaries [10]. However, past efforts to enhance effectiveness were adversely affected by energy inefficiencies and environmental issues [43]. Therefore, the implementation of GSCM as a viable solution for environmental improvement has gained traction among both scholars and professionals. While the concept was first introduced in the early 1990s, it gained significant recognition and interest around the year 2000, as evidenced by a noticeable rise in scientific publications on the topic [44,45]. GSCM refers to the incorporation of environmental considerations throughout the entire supply chain, encompassing aspects such as product design, material procurement, manufacturing procedures, product delivery, and post-use product management [46]. According to [47], GSCM encompasses eco-initiatives that span the entire product life cycle, including design, production, distribution, customer use, and disposal. Ref. [48] suggested that GSCM involves integrating eco-friendly principles into every aspect of the supply chain, from material sourcing and product design to transportation, manufacturing, storage, packaging, recycling, and proper disposal at the end of a product’s life cycle. While variations exist in the definitions, several shared terms are evident, as identified by [49]. These include ‘supply chain environmental management’ [50], ‘green purchasing and procurement’ [51], ‘green logistics and environmental logistics’ [52], and ‘sustainable supply net-work management’ [53].

In light of this, GSCM includes various aspects such as designing environmentally friendly products, managing the environment, ensuring high quality, using eco-friendly packaging and procurement methods, implementing green distribution practices, and taking initiatives for the end-of-life of products [54]. Several research studies have shown that GSCM is an emerging and highly important trend in the business environment. Ref. [55] presented a comprehensive framework for a green supply chain, illustrating how GSCM practices cover various aspects such as sourcing raw materials, incorporating sustainable practices in product development, and effectively managing pollution from distribution to disposal and recycling. The categorization of GSCM practices by [56] encompasses a range of areas, such as distribution strategies, transportation, warehousing and green building, reverse logistics, cooperation with customers (CWC), investment recovery, eco-design and packaging, and internal management. According to [57], there are several practices within GSCM, such as managing internal environmental factors, implementing green purchasing, collabo-rating with customers, incorporating eco-design, and ensuring investment recovery. Ref. [58] provided a classification of GSCM practices, including eco-design, environ-mental cooperation, reverse logistics, and GP. Similarly, Ref. [7] categorized GSCM practices as clean production, GP, patents, internal service quality, eco-design, and green innovation.

In the current study, we have implemented practices that have received extensive attention and discussion in the existing literature, specifically, eco-design, green purchasing (GP), and internal environmental management (IEM) [10,12,15,40,42,57]. These practices can be divided into two main categories: those that address the internal aspects of the organization, such as eco-design and internal environmental management, and those that relate to the external environment, such as green purchasing. These practices are crucial strategies that can effectively reduce the environmental impact of an organization’s supply chain operations [59]. In addition, they exert significant impact on essential organizational facets such as corporate reputation, competitive edge, and marketing presence [60].

ECD is an environmentally conscious approach, which involves collaboration both within and outside of the organization to implement sustainable practices along the entire supply chain [61]. By incorporating ecological factors into both product design and production processes, companies can enhance their environmental performance and effectively respond to the expectations of various stakeholders [62]. ECD can be defined as the organized examination of design concerns related to the environment, safety, and health throughout the entire life cycle of a product, encompassing its creation and the development of associated processes [63]. The objectives of ECD encompass the development of products that can be easily taken apart and recycled, minimize resource usage, and minimize or eliminate the utilization of dangerous or toxic materials [64]. The firm can achieve these objectives by integrating its extensive capabilities in eco-product development, green manufacturing, process enhancement, and life cycle assessment through effective collaboration across multiple departments [22].

Following the definitions and discussion provided above, the ECD construct in the current study encompasses indicators pertaining to the development of products with minimal resource consumption (Material/Energy), the ability to be reused and recycled, a reduction in hazardous materials, and a decrease in air emissions.

GP is a purchasing strategy that seeks to integrate a company’s environmental objectives by promoting waste reduction, recycling, and the adoption of sustainable alternatives in the sourcing and utilization of products and materials [65]. GP also focuses on being environmentally responsible and aims to preserve natural resources, maintain ecosystem quality, prevent pollution, reduce energy, water consumption, and minimize waste disposal [42]. Thus, by fostering collaboration between the purchasing company and its suppliers, this approach encourages the use of sustainable materials and components, while also incentivizing waste reduction, recycling, and energy efficiency measures [22]. This practice is crucial because it allows firms to take control of their suppliers’ eco-performance, starting from the initial stages of material flow, resulting in purchasing becoming a key player in the process of making materials and in activities that are more environmentally friendly [66]. Following the definitions and discussion provided above, the GP construct in the current study encompasses elements related to collaborating with suppliers to achieve environmental goals, sourcing eco-friendly materials, partnering with certified environmentally conscious suppliers, and assessing and selecting suppliers based on predetermined environmental standards.

IEM is defined as the strategic integration of environmental sustainability within an organization, supported and embraced by managers at various levels of seniority [15]. It is considered as a critical component of GSCM [22]. It can be described as a structured approach that includes a series of environmental policies, internal policies, evaluations of environmental effects, measurable environmental objectives, action plans, roles and responsibilities, and regular audits to ensure compliance [40,67]. Thus, IEM implementation necessitates a well-organized system of monitoring and auditing [67]. The indicators used in this study to measure the IEM construct align with the criteria. These indicators encompass elements such as management commitment to GSCM, collaboration between different departments for environmental initiatives, implementation of environmental auditing programs, and adherence to environmental regulations.

2.2. Business Performance (BP)

A business philosophy guides an organization in identifying its target markets, comprehending their demands, and aligning its business functions to effectively meet the needs of and provide added value to those target markets [68]. Business performance is a multifaceted concept encompassing effectiveness, efficiency, and the ability to adapt to changing circumstances [69]. The performance of a business, as defined by [6], serves as a benchmark for stakeholders when making decisions. It can be evaluated by considering both the financial and non-financial aspects of the company [70]. There are various indicators to evaluate business performance. Ref. [71] utilized a combi-nation of subjective and indirect metrics to assess business performance, encompassing both financial indicators (such as total sales and sales growth rate) and non-financial indicators (such as market share and stock age). Similarly, other studies have also recognized profitability, market share increase, sales growth rate, efficiency, effectiveness, and customer satisfaction as essential measures of business performance [42,72].

The indicators utilized in this study to measure financial performance are in line with the existing literature [73,74,75]. These indicators cover aspects such as outperforming competitors in terms of profitability, return on investment, and achieving financial goals. Market performance covers aspects such as outperforming competitors in terms of sales revenue growth, acquiring new customers, expanding market share, and increasing sales to existing customers [76,77,78]. These indicators were specifically selected because of their common use among researchers and their importance in subjective evaluations made by senior management in evaluating their company’s performance.

2.3. Lean Management (LM)

LM is a set of strategies organizations employ to maximize efficiency and minimize waste by delivering precisely what customers require with minimal resources, including time, equipment, and space [79]. Ref. [80] defined LM as a philosophy that seeks to minimize waste and optimize efficiency in product development, ensuring that products are tailored to meet customer needs while minimizing resource utilization, costs, and time investment. LM allows for the efficient and cost-effective production of large quantities of high-quality products [81]. In addition, LM strives to identify and eliminate inefficiencies throughout the entire value stream of a product, spanning both the organization and the supply chain network, leading to enhanced productivity and cost reduction [82]. LM aims to enhance productivity and effectiveness by eliminating activities that do not contribute value [83]. This leads to the reduction or elimination of various forms of waste, including overproduction, waiting time, transportation, inefficient processes, excessive inventory, unnecessary movement, and defects [84]. Additionally, it involves the development of performance metrics to gain a competitive edge over rival companies [85]. LM incorporates a variety of methodologies and practices, including value stream mapping, 5S, Kaizen, just-in-time, TQM, cellular manufacturing, SMED, standardized work, TPM, six sigma, poka-yoke, and Kanban [86,87]. These tools or techniques are specifically created with the aim of minimizing waste, enhancing process effectiveness, boosting customer satisfaction, and maximizing productivity [88].

In this study, we have integrated well-known and extensively studied practices that have garnered substantial focus in the existing literature, specifically, Total Quality Management (TQM), Just-in-Time (JIT), and Total Productive Maintenance (TPM). The different components of the LM integration framework cover specific aspects that contribute to improving efforts aimed at advancing products, processes, and equipment.

2.3.1. Total Quality Management

TQM is a manufacturing initiative that focuses on consistently enhancing and maintaining the quality of products and processes through the active participation of management, employees, suppliers, and customers, with the goal of surpassing customer expectations [89,90]. As [89] note, TQM is a management philosophy that emphasizes customer orientation, ongoing improvement, and collaboration among team members. The authors emphasize that it encompasses a set of principles, practices, and techniques that guide organizations in achieving high-quality products and ser-vices. It encompasses the entire organization, requiring the involvement and coordination of all departments, units, and individuals at various levels [91]. By implementing TQM, organizations can enhance the quality of products or services provided to customers, thereby boosting productivity and reducing costs [92]. Both the manufacturing and service sectors can effectively incorporate TQM into their operations. Many research studies highlight TQM as a means of gaining a competitive edge and improving overall performance [93,94]. Companies that adopt TQM practices tend to outperform those that do not in terms of gaining a competitive advantage [95]. TQM encompasses both soft and hard dimensions [96]. Soft TQM focuses on the management of relationships and people, while hard TQM emphasizes the application of technical techniques and tools in quality management [97]. The TQM framework used in this study incorporates elements of hard TQM, which encompass continuous improvement, effective process management, and the implementation of statistical process control (SPC) techniques.

2.3.2. Just in Time (JIT)

JIT aims to eliminate waste and improve efficiency by involving the workforce in JIT production [21]. According to [98], it is crucial to ensure that every event and process is executed correctly, with the appropriate form, necessity, and timing, to achieve optimal production of goods. The principles of the JIT philosophy encompass three key elements: ensuring high quality standards, fostering active employee participation, and implementing efficient JIT manufacturing methods [99]. Certain practices with-in the JIT framework focus on optimizing production processes and are referred to as JIT production or Internal JIT by various researchers [100]. The most used JIT production practices include minimizing set-up time, using small lot sizes, adhering to daily schedules, implementing kanban-based pull systems, organizing U-shaped cell lay-outs, and utilizing heijunka boxes [101]. As the adoption of JIT production increased, researchers started recognizing its applicability in various areas, including purchasing and inbound logistics [102,103]. Supplier JIT deliveries [104] or JIT supply [105,106] These areas encompass practices such as vendor-kanban for procuring raw materials and outsourced components, as well as implementing pull systems for managing in-bound logistics.

In this study, JIT is measured through JIT material delivery, inventory management and supplier involvement. The premise of this choice revolves around the idea of reducing waste by streamlining manufacturing operations, including minimizing excess inventories and large batch sizes, which result in prolonged customer cycle times [107].

2.3.3. Total Productive Maintenance (TPM)

There are many challenges facing manufacturing companies around the world, which prevent them from achieving operational excellence. One crucial aspect of efficient operations is the implementation of TPM, which is considered a key practice in driving success in manufacturing [108]. The significance of proper equipment maintenance has been highlighted due to its ability to enable organizations to fulfill customer demands for low-cost, high-quality products delivered quickly [109,110]. Additionally, the effectiveness of an organization’s maintenance management system directly impacts its ability to generate increased revenue and reduce overall costs [111]. TPM is a comprehensive approach to preventive maintenance that involves all departments and levels of an organization, with the goal of maximizing equipment effectiveness. TPM engages all levels of employees to address root problems, achieve minimal defects, and ensure zero breakdowns, making it a collective organizational responsibility [112]. The authors emphasize the significance of operators and technicians in maintenance, highlighting their crucial role and emphasizing the importance of a competent workforce in ensuring effective maintenance practices. According to [113], continuous training and development are crucial for maintaining competence, which includes a combination of skills and knowledge. Preventive maintenance offers a proactive approach to machinery and equipment upkeep, aiming to prevent breakdowns and the associated disadvantages of unplanned stoppages, costly spare parts, and unpredictable repair durations [112]. However, computerized maintenance management systems streamline spare parts inventory management and scheduling repairs, while TPM minimizes equipment failures and allows operators to implement automated maintenance procedures in their daily operations [114].

In this study, TPM is measured through the presence of a fundamental maintenance system, ensuring regular equipment checks, employee training for daily maintenance and calibration, and immediate replacement of defective equipment parts [115,116,117].

2.4. Corporate Social Responsibility (CSR)

According to [118], CSR encompasses organizational efforts that consider the so-cial, environmental, and economic expectations of stakeholders. CSR encompasses a wide range of activities, including economic, charitable, legal, and ethical initiatives undertaken by an organization [119]. By engaging in these activities, the organization effectively communicates its commitment to social responsibility, thereby enhancing awareness and satisfaction among various stakeholders [120,121]. Yet, the definition of CSR remains ambiguous in the existing literature as its understanding and application may vary among individuals and organizations [122]. CSR is subjective and can be interpreted differently based on geographical location, societal norms, and cultural context [123]. Furthermore, when stakeholders view a business positively, it attracts other potential stakeholders to align themselves with the organization [124]. CSR pro-vides a competitive edge [125] for large companies [126]. It serves as a strategic tool for challengers to outperform market leaders by achieving favorable attitudinal and behavioral outcomes [125]. In this study, we have incorporated widely recognized and extensively examined methodologies, which have received significant attention in the existing literature, in particular, social dimensions and stakeholder dimensions. The premise is that CSR entails businesses aligning their policies, decisions, and actions with the goals and values of society [127].

2.4.1. Social Dimensions

The social dimension is characterized by the interconnectedness of business organizations and society’s needs, requiring a collaborative approach to address societal issues and achieve a common ground [26]. Businesses that place importance on social and environmental issues often establish partnerships with similar businesses [128]. This collaboration not only enhances their image but also encourages networking, which enables the sharing of ideas and the collective accomplishment of goals [129]. To fully fulfill its social dimensions, a business must encompass all aspects of its performance, including its economic, legal, ethical, and discretionary responsibilities towards society [119]. According to [26], business organizations strive to be socially responsible by addressing the needs of society, ensuring employee well-being and safety, promoting cooperation and involvement in decision-making, and integrating themselves into the community.

2.4.2. Stakeholder Dimension

Likewise, CSR attracts the attention and concern of a diverse range of stakeholders, including employees, shareholders, financial partners, consumers, suppliers, society, government, and the environment. Undoubtedly, each firm has its unique set of stakeholders with varying requirements and distinct interactions with them [130]. The dynamics of these interactions hinge on the firm’s actions and their impact on both the stakeholders and the firm itself [131]. However, stakeholders are interested in CSR communication, which is a voluntary practice that allows corporations to share information through various communication channels such as CSR sustainability re-ports and corporate websites [132]. This is because embracing CSR not only meets the expectations of stakeholders but also enhances corporate reputation [133]. Corporate environmental responsibility encompasses a range of activities such as pollution prevention, water conservation, recycling, and the management of by-products [134]. Previous studies in developing nations have shown how CSR initiatives have effectively addressed issues such as human rights, child labor, unemployment, and environmental emissions [135]. Thus, it is now crucial to establish institutional frame-works and systems that prioritize poverty reduction, social equity, societal well-being, and environmental protection [136].

Following the existing literature, this study measures the social dimension and stakeholder dimension by evaluating how a corporation incorporates stakeholders’ interests, responds to societal needs, uses transparent communication about social responsibility, and invests in technology for quality improvement and emission reduction.

2.5. Theoretical Framework and Hypotheses Development

Following the discussion of the theoretical background and related literature on green supply chain management, lean management, corporate social responsibility, and business performance, this study proposes an integrated model using green supply chain management as independent constructs, which are predicted to influence business performance (dependent construct) through the mediator variables of lean management and corporate social responsibility (Figure 1).

2.5.1. GSCM and BP

The level of adoption of GSCM practices plays a crucial role in determining the success of firms’ performances. Numerous studies have also observed favorable out-comes of implementing GSCM practices on business performance [39,48,137]. By implementing GSCM strategies such as evaluating product environmental impact during the design stage and conducting environmental audits, companies can streamline their operations, optimize resource utilization, and ultimately enhance overall business outcomes [138]. Collaborating with suppliers and customers in an eco-friendly manner provides a mutually beneficial strategy for achieving competitive advantages that can positively impact business performance [139,140]. Numerous studies have shown that implementing GSCM practices may result in higher investments, subsequently leading to increased operational expenses and potentially negative effects on overall business performance [141,142]. Nevertheless, while the negative consequences may be apparent in the short run, the long-term benefits, including reduced energy consumption, minimized waste production, and enhanced operational effectiveness, can outweigh the initial investments [42]. Long-term profits have the potential to enhance the reputation of a company, boost its financial gains, and improve overall business efficacy [138,143].

H1. 

GSCM has a direct positive impact on BP.

2.5.2. GSCM and LM

Several researchers have explored different elements of lean and green principles in the context of supply chain management. Ref. [144] explore the relationship between lean and green principles in supply chain management. They examine the ways in which these practices affect various aspects of the supply chain, such as capacity sur-plus, integration level, and lead time. Ref. [145] explore the intersection of green, lean, and global supply chain strategies. They discovered that the integration of lean processes with environmental practices is influenced by both internal and external factors. However, despite the potential synergies and benefits, firms encounter obstacles such as the time and financial commitments required to implement eco-friendly technology. While the utilization of eco-friendly resources and the implementation of lean manufacturing practices can have positive effects on the environment, it is important to acknowledge that some lean practices can also have detrimental environmental impacts [146]. According to [147], lean practices not only enable but also synergistically support green initiatives. Ref. [144] further emphasized this connection, describing the combination of lean and green as a synergistic blend of operational and environ-mental management. Similarly, Ref. [148] discovered positive evidence indicating that implementing lean principles leads to improved environmental outcomes through the reduction of operational waste. In addition, other realized outcomes, such as green purchasing behavior, are influenced by environmental practice [149].

H2. 

GSCM has a positive impact on LM.

2.5.3. GSCM and CSR

Implementing GSCM practices enables businesses to minimize resource wastage and enhance ecological efficiency in their supply chain operations [150]. Similarly, CSR initiatives foster a favorable employee mindset toward the organization, motivating them to streamline business processes for optimal outcomes [151]. Also, CSR encompasses initiatives and strategies that prioritize the well-being and development of employees within an organization [152]. Therefore, employees’ contributions can play a pivotal role in the effective adoption of GSCM strategies [19]. On the other hand, integrating CSR into the corporate culture [153] fosters a positive work environment that encourages innovation, cost-saving measures, energy conservation, emission reduction, and enhanced operational efficiency [154]. Ref. [155] emphasized the importance of incorporating GSCM practices into CSR strategies, which helps minimize the pressure faced by both internal and external stakeholders. Internal CSR encourages employees to adopt a positive attitude towards the organization and optimize business processes [38], while external CSR enables enterprises to create value for the environment and society, resulting in strategic decision-making that considers both parties’ interests [156].

H3. 

GSCM has a positive impact on CSR.

2.5.4. LM and BP

Several research studies have explored the impact of lean management on performance [80,157,158]. Lean practices have been shown to result in substantial cost savings, increased staff productivity, and improved quality [159]. Additionally, scholars have proposed a strong correlation between lean management and overall business performance [160,161]. However, some studies were unable to find any significant correlations between the implementation of lean practices and the overall performance of a business [162,163]. Nevertheless, the implementation of lean manufacturing principles enhances manufacturing efficiency by minimizing the time required for equipment setup and the amount of inventory in progress, resulting in faster production cycles and ultimately boosting overall market competitiveness [164]. Although implementing TQM and TPM individually has been proven to improve business performance, studies suggest that combining the two does not offer any additional benefits [165]. However, when JIT and TQM are implemented together with lean practices related to human resources [100], they have shown to enhance financial performance, customer service levels, and profit margins by improving organizational processes, cost efficiencies, and customer responsiveness [166,167,168], and labor and asset productivity [169,170]. In addition, implementing lean management can directly enhance business performance through its ability to address waste and inflexibility, optimize production efficiency, streamline processes, and lower production expenses [171,172,173,174].

H4. 

LM has a positive impact on BP.

2.5.5. CSR and BP

The impact of CSR activities on firm performance has been the subject of numerous studies, which have used different methods and reached varying findings. While some research shows a positive link between CSR and business performance, others find a negative association, and some scholars advocate for a neutral position. Studies conducted by [175,176] have highlighted a correlation between CSR and BP. Similarly, research by [177] supports the notion of a positive association between CSR and BP. In contrast, Ref. [178] suggest that these initiatives may have a negative effect, while others, like [179], argue that there is no significant relationship between CSR and BP. Ref. [180] also propose that the costs associated with CSR outweigh the economic benefits, ultimately leading to reduced profits and diminished shareholder wealth. These findings suggest that allocating organizational resources to CSR activities can negatively impact BP. According to [178], companies prioritize maximizing profits for shareholders rather than benefiting society. Therefore, they argue that firms are not obligated to allocate idle funds toward societal development. The authors also assert that engaging in CSR initiatives can weaken a company’s financial position. Despite this, several studies [181,182,183,184] indicate a positive association between CSR and BP. According to [185], CSR significantly influences consumers’ perceptions of brands and products, surpassing economic and rational factors. Moreover, Ref. [186] found that CSR initiatives also contribute to attracting highly skilled and dedicated employees.

H5. 

CSR has a positive impact on BP.

2.5.6. LM Mediates the Relationship Between GSCM and BP

According to previous studies [80,167,187], the documented performance effects of LM show variations. Ref. [86] suggested that these variations could be attributed to managers adopting different components of lean production separately. Similarly, Ref. [167] found that the combined effects of all LM practices are linked to improved manufacturing performance. According to [188], previous studies on the relationship between LM and performance have yielded inconsistent findings, possibly because they did not consider non-financial measures of manufacturing performance. However, prior research has indicated that LM has the potential to enhance financial performance by enhancing organizational processes and cost effectiveness [161,188]. In the lean context, waste is defined as anything that exceeds the necessary amount of equipment, materials, parts, resources, and time, all of which are crucial factors in adding value to the product [189,190]. Waste can manifest in various forms, including transportation, inventory, motion, waiting, over-processing, and overproduction [30]. In addition, lean practices have been widely adopted by various industries as a means to enhance productivity and gain a competitive edge [191]. Ref. [192] argue that embracing sustainability as the next phase of lean management can effectively reduce waste in the GSCM and enhance global social conditions. By implementing lean practices in various industries and throughout the supply chain, organizations can achieve efficient distribution and delivery, resulting in improved quality and customer service [193]. Based on the findings of [194], LM implementation has been found to enhance financial and marketing performance by reducing waste. Numerous studies have provided evidence that waste reduction, including decreased emissions and waste prevention, can result in financial benefits [195]. Waste reduction and prevention also have a positive impact on environmental performance, which in turn improves a company’s brand image and market performance [196]. Additionally, waste prevention can lead to better marketing performance through increased customer satisfaction and enhanced company image [197]. In the context of GSCM, despite their differences in drivers, tools, and practices, these two paradigms work in conjunction to enhance various aspects of the supply chain, making them commonly used as complementary approaches. At the internal level of a company, lean management can be implemented to improve process performance, product quality, and material flow optimization through tools like Just-in-time (JIT) or Pull flow, Quality Management Systems (QMS), Total Productive Maintenance (TPM), and Value Stream Mapping (VSM) [198,199,200,201,202,203,204]. In addition, the concept of the green approach has emerged within organizations, which aims to minimize the environmental impact of their operations while maximizing the efficient use of resources [205]. By implementing lean manufacturing practices, companies can not only reduce waste but also decrease pollution by optimizing cycle times and maximizing resource utilization [30]. Ref. [206] proposed an evaluation system to assess supply chain implementation in different firms, and their research confirmed a strong correlation between green initiatives and the successful adoption of lean principles. To examine this relationship in the Saudi industrial sectors, the researchers developed the following hypothesis

H6. 

LM is mediating the relationship between GSCM and BP.

2.5.7. CSR Mediates the Relationship Between GSCM and BP

The correlation between CSR, GSCM, and BP has consistently attracted the attention of scholars and academics. Ref. [207] explains that CSR serves as a means for companies to integrate ethical practices into their business practices and extends beyond prioritizing profits. Over the past half-century, CSR has played a crucial role in assessing and disclosing a company’s environmental impact, as well as ensuring social responsibility toward stakeholders and the public [208]. According to [209], there is a strong correlation between CSR and financial performance and the competitive advantage of companies that engage in CSR activities. The study of [210] found that CSR plays a crucial role in determining the extent to which companies adopt GSCM practices. Furthermore, the study reveals that these practices have significant effects on various aspects of performance, including the environment, the economy, and operations. According to [211], CSR initiatives motivate companies to adopt GSCM, prioritizing environmental issues and considering the social and environmental requirements of various stakeholders. The authors further highlights the interdependence between green practices and employees, emphasizing that the adoption of green practices positively influences employee performance, which in turn enhances the effectiveness of the GSCM process. The relationship between CSR and GSCM is well-established, as indicated by [212]. According to these authors, the presence of social responsibility, both internal CSR and external CSR, has a favorable influence on GSCM. GSCM, in turn, positively affects the firm’s overall performance. Additionally, ref. [213] highlight the numerous advantages of CSR practices, including increased business opportunities, enhanced brand image and reputation, and mitigated risks related to the materials supply chain. Therefore, the researcher hypothesized the following:

H7. 

CSR mediates the relationship between GSCM and BP.

3. Methods and Materials

The current research aims to examine the relationship between GSCM and BP through the mediating role of LM and CSR and in the context of the industrial sector in Saudi Arabia. Utilizing a quantitative approach is appropriate for research objectives to answer the research questions. Data were collected from managers working in the Eastern Region, which is the largest region in the Kingdom. A primary reason for selecting managers as the focus of this study is because they are responsible for overseeing departmental operations and have extensive knowledge of GSCM, LM, and CSR principles. Moreover, managers have a holistic understanding of their business’s performance at different levels. The data were collected over a period of five weeks through an online questionnaire, which was created specifically for this study using Google Forms, from 26 February to 31 March 2024. Five hundred managers were originally invited, and data were ultimately collected from 345 industrial managers for an effective response of 69%. Sample demographics are displayed in Figure 2. The survey questions were carefully crafted to maintain confidentiality, clarity, and suitability to the specific context of the Saudi industrial sector. Moreover, the survey length was thoroughly controlled to sustain participants’ engagement. Two distribution techniques employed for data collection were social networking and the snowball method among managers [214]. Informed consent for participation in the study has been obtained (See Questionnaire for more details). Institutional Review Board Approval (IRBA) has been granted with reference number SEURES-4601.

3.1. Data Collecting and Instruments

In this study, the items on the questionnaire were derived from existing research studies. The GSCM constructs were adapted because they demonstrated strong validity and reliability, were easily understood, and covered a wide range of sub-variables. First, the GP construct, originally developed by [10,39,57], has been utilized by [42,58] and incorporated four items to measure the GP construct. The ECD construct was developed by [10,39,57], used by [42,58], and incorporated four items to measure the ECD construct. Furthermore, Ref. [39] introduced the IEM construct, which demonstrated strong reliability in studies conducted by [42]. This construct includes four items that assess the IEM construct. In addition, the BP construct was developed by [215,216] and used by [75], who utilized both FP and MP constructs that incorporate 3 and 4 items, respectively.

To measure the construct of CSR, four items were included, which were derived from previous studies on CSR [217,218] and were used by [128]. These items encompass dimensions such as the social dimension and the stakeholder dimension, and their reliability and validity were strongly supported by the original research studies. Additionally, the LM constructs have been adapted because they are valid, reliable, clear, and inclusive of various factors. The TQM construct was developed by [117,219] and incorporated three items to measure the TQM construct. The JIT construct was adapted from [117,194,203] and consisted of four items to assess the JIT construct. In addition, the TPM construct was developed by [115,116,117] and incorporated four items to measure the TPM construct.

The researcher collected data for this study through a single survey consisting of four sections. The first section, designed by the authors, aimed to gather information about respondents’ characteristics. The remaining sections focused on participants’ ratings of their experiences in the industry, specifically in terms of green supply chain management (GSCM), Business performance (BP), Lean management (LM), and Corporate Social Responsibility (CSR) preferences across various dimensions. The questionnaire was created utilizing a rating system consisting of five points on the Likert scale (1 = strongly disagree; 2 = disagree, 3 = Neither agree nor disagree, 4 = agree, and 5 = strongly agree).

The study utilized a five-point Likert scale to measure each construct, with reliability, factor loadings, and goodness-of-fit analyses performed on each scale (see Appendix A for more details). Additionally, the empirical data were subjected to quantitative analysis to examine relationships between variables. Furthermore, Structural Equation Modeling (SEM) was employed to test the mediating hypothesis, offering a more integrated approach compared to conducting separate regression analyses [220].

3.2. Data Analysis Procedure

To conduct structural equation modeling (SEM), it is advisable to use a two-step modeling technique as proposed by [221]. In this method, the first stage involves identifying the latent constructs and their corresponding indicators, assessing the reliability of the items, as well as examining the factor loadings and confirmatory factor analysis. Additionally, the constructs’ correlations, covariances, and significance, along with the goodness-of-fit for each scale, are examined. In the second stage, the focus was on the structural model, where the main objective was to accurately represent the relationships between constructs. This two-step approach was implemented to ensure the reliability of the measurements and to prevent any interference between the measurements and the structural model [222].

4. Analysis and Results

4.1. Analysis of Results and Hypotheses Testing

In this section of the study, we will delve into descriptive statistics and evaluate the reliability of the constructs through the utilization of Cronbach’s Alpha. The relationship between the four main variables in this study and the seven hypotheses is examined and evaluated using well-known statistical analysis techniques like Structural Equation Modeling (SEM) and confirmatory factor analysis (CFA) with the utilization of IBM Amos (v.29).

4.2. Descriptive Statistics

Descriptive statistics presented in the first section of the questionnaire, as depicted in (Figure 2), reveal that the majority (more than 50%) of respondents were individuals in the 30–39 age group, which closely aligned with the median age of the population in the Kingdom (GASTAT’s 2023). Furthermore, the data indicate that a significant proportion (over 60%) of the participants were classified as lower managers, while the remaining respondents consisted of middle and top managers in industrial sectors. Moreover, the majority of respondents have professional experience ranging from 1 to 10 years, which provides a valuable and knowledgeable perspective on employment trends in the industry. Furthermore, an overwhelming majority of over 77% of the participants hold undergraduate degrees or higher qualifications. In terms of industry concentration, the sample population is predominantly from the oil and gas sector (both primary and secondary industrial sectors), representing over 30%, followed by financial services at 14%. Other subsectors, such as industrial services (including design, drilling, and maintenance), production manufacturing, and science and technology research centers, show representations ranging from 5% to 9%. However, approximately 34% of the sample population is employed in other sectors.

4.3. Measurement Model Analysis

In this study, we employed structural equation modeling (SEM) to evaluate our proposed framework [220]. We adhered to the two-phase methodology outlined by [221], which involves initially establishing a measurement model followed by a causal structural model. To ensure the reliability and validity of the measurement items in accordance with their respective unobserved constructs, we implemented the recommendation by (Amoako et al., 2022) to consolidate items that loaded onto disparate constructs and displayed weak factor loadings (below 0.5). Subsequently, confirmatory factor analysis (CFA) was conducted using IBM Amos (v.29) to evaluate the Standard Factor Loadings (SFL), Cronbach Alpha (CA), Average Variance Extracted (AVE), and Composite Reliability (CR), following the methodology delineated by (Dogbe et al., 2020) (see

Table 1. Measures and CFA.

Variables	Cronbach’s α	CR	AVE	Std. Factor Loading
Green Supply Chain Management	0.95	0.966	0.903
Eco-Design				0.812–0.849
Eco.1–Eco.4
Green Purchasing				0.825–0.859
GP.1–GP.4
Internal Environmental Management				0.798–0.859
IEM.1–IEM.4
Lean Management	0.94	0.973	0.922
Total Quality Management				0.79–0.834
TQM.1–TQM.3
Just in Time				0.749–0.831
JT.1–JT.4
Total Productive Maintenance				0.834–0.863
TPM.1–TPM.4
Business Performance	0.93	0.973	0.947
Marketing Performance				0.829–0.883
MP.1–MP.4
Financial Performance				0.835–0.870
FP.1–FP.3
Corporate Social Responsibility	0.89	0.905	0.705
Social and Stakeholder Dimensions				0.816–0.853
CSR.1–CSR.4

). Our analysis confirmed the retention of all measurement items, as they exhibited SFL values surpassing 0.50, thereby meeting the requisite criterion. Internal reliability among the measurement items was assessed through CA and CR calculations, with results indicating that all latent variables demonstrated CA and CR values exceeding the recommended threshold of 0.7 as proposed by [223], affirming high internal reliability. Additionally, AVEs were computed to establish convergent validity, revealing that AVEs for all latent variables surpassed the minimum threshold of 0.5, consistent with guidelines proposed by [220]. Furthermore, the model fit of the dataset was evaluated using AMOS, with results indicating favorable fit indices: CMIN/DF below 3, CFI and TLI exceeding 0.9, and RMSEA and RMR below 0.08 (see

Table 2. Goodness of Fit Index of the model.

GOFI	GOFI Criteria	Results	Interpretation
RMSEA	≤0.08	0.058	Good fit
TLI	≥0.90	0.941	Good fit
CFI	≥0.90	0.946	Good fit
GFI	≥0.90	0.901	Good fit
RMR	≤0.08	0.031	Good fit

CMIN = 1089.013; DF = 507; CMIN/DF = 2.148.

and Figure 3).

Accordingly, we concluded that the dataset adequately fits the proposed model. The utilization of AMOS as the analytical tool conferred advantages owing to its robust capabilities in structural equation modeling, facilitating the inclusion of complex relationships such as mediation alongside control variables with enhanced precision. Unlike certain other software, AMOS allows for the simultaneous regression of multiple dependent variables on independent variables.

4.4. Hypotheses Testing Results

The data were analyzed using SEM in Amos (V.29). Moreover, 5000 bootstrap samples were used in the bias-corrected percentile method of bootstrapping at a 95% confidence interval. Estimating our proposed model, we controlled for firm size (number of employees) and industry due to their probable effect on business performance. Our results are presented in (

Table 3. Path Estimates.

Observed Variables	Direct Effect	Indirect Effect	p
GSCM → Bus. Perf.	0.424	-	0.000
GSCM → Lean Mgt.	0.809	-	0.000
GSCM → CSR	0.891	-	0.000
Lean Mgt. → Bus. Perf.	0.407	-	0.000
CSR → Bus. Perf.	0.100	-	0.175
GSCM → CSR → Bus. Perf.	-	0.089	0.568
GSCM → Lean Mgt. → Bus. Perf.	-	0.329	0.028

and Figure 4) showing the unstandardized coefficients of variables of interest and control variables, e.g., firm size = 0.02 and industry = −0.01. This implies that, for every unit change in firm size, there will be a corresponding change in employee environmental performance by 0.02 units, meaning as firm size increases, business performance increases. It is worth mentioning, though, that both control variables were statistically insignificant (p-value > 0.05).

Our hypotheses are presented diagrammatically (refer to Figure 1 for conceptual framework). Figure 4 displays the output of the SEM analysis. As can be seen, the standardized coefficient for indirect and direct effects facilitated the path analysis testing revealing the following (

Table 4. Hypothesis outcomes.

Hypothesis	Path	Beta (β)	p-Value	Outcome
HI	GSCM positively impacts BP	0.424	<0.001	Supported
H2	GSCM positively impacts LM	0.809	<0.001	Supported
H3	GSCM positively impacts CSR	0.891	<0.001	Supported
H4	LM positively impacts BP	0.407	<0.001	Supported
H5	CSR positively impacts BP	0.10	0.175	Not Supported
H6	GSCM impacts BP via CSR	0.089	0.568	Not Supported
H7	GSCM impacts BP via LM	0.329	0.028	Supported

):

Hypothesis 1, which posits a direct positive effect of green supply chain management on business financial and marketing performance, yielded a beta coefficient (β) of 0.424 with a p-value less than 0.05 (p < 0.001). Therefore, we can conclude that there is a significant effect, indicating that a 1-unit change (increase) in green supply chain management practices corresponds to a 0.424 unit increase in business financial and marketing performance; thus, H1 is supported.

Hypothesis 2, which posits a positive effect of green supply chain management on lean management outcomes, yielded a beta coefficient (β) of 0.809 with a p-value less than 0.05 (p < 0.001). Therefore, we can conclude that there is a significant effect, indicating that a 1-unit change (increase) in green supply chain management practices corresponds to a 0.809 unit increase in lean management outcomes; thus, H2 is supported.

Hypothesis 3, which posits a positive effect of green supply chain management on corporate social responsibilities, yielded a beta coefficient (β) of 0.891 with a p-value less than 0.05 (p < 0.001). Therefore, we can conclude that there is a significant effect, indicating that a 1-unit change (increase) in green supply chain management practices corresponds to a 0.891 unit increase in corporate social responsibility; thus, H3 is supported.

Hypothesis 4, which posits a positive effect of lean management outcomes on business performance, yielded a beta coefficient (β) of 0.407 with a p-value less than 0.05 (p < 0.001). Therefore, we can conclude that there is a significant effect, indicating that a 1-unit change (increase) in lean management outcomes corresponds to a 0.407 unit increase in business financial and marketing performance; thus, H4 is supported.

Hypothesis 5, which posits a positive effect of corporate social responsibility on business financial and marketing performance, yielded a beta coefficient (β) of 0.10 with a p-value greater than 0.05 (p = 0.175). Therefore, we can conclude that there is an insignificant effect of CSR on business financial and marketing performance; thus, H5 is rejected.

Hypothesis 6, which posits an indirect positive effect of green supply chain management practices on business financial and marketing performance through the mediating factor of corporate social responsibilities, yielded a beta coefficient (β) of 0.089 with a p-value greater than 0.05 (p = 0.568). Thus, the indirect mediating effect of corporate social responsibility is insignificant, which leads to the rejection of H6.

Hypothesis 7, which posits an indirect positive effect of green supply chain management practices on business financial and marketing performance through the mediating factor lean management outcomes, yielded a beta coefficient (β) of 0.329 with a p-value less than 0.05 (p = 0.028). Therefore, we can conclude that there is a significant mediating effect, indicating that through lean management outcomes, 1-unit change (increase) in green supply chain management practices leads to a 0.329 unit increase in business financial and marketing performance; thus, H7 is supported.

Our findings reveal both a direct effect and a partial mediation effect within our tested model. After controlling for firm size and sector, we observe that green supply chain management practices exert a positive direct influence on business financial and marketing performance. Also, we note that green supply chain management practices positively influence both lean management outcomes and business corporate social responsibility. However, we did not find a significant effect of corporate social responsibility on business financial and marketing performance, and additionally, no mediating effect of CSR between green supply chain management practices and business financial and marketing performance. However, we do identify a significant mediating effect of lean management outcomes between green supply chain management practices and business financial and marketing performance.

Thus, our analysis indicates that a significant effect arises from green supply chain management practices for the following: (1) Business financial and marketing performance; (2) Business corporate social responsibility; (3) Lean management outcomes. Also, we demonstrate that there is an indirect effect between green supply chain management practices and business performance driven by lean management outcomes. This underlines the pivotal role of lean management outcomes as the sole significant mediator between green supply chain management practices and enhanced business financial and marketing performance in our sample.

5. Discussion

This study reveals the main distinctions between green supply chain management (GSCM), lean management (LM) and corporate social responsibility (CSR) initiatives, and their influence on business performance outcomes (BP). The results demonstrate the highly significant direct positive effect of GSCM adoption on perceived business performance; Hypothesis 1 was supported by this finding. This can be explained by the resource-intensive approach to environmental sustainability and supply chain operations, whereby more innovative strategies within the supply chain equate to improved resource efficiencies, cost reductions, superior product quality, innovation capabilities, and market status [224].

Moreover, it is illustrated that the application of GSCM affected the rate of LM implementation and the level of CSR activities, which also confirms Hypotheses 2 and 3. This points to these enterprises being the major contributors to the incorporation of environmental sustainability in their supply chain processes, which in turn lead to various lean philosophy approaches such as waste reduction, efficiency enhancement, and quality improvement, as well as CSR programs. This finding is critical since GSCM is considered a core structural element that ensures organizations adopt inclusive sustainability approaches that offer environmental and social benefits in addition to economic aims.

Based on Hypothesis 4, our research indicated the significance of lean management on the organization’s performance. These findings adhere to the long-lasting belief that Lean Management techniques (such as Just-in-Time, Total Quality Management and productive maintenance) can generate substantial gains in operational efficiency, cost-competitiveness, quality, and performance which will reflect in an improved bottom line [167]. In contrast, while no supporting evidence was found between the adoption of CSR practices and business performance (Hypothesis 5 not supported), it was established that there is a relationship between them. This relationship seems to be different from what several previous scholars have concluded regarding CSR, in particular that it yields both financial and non-financial benefits, such as reputational gains and customer loyalty [38]. A possible reason for this difference lies in the particular industrial sector context of the current research, where CSR impacts may not be so significant or stand out in the short-term.

Identifying the contained mediating effects of LM and CSR, it was found that hypothesis 7 was supported. This proves that financial and operating returns from the supply chain management with green practices are really effective because of the support given by lean management practices, which result in a reduction in costs, a reduction in waste, and an improvement in quality. In contrast, there was no passing of the baton effect through the CSR channel, which influenced business performance improvement (Hypothesis 6 was not confirmed). A key inference is that although GSCM may lead to the greater involvement of CSR, the financial returns may be observed regarding LM or even directly, and especially in industrial environments. This contradicts some research on consumer markets, which found an articulating effect of CSR in supporting the efficacy of GSCM to improve financial performance [150]. Therefore, the main conclusion is that lean management remains a crucial tool when applying the GSCM and, as such, when improving business performance. This calls attention to the need for a more effective transition between traditional supply chains and green ones.

The studies’ findings share several similarities with other related studies. For example, previous studies have reported further gains in performance from GSCM implementation because of efficiency, quality, innovation, and reputation [10,39]. Just like previously referred research, the mediating effect of LM also confirms the role of LM in enabling returns on the strategies of sustainability, especially in the manufacturing context [81,196]. Alternatively, though, the research results contrast with some studies, which found that CSR performance was more critical within the consumer industries [150]. No attention has been drawn to the social role of business in transmission channels, which is an important area for further investigation. An important contribution of this study was that it responded to the call expressing the need to understand GSCM-performance links in scenarios with a non-Western cultural environment [225].

Such results are of great significance to the paradigm of GSCM and to the academic community studying their performance. First, the results of the research confirm the hypothesis about the beneficial consequences of green supply chain management, which substantiates the natural resource-based view that companies can achieve a competitive advantage by implementing proactive environmental policies. These policies, in turn, help leverage the enterprise’s internal and external capabilities to promote efficiency and market domination [224]. In addition to this, LM is an empirical embodiment of the notion that contiguity is multidirectional, with the efficiency effect of ecological practices being reinforced [196]. Precisely, CSG performance improvement gains are obtained by integrating it with other contextual initiatives, such as LM, that help to enhance performance. Thus, the nonexistence of CSR mediation effects points to the fact that a different mechanism can underlie the connection, which would explain the relationship between industrial and consumer GSCM approaches. Reflections with system theories connected to method-specific context may aid scholarly comprehension. Finally, even though the study provides some meaningful theoretical contributions, it is important that further research is undertaken that includes cultural factors and the boundaries of predominant theories to provide richer explanations.

Ultimately, this study fulfills its objectives of contributing useful ideas to a largely under-researched Middle Eastern area. At the same time, it paves the way for more context-specific and multi-theory frameworks that would help provide theoretical perspectives on GSCM and sustainability research. Considering cultural and institutional aspects in further research is likely to provide more elaborate and realistic contributions regarding the connections between the goals of GSCM, operational programs such as LM and CSR, and performance results.

Theoretical Implications

This research investigates and determines the causal linkages between green supply chain management, lean management, and CSR for overall business performance. The literature has significant theoretical gaps; therefore, this research is pioneering the empirical examination of these relationships in Saudi Arabia’s current industrial sector. First, in previous research in this area, GSCM was studied independently, as were operational leanness and CSR. The current research is the first to integrate all these aspects within a unified model. Moreover, interconnectedness, especially the buffering effect of lean management, is inherently emphasized by the research since it illustrates the necessity to study the role of sustainable supply chain practices, which lies within the operational excellence perspective rather than the social responsibility or isolated environment perspective. The confirmations uphold the central role of lean thinking in the 3PL network as the primary avenue for enacting GSCM, which can positively affect business performance.

Another noteworthy point is that most previous empirical research has evaluated the performance impact only using financial or cost-related metrics, while the current study provides a combined index of financial and marketing-related performance indicators. The balanced scorecard is a way to link GSCM goals to revenue, profitability, cost efficiency, as well as market share and customer acquisition aspects. The discussion indicates that managers who adopt this approach achieve broader business benefits than those who adopt a narrow focus on either operation or return on investment.

The research presents novel findings regarding CSCM in Saudi Arabia and GCC countries, an emergent area of research mainly concerned with corporate governance, energy security, or food supply matters. This study delivers comprehensive statistical analyses from field surveys that focus exclusively on industrial supply chains, logistics infrastructure, and lean integration possibilities in the Middle East to fill an existing research gap in this field. This is of high importance for the ongoing Vision 2030, which is all about industrial diversification and competitiveness in global markets; hence, these findings contribute invaluable analytics to formulate sound policy decisions and business leadership. In terms of methodology, rather than the usual regression models, the research uses structural equation modeling to establish causality between GSCM, mediator variables, and business performance. By adding this complex relationship between the dependent and the independent components, the path modeling procedure provides a path for developing more advanced analysis in future research focused on multidimensional relationship mechanisms.

Another advantage arises due to the sample being exclusively comprised, which provides more external validity than data from individual informants who are not high-level executives in their respective organizations. This route is preferred since it permits easy access to first-hand information, coming directly from cross-functional decision-makers, instead of relying on corporate documentation all the time, ultimately giving the analyst more primary data points to help arrive at the analytical conclusion. The breadth of managerial role representation in respondents may give rise to even more multidimensional and insightful observations of researchers pursuing such complex and multidimensional research.

6. Conclusions

This study presents significant contributions to green supply chain management practices, particularly in improving business performance outcomes through enhanced operational efficiency. The results show that applying more environmental sustainability to the flow of materials from manufacturing to end users greatly contributes to the lean thinking philosophy and helps improve overall business standards. Through lean management, it becomes evident that green supply chain management bridges the gap between business performance and the underlying green product/service objectives, thereby elevating the importance of waste and efficiency reduction techniques. The results show that green supply chain practices help firms reduce actual processing time, maximize resources used, and eliminate non-value-adding activities. These cost-containing and streamlining of management results can consequently lead to improved financial performance and marketing success. Consequently, the key leverage for sustainability in the industrial sector of Saudi Arabia is to perceive lean management as the means to translate sustainability pursuits into more effective production as well as less costly operations and greater competitiveness. It is a consistent finding that lean management is key in traditional studies on the relationship among the above aspects. Therefore, the green supply chains’ mission is to start with prompting lean production improvements as the basic lever for top line growth. CSR can be planned strategically for the long term and be aligned with bio modernization theory for value creation goals. The impact of Vision 2030’s sustainability and operational excellence can be evidenced by the stronger economic results and increased competitiveness it will yield for Saudi Arabia’s industry. The confirmation of the links between green supply chains, lean management, and performance is highly significant for governments and businesses regarding diversification, efficiency, community, and environmental objectives. Future research can use this foundation to analyze the green supply chain practices that have been most widely used and have resulted in innovative performance improvements. Given the increasing pace of sustainable transformation in many industrial supply chains, the reasons why companies should prefer an environmentally friendly approach will be more evident.

Managerial Relevance

The findings from this research have important practical implications for industrial managers in organizations that want to promote environmental and sustainable supply chain performance. The study’s findings show that GSCM’s role in enhancing a company’s performance generally illustrates the advantage of striving to transform the supply chain sustainably. Instead of considering green initiatives as further costs or added burdens, managers can view GSCM as a different method of boosting their financial and marketing performance through financial and marketing performance gains. In concrete terms, employing specifically chosen GSCM elements, such as supplier collaboration regarding the environment, internal environmental management, and investment recovery, can directly increase revenue and market share.

Moreover, managers’ ability to leverage GSCM principles and productive maintenance will determine business performance improvements based on GSCM adoption. Conjoint analysis revealed that a large part of businesses’ profitability from the greening of their supply chains is released through waste elimination, which goes beyond value addition. In operations, lean tools like Kaizen, process mapping, just-in-time scheduling, quality management, and inventory management can be applied by procurement, manufacturing, warehousing, and transportation managers forming the supply chain. Elimination of waste and ineffectiveness results in cost reduction and productivity enhancement from higher energy efficiency, lower emissions, and waste generation; lower three processes like this will compete and merge in the market, forming a single economic entity with a variety of products and services and satisfying the increasing needs and wants of consumers.

Consequently, whereas the quantitative research did not observe the same phenomenon for CSR, managers can still carry out the targeted community and stakeholder engagement tasks as complementary measures to their outwardly looking GSCM and disclosure policies. Therefore, companies such as those in Saudi Arabia that have declared their desire to protect the environment as one of the Vision 2030 goals have more substantial leverage to present themselves as benevolent corporate citizens. With such a provision, managers can, for example, line up their internal operations with their external ventures via partnerships, volunteer environmental programs, and awareness campaigns on sustainability. This should give them leverage in terms of equity and reputation. The ultimate goal of initiating cross-functional green teams is to support GSCM adoption in purchasing, manufacturing/operations, logistics, and marketing functions. CSR, HR, and external affairs teams can assist the teams in building a comprehensive plan. A case of “top-down” executive command and “bottom-up” employee participation through green initiatives, lean programs, and CSR drives delivers sizeable efficiency and stakeholder gains. Companies can also copy the implementation strategy of renowned global corporate leaders in sustainability, such as Walmart, IKEA, Toyota, etc., which would help them acquire suitable practices specific to the Saudi industrial context.

7. Limitations and Scope for Future Research

Although this research is extensive and deliberate regarding mediating effects in the Saudi context, the research has some limitations that prompt further studies. Firstly, including manufacturers and service providers alongside those who produce the finished goods will reveal if the linkages between GSCM performance and other parameters are similar. Additionally, the plan of spreading beyond the Eastern region to other regions of the country can increase representativeness. Moreover, qualitative studies such as case studies involving Saudi companies with GSCM practices can be a great addition to the framework in order to understand lean and CSR integration from a company perspective and expand the level of knowledge. The examination can be more independent and primarily related to production, allowing process manufacturing to spot the subtle adoption tendencies. Investigating such channels alongside numerical modeling carries huge prospects for GCC and Middle East-based GSCM research, national vision formation, and international collectivity to give rise to environmental sustainability in line with increasing economic expansion. In addition, future researchers can expand the scope of the proposed conceptual model by considering additional GSCM aspects such as carbon management, green manufacturing, and packaging, the moderation effects of variables such as supply-chain partners and supplier involvement, as well as mediators such as green intellectual capital.