Towards a green economy through innovations: The role of trade union involvement

In this paper, we address the overlooked issue of whether and how industrial relations might play a role in the process of greening the economy, primarily through the levers of innovation adoption and organisational change. We address our objective econometrically, assessing the quality of industrial relations as a driver of environmental innovation adoption, through the use of micro-data on manufacturing firms. The results yield two interesting main findings: being a unionised firm is not associated with the adoption of environmental innovation; however, when we consider the industrial relations climate, we observe a positive relationship between a cooperative industrial relations climate (union involvement) and the propensity to introduce environmental innovation. Two models are relevant: a managerially oriented model (unions are informed) and a participatory model (unions bargain on innovation adoption). The contents of environmental innovations are also important: union involvement is more relevant for adopting more complex and radical innovations to abate CO2 and EMS and ISO practices.