As a result of intensifying competition, growing environmental attitudes are attracting the attention of corporate stakeholders. This trend is driving efforts to achieve a green competitive advantage and consider the potential impact of green development practices on businesses. Despite their high relevance to the agro-based industry and recent emergence, the elements motivating green development behavior and green competitive advantage remain largely unexplored. This study’s goals are to create a theoretical model of green development behavior, test it against other models using data from Nigerian agro-allied industries, and then look at how green dynamic capability affects the results. The researchers used descriptive statistics and the partial least squares structural equation modeling (PLS-SEM) method to analyze data from 351 respondents from 12 listed agro-allied firms in Nigeria. The empirical results show that all dimensions of green development behavior—including company tangible resources, corporate intangible resources, market environment, public supervision and policy, and institutional environment—have a significant positive effect on determining green development behavior. Beyond that, it became clear that businesses with environmentally conscious practices can gain a long-term market advantage by embracing green development behavior and green dynamic capability, as evidenced by the Natural Resource-Based View (NRBV) theory, which posits a company’s competitive advantage in relation to its natural environment, hence, contributing to the fields of green behavior, green development theory, and business development theory.