The study examines the relationship between green innovations, firms’ energy expenditures, and sales revenue performance using firm-level data from the Philippines. By applying advanced Machine Learning prescriptive analytics and trust-region iteration algorithms for Multivariate Copula model estimation, the research uncovers complex, non-linear dependencies between sustainability investments and financial outcomes. The findings indicate that Energy Star-rated appliances reduce electricity expenditure, while energy-efficient lighting alone may increase costs due to operational adjustments. Additionally, firms with greater financial flexibility, such as access to overdraft facilities and checking accounts, demonstrate stronger revenue performance, emphasizing the role of liquidity in supporting green investments. Energy monitoring practices also contribute to electricity cost mitigation and operational efficiency. However, firms adopting both green technologies simultaneously may experience short-term revenue declines, suggesting trade-offs between sustainability investments and financial performance. From a theoretical perspective, this research extends the Resource-Based View (RBV) by framing green innovations as strategic resources that impact firm competitiveness through cost efficiency and market positioning. The study offers actionable insights for businesses, advocating for a balanced approach to sustainability investments, financial planning, and digital adoption. Moreover, the research aligns with key United Nations Sustainable Development Goals (SDGs), particularly SDG 7 (Affordable and Clean Energy), SDG 8 (Decent Work and Economic Growth), SDG 9 (Industry, Innovation, and Infrastructure), and SDG 12 (Responsible Consumption and Production). With significant implications for business strategy and policy development, this study lays a foundation for future research on the long-term financial impact of sustainability initiatives in emerging economies.

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Green Innovations and Firms’ Energy Expenditure-Sales Revenue Nexus in the Philippines: Evidence from AI Based Prescriptive Analytics

  • Ibrahim Niankara,
  • Ghaleb El-Rafae,
  • Zafar Husain,
  • Amer Qasim,
  • Rachidatou I. Traoret

摘要

The study examines the relationship between green innovations, firms’ energy expenditures, and sales revenue performance using firm-level data from the Philippines. By applying advanced Machine Learning prescriptive analytics and trust-region iteration algorithms for Multivariate Copula model estimation, the research uncovers complex, non-linear dependencies between sustainability investments and financial outcomes. The findings indicate that Energy Star-rated appliances reduce electricity expenditure, while energy-efficient lighting alone may increase costs due to operational adjustments. Additionally, firms with greater financial flexibility, such as access to overdraft facilities and checking accounts, demonstrate stronger revenue performance, emphasizing the role of liquidity in supporting green investments. Energy monitoring practices also contribute to electricity cost mitigation and operational efficiency. However, firms adopting both green technologies simultaneously may experience short-term revenue declines, suggesting trade-offs between sustainability investments and financial performance. From a theoretical perspective, this research extends the Resource-Based View (RBV) by framing green innovations as strategic resources that impact firm competitiveness through cost efficiency and market positioning. The study offers actionable insights for businesses, advocating for a balanced approach to sustainability investments, financial planning, and digital adoption. Moreover, the research aligns with key United Nations Sustainable Development Goals (SDGs), particularly SDG 7 (Affordable and Clean Energy), SDG 8 (Decent Work and Economic Growth), SDG 9 (Industry, Innovation, and Infrastructure), and SDG 12 (Responsible Consumption and Production). With significant implications for business strategy and policy development, this study lays a foundation for future research on the long-term financial impact of sustainability initiatives in emerging economies.