MODERATING EFFECT OF ORGANIZATION CULTURE ON SUSTAINABLE GREEN PROCUREMENT PRACTICES AND ORGANIZATIONAL PERFORMANCE OF MANUFACTURING FIRMS IN NAIROBI COUNTY

Abstract

Manufacturing firms in Nairobi County can achieve strong organizational performance characterized by high productivity, efficiency, profitability, and quality standards through sustainable green procurement practices. However, the sector continues to face persistent challenges such as limited technical efficiency, declining GDP contribution, and shrinking market share. Despite contributing 17.30% of total tax revenue, the sector’s technical efficiency remains comparatively lower. Therefore, the main objective of this study was to establish the moderating effect of organizational culture on the relationship between sustainable green procurement practices and organizational performance of manufacturing firms in Nairobi County. The specific objectives were to determine the influence of green product selection practice, green supplier selection practice, and green product lifecycle practice on organizational performance, and to examine the moderating effect of organizational culture on these relationships. The study was guided by Ecological Modernization Theory, Stakeholder Theory, and the Theory of Performance. An explanatory research design was employed, targeting 554 procurement managers across all manufacturing firms in Nairobi County, from which a sample of 232 respondents was obtained using Yamane’s formula. Stratified random sampling was used to ensure representation, and structured questionnaires were employed to collect primary data. A pilot study conducted in Nakuru County tested the instruments for validity and reliability. Data were analyzed using descriptive and inferential statistics through SPSS version 25, where descriptive analysis included means, frequencies, minimums, maximums, and standard deviations, while inferential analysis involved correlation and regression models. The findings revealed that green product selection practice (β=0.165, p=0.002), green supplier selection practice (β=0.226, p=0.001), green product lifecycle practice (β=0.306, p<0.001), and organizational culture (β=0.074, p=0.047) had a positive and significant effect on organizational performance. Moreover, results indicated that organizational culture significantly moderated the relationships between green product selection practice (β=−0.036, p=0.045, R2=0.573, ΔR2=0.019), green supplier selection practice (β=0.049, p<0.001, R2=0.583, ΔR2=0.010), and green product lifecycle practice (β=−0.084, p<0.001, R2=0.593, ΔR2=0.010) with organizational performance. The study concluded that integrating green product selection, supplier collaboration, lifecycle management, and a sustainability-oriented organizational culture enhances manufacturing firms’ performance, cost-effectiveness, and competitiveness while strengthening environmental and social responsibility. Theoretically, the study reinforces the explanatory strength of Ecological Modernization, Stakeholder, and Performance theories by demonstrating that culture-driven sustainability practices significantly predict firm performance outcomes. The study recommends that firms cultivate sustainability-focused cultures, integrate green product, supplier, and lifecycle initiatives, align cultural values with environmental goals, participate in environmental certification programs, provide continuous employee training, and establish partnerships with environmentally responsible suppliers to optimize sustainability performance and long-term organizational success. The study findings provided valuable insights into how sustainable green procurement practices, moderated by organizational culture, influence organizational performance among manufacturing firms in Nairobi County, offering practical implications for managers, policymakers, and researchers.