Green Human Resource Practices and Environmental Awareness as Drivers of Organizational Sustainability: The Mediating Role of Environmental Innovation in Pakistan’s Banking Sector

Abstract

This study explores how green human resource practices (GHRP) and environmental awareness contribute to organizational sustainability in Pakistan’s banking sector. The research further examines the mediating role of environmental innovation, aiming to determine how workforce-focused green initiatives and awareness translate into sustainable outcomes through innovative environmental solutions. A quantitative, cross-sectional approach was adopted. Data were gathered from branch managers, operational officers, and CSR personnel working in major commercial banks across Lahore, Karachi, Rawalpindi, and Multan. Using simple random sampling, 480 valid responses were collected. Smart-PLS 4.0 was used to test the measurement and structural models. The model incorporated two independent variables (green HR practices and environmental awareness), one mediating variable (environmental innovation), and one dependent variable (organizational sustainability). Environmental innovation acted as a strong partial mediator, showing that banks with effective green practices and environmentally aware employees are more likely to develop innovative eco-friendly products, processes, and policies ultimately strengthening sustainability performance. The model demonstrated high reliability and substantial predictive capability.