In this era of global warming, there is a great deal of pressure on businesses to decrease industrial waste to manage a sustainable environment. Therefore, the purpose of this research is to investigate these problems by introducing green organizational capital in manufacturing firms to improve environmental performance. This research is quantitative in nature and data were collected from small and medium-sized firms in Pakistan. Various directors and managers from SMEs are respondents to this study. For this study, the sample size is 190 from the manufacturing sectors. For testing the hypotheses while using SPSS version 25. Hence direct results supported the literature but GHRM as a moderator did not support it in developing countries. This report includes regulators and managers with advice for paying attention to the environment’s performance. As a result, the results supported both direct and indirect assumptions, with varied theoretical and managerial implications for management and policymakers in ensuring environmental performance contributing variables.

DOI: https://doi.org/10.3846/bm.2023.975