Industry 4.0 Technology Adoption and Sustainable Business Performance: The Mediating Role of Green Supply Chain Management and the Moderating Effects of Sustainability Awareness

Abstract

The growing adoption of Industry 4.0 technologies has transformed organizational processes, yet the mechanisms through which digital transformation enhances sustainable business performance remain unclear, especially in emerging economies. Drawing on the Resource-Based View, Natural Resource-Based View, Dynamic Capabilities Theory, and Upper Echelons Theory, this study examines the impact of Industry 4.0 technology adoption on Sustainable Business Performance (SBP), emphasizing the mediating role of Green Supply Chain Management (GSCM) and the moderating effect of Sustainability Awareness (SA). Using survey data from 355 manufacturing firms in Pakistan, India, and Bangladesh, the study applies Partial Least Squares Structural Equation Modeling (PLS-SEM) to test a moderated mediation framework. The results indicate that Industry 4.0 adoption significantly improves both GSCM and sustainable business performance. GSCM serves as a strong mediator, suggesting that digital technologies contribute to sustainability primarily by strengthening green supply chain practices. Moreover, Sustainability Awareness enhances the effects of Industry 4.0 adoption on GSCM, strengthens the influence of GSCM on sustainable performance, and amplifies the overall indirect impact of digital adoption on sustainability outcomes. These findings demonstrate that technological capabilities generate sustainable value most effectively when embedded in green operational processes and guided by sustainability-oriented managerial cognition. This study contributes to the digital sustainability and supply chain literature by offering a process-based, context-sensitive explanation of how Industry 4.0 fosters sustainable business performance, providing practical insights for managers and policymakers seeking to align digital transformation with long-term environmental, social, and economic goals.