Abstract

In an era where sustainability and innovation are widely recognized as critical drivers of corporate success and societal progress, their combined influence on persistent workplace inequalities—particularly the Gender Pay Gap (GPG)—remains underexplored. This study investigates how sustainability practices moderate the relationship between innovation—broadly defined to include both product and process innovation—and the GPG within organizations. Using exploratory factor analysis, we identify two distinct dimensions of corporate sustainability: (1) environmental and workplace safety initiatives, and (2) community and regional support initiatives. Regression analysis confirms that innovation is positively associated with the GPG, indicating a potential unintended consequence of innovation-driven strategies. However, the effect of innovation on the GPG is significantly moderated by the type and intensity of sustainability initiatives. Specifically, high levels of community- and region-focused sustainability (Factor 2) reverse the positive link between innovation and the GPG, fostering greater gender equity. In contrast, environmental and safety initiatives (Factor 1) display a more multifaceted role: at high levels, they tend to reinforce the innovation-GPG relationship, while at lower levels they may mitigate it. These findings highlight the strategic importance of tailoring sustainability initiatives to effectively align innovation efforts with gender equity goals. They offer valuable insights for organizations and policymakers aiming to integrate sustainability, innovation, and social inclusion into cohesive corporate strategies.

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