Abstract: Various studies have examined the relationship between intellectual property, Environmental Management Systems (EMSs) and innovation. Some of these studies have focused on identifying internal factors that provide competitive advantages to firms, which adopt EMS, while others examine external factors that promote environmental innovation to firms. This paper proposes a framework that encompasses internal and external factors to identify how EMS promotes innovation to firms, at the same time bearing the need to protect intellectual property. This framework is based on the institutional and resource-based theories and explains how firms may gain competitive advantage and enhance innovation from EMS implementation.