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Pains and gains of environmental management system certification for the sustainable development of manufacturing companies: Heterogeneous effects of industry peer learning

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  • Jing Wang
  • Yunshi Mao

Abstract

Environmental sustainability is a growing global concern. Environmental management systems (EMS) could be an effective strategic tool to help firms deal with their sustainable development. However, whether EMS certification pays off financially and how it takes effect can be debated. Thus far, these questions remain largely under‐researched. In particular, the effects of EMS certification on financial performance are inconclusive, and the reasons explaining the effects are underdeveloped. This study aims to enrich the current research by exploring the mediating and moderating roles from the perspective of cost‐efficiency trade‐offs to reveal how EMS certification affects financial performance. Applying a PROCESS procedure analysis and causal mediation analysis to a sample of 1,751 Chinese listed manufacturing firms from 2008 to 2016, this study shows that the effect of EMS certification on firms' financial performance is insignificant because their operating costs burden increases while their marketing efficiency and managerial efficiency improve. For the first time, this study demonstrates the moderating role of industry peer learning, as the mediating effects decrease with the growth of industry peer learning.

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  • Jing Wang & Yunshi Mao, 2020. "Pains and gains of environmental management system certification for the sustainable development of manufacturing companies: Heterogeneous effects of industry peer learning," Business Strategy and the Environment, Wiley Blackwell, vol. 29(5), pages 2092-2109, July.
    • Handle: RePEc:bla:bstrat:v:29:y:2020:i:5:p:2092-2109
    DOI: 10.1002/bse.2489
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    3. Yu Bai & Yuchen Xu & Jianling Jiao, 2022. "Can corporate environmental management benefit from multirelationship social network? An improved maturity model and text mining based on the big data from Chinese enterprises," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 24(4), pages 5783-5810, April.
    4. Adriana Liute & Maria Rosa De Giacomo, 2022. "The environmental performance of UK‐based B Corp companies: An analysis based on the triple bottom line approach," Business Strategy and the Environment, Wiley Blackwell, vol. 31(3), pages 810-827, March.

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