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On the implementation of a 'global' environmental strategy: The role of absorptive capacity

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  • Pinkse, Jonatan
  • Kuss, Matthias J.
  • Hoffmann, Volker H.

Abstract

This paper sheds light on factors influencing to what extent MNCs are able to implement a global environmental strategy. We apply the concept of absorptive capacity to analyze what role the uptake and integration of external knowledge plays in implementing an environmental strategy and propose to make a distinction between shared and unit-specific levels of absorptive capacity. Based on an in-depth investigation of the multinational chemical company BASF, we derive three propositions about the influence of absorptive capacity on the implementation of global environmental practices on the regional headquarters and subsidiary level. The main finding is that a shared level of absorptive capacity across subsidiaries facilitates a common understanding and use of environment-related knowledge, but, as environment-related knowledge often applies to a specific context only, there is also a need to build unit-specific absorptive capacity on a subsidiary level. By allowing subsidiaries to build their absorptive capacity, MNCs can more efficiently adapt global environmental practices and lower the cost of implementing a global environmental standard.

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Bibliographic Info

Article provided by Elsevier in its journal International Business Review.

Volume (Year): 19 (2010)
Issue (Month): 2 (April)
Pages: 160-177

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Handle: RePEc:eee:iburev:v:19:y:2010:i:2:p:160-177

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Related research

Keywords: Absorptive capacity Environmental management Headquarters-subsidiary relationship Knowledge sharing Sustainable development;

References

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Cited by:
  1. Gold, Stefan & Hahn, Rüdiger & Seuring, Stefan, 2013. "Sustainable supply chain management in “Base of the Pyramid” food projects—A path to triple bottom line approaches for multinationals?," International Business Review, Elsevier, vol. 22(5), pages 784-799.
  2. Holtbrügge, Dirk & Dögl, Corinna, 2012. "How international is corporate environmental responsibility? A literature review," Journal of International Management, Elsevier, vol. 18(2), pages 180-195.
  3. Kolk, Ans & van Tulder, Rob, 2010. "International business, corporate social responsibility and sustainable development," International Business Review, Elsevier, vol. 19(2), pages 119-125, April.

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