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Do environmental management systems improve business performance in an international setting?

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  • Darnall, Nicole
  • Henriques, Irene
  • Sadorsky, Perry
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    Abstract

    With the worldwide increase in the adoption of environmental management systems (EMSs), some research has emerged that evaluates the reasons why facilities adopt them. However, there is little information about how these motivations extend to different international settings, and the link between the comprehensiveness of an EMS and business performance has yet to be demonstrated. While both institutional pressures and resources and capabilities may encourage EMS adoption and improved business performance, questions remain about whether organizations that are motivated mainly by their resources and capabilities benefit to the same extent as organizations that are driven to adopt an EMS mainly because of institutional pressures. We analyze these relationships using OECD survey data from manufacturing facilities operating in Canada, Germany, Hungary, and the United States. Our results show that facilities that are motivated to adopt more comprehensive EMSs because of their complementary resources and capabilities, such as export orientation, employee commitment and environmental R&D, (as opposed to institutional pressures) observe greater overall facility-level business performance.

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    Bibliographic Info

    Article provided by Elsevier in its journal Journal of International Management.

    Volume (Year): 14 (2008)
    Issue (Month): 4 (December)
    Pages: 364-376

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    Handle: RePEc:eee:intman:v:14:y:2008:i:4:p:364-376

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    Related research

    Keywords: Institutional theory Resource-based view of the firm Environmental strategy Environmental management system Competitive advantage Business performance;

    References

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    1. Anton, Wilma Rose Q. & Deltas, George & Khanna, Madhu, 2002. "Incentives for Environmental Self-Regulation and Implications for Environmental Performance," Working Papers 02-0120, University of Illinois at Urbana-Champaign, College of Business.
    2. Christine Oliver, 1997. "The Influence of Institutional and Task Environment Relationships on Organizational Performance: The Canadian Construction Industry," Journal of Management Studies, Wiley Blackwell, vol. 34(1), pages 99-124, 01.
    3. Christainsen, Gregory B. & Haveman, Robert H., 1981. "The contribution of environmental regulations to the slowdown in productivity growth," Journal of Environmental Economics and Management, Elsevier, vol. 8(4), pages 381-390, December.
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    5. Khanna, Madhu & Damon, Lisa A., 1999. "EPA's Voluntary 33/50 Program: Impact on Toxic Releases and Economic Performance of Firms," Journal of Environmental Economics and Management, Elsevier, vol. 37(1), pages 1-25, January.
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    7. Henriques, Irene & Sadorsky, Perry, 1996. "The Determinants of an Environmentally Responsive Firm: An Empirical Approach," Journal of Environmental Economics and Management, Elsevier, vol. 30(3), pages 381-395, May.
    8. Madhu Khanna & William Rose Q. Anton, 2002. "Corporate Environmental Management: Regulatory and Market-Based Incentives," Land Economics, University of Wisconsin Press, vol. 78(4), pages 539-558.
    9. Charles J. Corbett & María J. Montes-Sancho & David A. Kirsch, 2005. "The Financial Impact of ISO 9000 Certification in the United States: An Empirical Analysis," Management Science, INFORMS, vol. 51(7), pages 1046-1059, July.
    10. Martin Falk, 2002. "Endogenous organizational change and the expected demand for different skill groups," Applied Economics Letters, Taylor & Francis Journals, vol. 9(7), pages 419-423.
    11. Rondinelli, Dennis A. & Berry, Michael A., 2000. "Environmental citizenship in multinational corporations: social responsibility and sustainable development," European Management Journal, Elsevier, vol. 18(1), pages 70-84, February.
    12. Matthew Potoski & Aseem Prakash, 2005. "Covenants with weak swords: ISO 14001 and facilities' environmental performance," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 24(4), pages 745-769.
    13. Robert D. Klassen & Curtis P. McLaughlin, 1996. "The Impact of Environmental Management on Firm Performance," Management Science, INFORMS, vol. 42(8), pages 1199-1214, August.
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    Cited by:
    1. Massimo Battaglia & Francesco Testa & Lara Bianchi & Fabio Iraldo & Marco Frey, 2014. "Corporate Social Responsibility and Competitiveness within SMEs of the Fashion Industry: Evidence from Italy and France," Sustainability, MDPI, Open Access Journal, vol. 6(2), pages 872-893, February.
    2. Fisher-Vanden, Karen & Thorburn, Karin S., 2011. "Voluntary corporate environmental initiatives and shareholder wealth," Journal of Environmental Economics and Management, Elsevier, vol. 62(3), pages 430-445.
    3. Darnall, Nicole & Seol, Inshik & Sarkis, Joseph, 2009. "Perceived stakeholder influences and organizations' use of environmental audits," Accounting, Organizations and Society, Elsevier, vol. 34(2), pages 170-187, February.
    4. 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.
    5. 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.
    6. Reimann, Felix & Ehrgott, Matthias & Kaufmann, Lutz & Carter, Craig R., 2012. "Local stakeholders and local legitimacy: MNEs' social strategies in emerging economies," Journal of International Management, Elsevier, vol. 18(1), pages 1-17.
    7. Lanfranchi, Joseph & Pekovic, Sanja, 2014. "How green is my firm? Workers' attitudes and behaviors towards job in environmentally-related firms," Ecological Economics, Elsevier, vol. 100(C), pages 16-29.
    8. Yang, Chung-Shan & Lu, Chin-Shan & Haider, Jane Jing & Marlow, Peter Bernard, 2013. "The effect of green supply chain management on green performance and firm competitiveness in the context of container shipping in Taiwan," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 55(C), pages 55-73.
    9. Aguilera-Caracuel, Javier & Hurtado-Torres, Nuria Esther & Aragón-Correa, Juan Alberto & Rugman, Alan M., 2013. "Differentiated effects of formal and informal institutional distance between countries on the environmental performance of multinational enterprises," Journal of Business Research, Elsevier, vol. 66(12), pages 2657-2665.
    10. Gilles Grolleau & Naoufel Mzoughi & Sanja Pekovic, 2013. "Is Business Performance Related to the Adoption of Quality and Environmental-Related Standards?," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 54(4), pages 525-548, April.
    11. Wu, Guo-Ciang & Ding, Jyh-Hong & Chen, Ping-Shun, 2012. "The effects of GSCM drivers and institutional pressures on GSCM practices in Taiwan’s textile and apparel industry," International Journal of Production Economics, Elsevier, vol. 135(2), pages 618-636.
    12. Cody Jones, 2013. "Moving Beyond Profit: Expanding Research to Better Understand Business Environmental Management," Sustainability, MDPI, Open Access Journal, vol. 5(6), pages 2693-2721, June.
    13. Golini, Ruggero & Longoni, Annachiara & Cagliano, Raffaella, 2014. "Developing sustainability in global manufacturing networks: The role of site competence on sustainability performance," International Journal of Production Economics, Elsevier, vol. 147(PB), pages 448-459.
    14. Delmas, Magali A. & Grant, Laura E., 2008. "Eco-Labeling Strategies: The Eco-Premium Puzzle In The Wine Industry," Working Papers 37325, American Association of Wine Economists.
    15. Javier Aguilera-Caracuel & Juan Aragón-Correa & Nuria Hurtado-Torres & Alan Rugman, 2012. "The Effects of Institutional Distance and Headquarters’ Financial Performance on the Generation of Environmental Standards in Multinational Companies," Journal of Business Ethics, Springer, vol. 105(4), pages 461-474, February.
    16. Fujii, Hidemichi & Iwata, Kazuyuki & Kaneko, Shinji & Managi, Shunsuke, 2012. "Corporate environmental and economic performances of Japanese manufacturing firms: Empirical study for sustainable development," MPRA Paper 39564, University Library of Munich, Germany.

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