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'Too-much-of-a-good-thing'? The role of advanced eco-learning and contingency factors on the relationship between corporate environmental and financial performance

Author

Listed:
  • Hengky Latan
  • Charbel Jose Chiappetta Jabbour

    (MRM - Montpellier Research in Management - UPVM - Université Paul-Valéry - Montpellier 3 - UPVD - Université de Perpignan Via Domitia - Groupe Sup de Co Montpellier (GSCM) - Montpellier Business School - UM - Université de Montpellier, University of Stirling)

  • Ana Beatriz Lopes De Sousa Jabbour

    (Groupe Sup de Co Montpellier (GSCM) - Montpellier Business School)

  • Douglas William Scott Renwick
  • Samuel Fosso Wamba

    (TBS - Toulouse Business School)

  • Muhammad Shahbaz

    (MRM - Montpellier Research in Management - UPVM - Université Paul-Valéry - Montpellier 3 - UPVD - Université de Perpignan Via Domitia - Groupe Sup de Co Montpellier (GSCM) - Montpellier Business School - UM - Université de Montpellier)

Abstract

Inspired by the natural-resource-based view (NRBV) theory, we attempt to shed light on a controversy which has been persistent over the last decade, concerning the relationship between corporate environmental performance (CEP) and corporate financial performance (CFP). Using the 'too-much-of-a-good-thing' (TMGT) concept, which suggests that "too much can be worse than too little," we link mixed results and consider the roles of advanced eco-learning and contingency factors in influencing the CEP-CFP relationship. Based on a sample composed of ISO 14001 certified companies in Indonesia, and analyzing the data using consistent Partial Least Squares (PLSc), we found that: the CEP-CFP relationship follows an inverted U-shape; advanced eco-learning is a significant predictor of the CEP-CFP relationship, meaning that organizations able to develop higher eco-learning capability will be better able to identify the ideal boundaries of investment in environmental performance without reducing their financial performance; and that contingency factors such as environmental strategy and firm size have a significant role in influencing the CEP-CFP relationship. The study's limitations, implications for practitioners and a future research agenda are also detailed.

Suggested Citation

  • Hengky Latan & Charbel Jose Chiappetta Jabbour & Ana Beatriz Lopes De Sousa Jabbour & Douglas William Scott Renwick & Samuel Fosso Wamba & Muhammad Shahbaz, 2018. "'Too-much-of-a-good-thing'? The role of advanced eco-learning and contingency factors on the relationship between corporate environmental and financial performance," Post-Print hal-04275093, HAL.
    • Handle: RePEc:hal:journl:hal-04275093
    DOI: 10.1016/j.jenvman.2018.05.012
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    Cited by:

    1. Gianluca Biggi & Andrea Mina & Federico Tamagni, 2023. "There are different shades of green: heterogeneous environmental innovations and their effects on firm performance," Papers 2310.08353, arXiv.org.

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