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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.

Suggested Citation

  • Pinkse, Jonatan & Kuss, Matthias J. & Hoffmann, Volker H., 2010. "On the implementation of a 'global' environmental strategy: The role of absorptive capacity," International Business Review, Elsevier, vol. 19(2), pages 160-177, April.
  • Handle: RePEc:eee:iburev:v:19:y:2010:i:2:p:160-177
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    References listed on IDEAS

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    1. repec:eee:iburev:v:26:y:2017:i:6:p:1075-1087 is not listed on IDEAS
    2. Christopher Wickert & Andreas Georg Scherer & Laura J. Spence, 2016. "Walking and Talking Corporate Social Responsibility: Implications of Firm Size and Organizational Cost," Journal of Management Studies, Wiley Blackwell, vol. 53(7), pages 1169-1196, November.
    3. Olsthoorn, Mark & Schleich, Joachim & Hirzel, Simon, 2017. "Adoption of Energy Efficiency Measures for Non-residential Buildings: Technological and Organizational Heterogeneity in the Trade, Commerce and Services Sector," Ecological Economics, Elsevier, vol. 136(C), pages 240-254.
    4. 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.
    5. repec:eee:touman:v:50:y:2015:i:c:p:268-280 is not listed on IDEAS
    6. repec:eee:touman:v:46:y:2015:i:c:p:30-42 is not listed on IDEAS
    7. repec:eee:worbus:v:52:y:2017:i:5:p:591-614 is not listed on IDEAS
    8. 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.
    9. 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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