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Exploring the Direction on the Environmental and Business Performance Relationship at the Firm Level. Lessons from a Literature Review

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  • Anna Mazzi

    () (Department of Industrial Engineering, University of Padova, Via Marzolo 9, 35131 Padova, Italy)

  • Sara Toniolo

    () (Department of Industrial Engineering, University of Padova, Via Marzolo 9, 35131 Padova, Italy)

  • Alessandro Manzardo

    () (Department of Industrial Engineering, University of Padova, Via Marzolo 9, 35131 Padova, Italy)

  • Jingzheng Ren

    () (Department of Technology and Innovation, University of Southern Denmark, Campusvej 55, 5230 Odense M, Denmark)

  • Antonio Scipioni

    () (Department of Industrial Engineering, University of Padova, Via Marzolo 9, 35131 Padova, Italy)

Abstract

The interest of scientists and companies in understanding the business implications of environmental investment is timely; however, a dilemma remains at the firm level: is the environment a “strategic competitive factor”, as in the “Porter point of view”, or is it a “luxury good”, as in the “Wagner point of view”? Our research contributes to this debate through a review of the papers published in scientific journals between 2000 and 2015 that discussed the direction of the relationship between the environmental and business performances of enterprises. The objectives of the research are: (a) to verify if there is an agreement in the scientific literature of the last 15 years about the “Porter–Wagner dilemma” when focusing at the firm level; (b) to underline the prevalent cause and effect directions of the relationship between environmental and business performance; and (c) to investigate the reasons for any disagreements in this topic among the scientists. The results show that the main agreement regards the positive bi-directional relationship, as a virtuous cyclic approach with mutual effects between business and environmental performance; nevertheless, more complex hypotheses emerge, such as nonlinear and/or conditional relationship, that need to be further explored. On the other hand, the Porter–Wagner dilemma remains, and the main reason for the non-agreement among scientists can be due to the several non-homogeneous variables considered in the analyses. Thereafter, as lesson for scientists, the priority is to share univocal methods to measure firms’ environmental and business performances.

Suggested Citation

  • Anna Mazzi & Sara Toniolo & Alessandro Manzardo & Jingzheng Ren & Antonio Scipioni, 2016. "Exploring the Direction on the Environmental and Business Performance Relationship at the Firm Level. Lessons from a Literature Review," Sustainability, MDPI, Open Access Journal, vol. 8(11), pages 1-25, November.
  • Handle: RePEc:gam:jsusta:v:8:y:2016:i:11:p:1200-:d:83301
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    References listed on IDEAS

    as
    1. Salzmann, Oliver & Ionescu-somers, Aileen & Steger, Ulrich, 2005. "The Business Case for Corporate Sustainability:: Literature Review and Research Options," European Management Journal, Elsevier, vol. 23(1), pages 27-36, February.
    2. Wagner, Marcus, 2007. "On the relationship between environmental management, environmental innovation and patenting: Evidence from German manufacturing firms," Research Policy, Elsevier, vol. 36(10), pages 1587-1602, December.
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    5. Orlitzky, Marc, 2011. "Institutional Logics in the Study of Organizations: The Social Construction of the Relationship between Corporate Social and Financial Performance," Business Ethics Quarterly, Cambridge University Press, vol. 21(03), pages 409-444, July.
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    8. Neuteleers, Stijn & Engelen, Bart, 2015. "Talking money: How market-based valuation can undermine environmental protection," Ecological Economics, Elsevier, vol. 117(C), pages 253-260.
    9. Eugen Nicolăescu & Cristina Alpopi & Constantin Zaharia, 2015. "Measuring Corporate Sustainability Performance," Sustainability, MDPI, Open Access Journal, vol. 7(1), pages 1-15, January.
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    More about this item

    Keywords

    business performance; enterprises; environmental performance; literature review; Porter–Wagner dilemma;

    JEL classification:

    • Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics
    • Q0 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General
    • Q2 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation
    • Q3 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation
    • Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products

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