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Institutional Environment, Managerial Attitudes and Environmental Sustainability Orientation of Small Firms

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  • Banjo Roxas

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  • Alan Coetzer

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Abstract

This study examines the direct impact of three dimensions of the institutional environment on managerial attitudes toward the natural environment and the direct influence of the latter on the environmental sustainability orientation (ESO) of small firms. We contend that when the institutional environment is perceived by owner–managers as supportive of sound natural environment management practices, they are more likely to develop a positive attitude toward natural environment issues and concerns. Such owner–manager attitudes are likely to lead to a positive and proactive orientation of their firms toward environmental sustainability. The study uses survey data from 166 small manufacturing firms located in three Philippine cities. First, the study develops and tests the measurement models to examine the validity of the constructs representing the firm’s institutional environment, managerial attitudes toward the natural environment and the ESO of firms. Second, the study develops and tests the structural models examining the institutional environment–managerial attitudes–ESO linkages. Multi-sample invariance structural model analysis shows the mediating role of managerial attitudes in the institutional environment–ESO nexus. The findings show that ESO is a construct comprising three dimensions: knowledge of environmental issues, sustainable practices and commitment toward environmental sustainability. The cognitive, regulatory and normative elements of the institutional environment are strongly linked to positive managerial attitudes toward environmental sustainability, which in turn, positively influences the firm’s overall ESO. Managerial attitudes play a mediating role in the institutional environment–ESO linkages. The managerial, practical, research and policy implications of the research findings are discussed. Copyright Springer Science+Business Media B.V. 2012

Suggested Citation

  • Banjo Roxas & Alan Coetzer, 2012. "Institutional Environment, Managerial Attitudes and Environmental Sustainability Orientation of Small Firms," Journal of Business Ethics, Springer, vol. 111(4), pages 461-476, December.
  • Handle: RePEc:kap:jbuset:v:111:y:2012:i:4:p:461-476
    DOI: 10.1007/s10551-012-1211-z
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    References listed on IDEAS

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    1. repec:gam:jsusta:v:10:y:2018:i:3:p:641-:d:133963 is not listed on IDEAS
    2. S. Weaver & Pam Ellen & Lars Mathiassen, 2015. "Contextualist Inquiry into Organizational Citizenship: Promoting Recycling Across Heterogeneous Organizational Actors," Journal of Business Ethics, Springer, vol. 129(2), pages 413-428, June.
    3. Javier Martínez-del-Río & José Céspedes-Lorente, 2014. "Competitiveness and Legitimation: The Logic of Companies going Green in Geographical Clusters," Journal of Business Ethics, Springer, vol. 120(1), pages 131-146, March.
    4. repec:kap:jbuset:v:144:y:2017:i:3:d:10.1007_s10551-015-2826-7 is not listed on IDEAS
    5. Mariadoss, Babu John & Chi, Ting & Tansuhaj, Patriya & Pomirleanu, Nadia, 2016. "Influences of Firm Orientations on Sustainable Supply Chain Management," Journal of Business Research, Elsevier, vol. 69(9), pages 3406-3414.
    6. repec:gam:jsusta:v:9:y:2017:i:9:p:1667-:d:112402 is not listed on IDEAS
    7. Julie Dekker & Tim Hasso, 2016. "Environmental Performance Focus in Private Family Firms: The Role of Social Embeddedness," Journal of Business Ethics, Springer, vol. 136(2), pages 293-309, June.
    8. James Weber, 2015. "Identifying and Assessing Managerial Value Orientations: A Cross-Generational Replication Study of Key Organizational Decision-Makers’ Values," Journal of Business Ethics, Springer, vol. 132(3), pages 493-504, December.
    9. repec:kap:jbuset:v:143:y:2017:i:1:d:10.1007_s10551-015-2760-8 is not listed on IDEAS
    10. Clay Dibrell & Justin Craig & Jaemin Kim & Aaron Johnson, 2015. "Establishing How Natural Environmental Competency, Organizational Social Consciousness, and Innovativeness Relate," Journal of Business Ethics, Springer, vol. 127(3), pages 591-605, March.
    11. Ricky Y. K. Chan & Katherine H. Y. Ma, 2016. "Environmental Orientation of Exporting SMEs from an Emerging Economy: Its Antecedents and Consequences," Management International Review, Springer, vol. 56(5), pages 597-632, October.
    12. repec:gam:jsusta:v:9:y:2017:i:10:p:1899-:d:115917 is not listed on IDEAS
    13. Taiwen Feng & Dan Wang, 2016. "The Influence of Environmental Management Systems on Financial Performance: A Moderated-Mediation Analysis," Journal of Business Ethics, Springer, vol. 135(2), pages 265-278, May.

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