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Do formal and informal institutions matter for firm-level strategic environmental actions? A multi-level perspective from Jordan

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  • Yousef H. Eiadat
  • Alejandro M. Fernández-Castro

Abstract

We developed an overarching multi-level mediation model using 199 responses from 53 companies from the industrial sector in Jordan to examine (1) the mediation effect of firm-level environmental climate on the relationship between formal regulatory institutions and firm-level strategic environmental actions, and (2) the role that informal institutions conveyed via political, normative, and business connections plays on the environment-related cognitions of top managers. At the ‘within’ level, our results indicate that top managers with strong political connections develop negative environment-related cognitions while those with strong normative and business connections develop positive environment-related cognitions. At the firm-level, our results reveal that firm-level environmental climate – as an aggregated measure of the ‘within’ level environmental cognitions of top managers – fully mediates the relationship between formal regulatory institutions and firm-level strategic environmental actions. This study demonstrates how multilevel research is used to enrich understanding of firm-level strategic environmental actions, with implications beyond Jordan.

Suggested Citation

  • Yousef H. Eiadat & Alejandro M. Fernández-Castro, 2022. "Do formal and informal institutions matter for firm-level strategic environmental actions? A multi-level perspective from Jordan," Journal of Environmental Planning and Management, Taylor & Francis Journals, vol. 65(3), pages 461-489, January.
    • Handle: RePEc:taf:jenpmg:v:65:y:2022:i:3:p:461-489
    DOI: 10.1080/09640568.2021.1887826
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