Geographic variations in the early diffusion of corporate voluntary standards: comparing ISO 14001 and the Global Compact

Despite their availability to firms across the world, uptake of global voluntary standards has proceeded unevenly across countries over time. In this paper we seek to provide new insights into how geography shapes these spatiotemporal variations, focusing on two leading examples of codified voluntarism: ISO 14001 and the Global Compact (GC). In an advance on previous quantitative studies, which have analyzed domestic and nondomestic influences separately, we examine how the internal attributes of place ‘condition’ the influence of transnational spatial dependencies. We find that higher levels of ISO 14001 certification in other economies are more likely to spill over (via transnational linkages) into higher domestic uptake of the standard in wealthier economies, while domestic receptivity to the influence of higher GC adoptions abroad is greater in more democratic countries. Another important advance on previous studies is that we examine the influence of a larger number of measures of transnational economic linkage. Providing evidence of ‘trading-up’ and ‘investing-up’ dynamics, we show that higher densities of ISO 14001 certificates and GC participants in a country’s export and inward foreign direct investment partners are associated with higher levels of domestic uptake of the respective standard. We also find tentative evidence of ‘visiting-up’ dynamics associated with the cross-border movement of businesspeople.