Corporate governance & the environment: bad discretion, good discretion, and environmental (...)
This paper brings two important topics of corporate environmental management and corporate governance by exploring the impact of various governance mechanisms on the level of environmental performance that is realized by firms. We hypothesize that anti-takeover amendments and provisions that restrict managersÂ´ personal liability create a sphere of "bad" discretion that allows managers to shirk by underinvesting in potentially financially beneficial levels of environmental performance. We suggest that corporate governance structures that emphasize higher levels of performance pay and lower degrees of monitoring create a degree of "good" discretion that enhances environmental firm performance.
|Date of creation:||Jun 2005|
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"Takeover Threats and Managerial Myopia,"
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- Lanoie, Paul & Laplante, Benoit & Roy, Maite, 1998. "Can capital markets create incentives for pollution control?," Ecological Economics, Elsevier, vol. 26(1), pages 31-41, July.
- Aragon-Correa, Juan Alberto & Matias-Reche, Fernando & Senise-Barrio, Maria Eugenia, 2004. "Managerial discretion and corporate commitment to the natural environment," Journal of Business Research, Elsevier, vol. 57(9), pages 964-975, September.
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- Gerald T. Garvey & Gordon Hanka, 1999. "Capital Structure and Corporate Control: The Effect of Antitakeover Statutes on Firm Leverage," Journal of Finance, American Finance Association, vol. 54(2), pages 519-546, April. Full references (including those not matched with items on IDEAS)
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