Managerial perceptions of corporate environmentalism: interpretations from industry and strategic implications for organizations

Environmental issues are becoming increasingly important in organization theory and practice. Corporate environmentalism is emerging as a process of addressing environmental issues facing business firms. In this paper I examine managerial perceptions of corporate environmentalism and describes how key organizational members interpret the relationship between their firm and the biophysical environment. Corporate environmental orientation and environmental strategy focus are two themes of corporate environmentalism that emerge from the study. I discuss managerial perceptions of regulatory forces, public environmental concern, top management commitment and need for competitive advantage, and how perceptions of these factors might translate into environmental strategies. I conclude by discussing implications of corporate environmentalism for organizational theory and practice.     

Linking strategy and human resource practices: How employee and customer contracts are created

Organizations implement their business strategies through the human resource (HR) practices they use. These practices are major determinants of employees' psychological contracts. How employees interpret the terms of their employment impacts motivation, innovation, and customer service. This article describes four common types of psychological contracts in US firms and the HR practices that create them. It develops a framework for understanding how each contract shapes employee performance, retention, cooperation with fellow employees and customer responsiveness. It presents recommendations for more effectively managing the link between business strategy and the psychological contract of employees. © 1994 by John Wiley & Sons, Inc.     

Managing the duality of IHRM: unravelling the strategy and perceptions of key actors in South Korean MNCs

This research aims to extend our understanding of the duality between global integration and local responsiveness in multinational corporations (MNCs) by exploring the perceptions of corporate HR actors regarding the intra-organisational factors that alter the balance between these pressures. It examines the perceptions and actions of key actors in the context of two Korean MNCs. The study shows the importance attributed to a range of socio-procedural factors by corporate actors and which, therefore, inform the practical management of the dual forces, notably: HR expertise, social ties, trustworthy relationships and co-involvement in decision processes.     

An analytical approach for making management decisions concerning corporate restructuring

Internal corporate restructuring activities, such as downsizing, sale or termination of a business line, facility closure, consolidation, or relocation, often occur as part of managerial strategies intended to improve efficiency, control costs, and adapt to an ever‐changing business environment. Such actions frequently result in fundamental changes in a business's organization, its strategies, its systems, and its operations. They can unsettle a business and often significantly affect current and future earnings and cash flows. In this paper we propose a novel decision‐making model through the use of the dynamic programming technique to illustrate how management can determine the optimal timing and appropriate restructuring actions that maximize the benefits of a restructuring program. Copyright © 2006 John Wiley & Sons, Ltd.     

Assessing the impact of green supply chain practices on firm performance in the Korean manufacturing industry

As a growing number of customers tend to view corporate social responsibility (CSR) as a key purchase decision criterion, demands for CSR including environmental sustainability have accelerated in today's business world. To meet such demands, many firms consider embracing environment-friendly business practices. However, many firms are still hesitant to implement those practices due to sceptical views about their real managerial benefits. Although the previous literature confirms the positive link between a firm's commitment to environmental sustainability and its performance, the varying degree of impact of different kinds of environment-friendly supply chain practices on the firm's operational performance is still unknown. To fill the void left by prior research, this paper aims to classify various types of green supply chain management (GSCM) practices and then assess the impact of each of these distinct types on the firm's operational performances (especially manufacturing and marketing performance). Also, this paper examines how the firm's organisational profiles such as firm size affect the particular firm's choice of GSCM practices. Our experimental results reveal that the chosen type of GSCM practices influences the firm's performance differently.     

Greenwashing and environmental communication: Effects on stakeholders' perceptions

Since the first Earth Day in the 1970s, corporate environmental performance has increased dramatically, and cases of greenwashing have increased sharply. The term greenwash refers to a variety of different misleading communications that aim to form overly positive beliefs among stakeholders about a company's environmental practices. The growing number of corporate social responsibility claims, whether founded or not, creates difficulties for stakeholders in distinguishing between truly positive business performance and companies that only appear to embrace a model of sustainable development. In this context, through the lens of legitimacy and signalling theory, we intend to understand and assess the different influences that various types of misleading communications about environmental issues have on stakeholders' perceptions of corporate environmental responsibility and greenwashing. Stakeholder responses to an environmental scandal will also be assessed. The hypotheses tested through a four‐for‐two design experiment reveal that different levels of greenwashing have a significantly different influence on stakeholders' perceptions of corporate environmental responsibility and stakeholders' reactions to environmental scandals.     

Electoral system,corporate political donation,and carbon emission intensity: Cross-country evidence

We examine the association between a country's electoral system and greenhouse gas (GHG) emission intensity of firms and explore whether this association is influenced by corporate political donation. The study draws on the neo-pluralist theory of power in society to examine how possible corporate influence in the electoral systems relates to corporate environmental performance. Using a cross-country panel dataset, we find that companies operating in countries using majoritarian electoral systems (MAJ), where corporations have a relatively low influence on election outcomes, are associated with lower GHG emission intensity than those in proportional electoral systems, after controlling for macro-economic factors and variations in firm characteristics. Further, our findings show that corporate political donation positively moderates the association between MAJ and GHG emission intensity. Our results suggest that corporations are likely to utilise political donations as a component of business strategy to ease the regulatory actions of the state on companies. The results are robust to alternative variable measurements and tests of sensitivity.     

Ties that blind? How strong ties affect small business owner-managers’ perceived trustworthiness of their advisors

This research investigates how a strong personal relationship (strong tie) between a small business owner-manager and his professional or informal advisor affects the relationship between the advisor's recent performance and the owner-manager's perceptions of the advisor's trustworthiness in terms of ability, benevolence and integrity. A negative moderating effect could point to a ‘tie that blinds’: the owner-manager may be less critical in evaluating the advisor's perceived trustworthiness in light of their recent performance, because of the existing personal relationship. A conceptual model is constructed and examined with survey data comprising 153 young Finnish businesses. The results show that strong ties increase the owner-manager's perception of the advisor's integrity, disregarding their recent performance. For professional advisors, strong ties reduce the impact of recent performance in the owner-manager's evaluation of their ability. For informal advisors, a strong tie makes it more likely that their benevolence will be evaluated highly in light of their recent performance. While the results show that ‘ties can blind’ under certain circumstances, the limitations of the study raise the need for further research to specify these contextual factors and examine the causal link between the choice of advisor and business performance.     

Being ‘Green and Competitive’: The Impact of Environmental Actions and Collaborations on Firm Performance

In this paper, we seek to enhance the understanding of the link between environmental management and firm performance, so contributing to the debate of being “green and competitive”. Relying on the resource‐based view, we study the effect of different environmental management capabilities on a firm's market and image performance. In particular, we analyze the capabilities to implement product and process‐related environmental actions with different types of environmental focus (materials, energy, pollution) and the capabilities to develop environmental collaborations with different types of actors (both business actors and non‐business actors). To this aim we conducted a survey on 122 Italian companies. Results show that market performance and image performance have partially different antecedents. Specifically, a firm's market performance is positively affected by the capabilities to implement environmental actions with a focus on energy and pollution and to develop environmental collaborations both with business and with non‐business actors. On the other hand, a firm's image performance is positively affected by the capabilities to implement environmental actions with a focus on materials and to develop environmental collaborations with non‐business actors. Copyright © 2013 John Wiley & Sons, Ltd and ERP Environment     

When do high‐level managers believe they can influence the stock price? Antecedents of stock price expectancy cognitions

Stock based rewards are often used to motivate high‐level managers to take actions to increase the stock price of the firm. However, numerous constraints may weaken the perceived link between individual effort and stock price appreciation for many recipients. This study introduces a new construct, stock price expectancy, which we define as individuals' perceptions of influence over their firm's stock price. We examined its antecedents in a sample of 349 high‐level U.S. managers and found that employment at corporate headquarters, firm size, hierarchical level, and contact with investment analysts predicted stock price expectancy perceptions. © 2010 Wiley Periodicals, Inc.     

When do corporate social responsibility initiatives impact on customer-facing employees? Evidence from India and the Netherlands

The vast majority of the extant literature on corporate social responsibility (CSR) has focused on the macro (firm) level of analysis by examining the linkage between CSR and firm-level outcomes. As such, very few studies have focused on the micro (individual) level of analysis. Against this backdrop, the present study focuses on the individual level of analysis thereby contributing to the emerging psychology of CSR literature, which considers employees' perceptions of their employing organizations' social actions as more important than organizations' objective CSR performance (Rupp, Shao, Thornton and Skarlicki (2013), ‘Applicants’ and Employees’ Reactions to Corporate Social Responsibility: The Moderating Effects of First-Party Justice Perceptions and Moral Identity,’ Personnel Psychology, 66, 895–933). Moreover, the study is one of the first examining the role of context in employee attitudes toward CSR. In particular, it builds on the psychology of CSR (e.g. Rupp et al. 2013) literature to propose a research framework that delineates the moderating effects of satisfaction with payment, satisfaction with the job itself and individualism in the relationship between corporate social performance (CSP) perceptions and customer-facing employees' behavioral outcomes. Data are collected from customer-facing employees in two major organizations in the Netherlands and India. Results suggest a complex interplay between CSP perceptions and the two facets of job satisfaction, and that national context is likely to moderate the contingent effects of CSP perceptions on customer-facing employees' behavioral outcomes.     

Behavioral Effects of Sustainability‐Oriented Incentive Systems

Companies increasingly extend their existing incentive systems by integrating several sustainable performance indicators. Although these ‘sustainability‐oriented’ incentive systems clearly highlight which business objectives should be attained, little is known about the effects that these incentive systems have on employee behavior. Based on signaling theory, social identity theory and a person–organization fit (PO‐fit) perspective, we assume positive relations between sustainability‐oriented incentive systems and employee attraction, motivation and cooperation. Furthermore, we examine whether these relations are moderated by personal attitudes toward corporate sustainability activities as well as the underlying mechanisms at the moderation (mediated moderation). Our experimental results (with students as future employees) do not give support for a general positive relation between sustainability‐oriented incentive systems and employee behavior. However, our data show that a person's attitude toward corporate sustainability activities moderates the link between sustainability‐oriented incentive systems and employee behavior. Additionally, we find PO‐fit perceptions to mediate the interaction effects. Copyright © 2015 John Wiley & Sons, Ltd and ERP Environment     

Paving the road toward eco-effectiveness: Exploring the link between greenhouse gas emissions and firm performance

Climate change has increasingly attracted business attention over the last decade, focusing particularly on the eco-efficiency debate. The goal of this paper is twofold. First, we contribute to the ongoing debate on the effects of environmental strategies on firm performance. We investigate this relationship by considering the relative greenhouse gas emissions (GHG) as a predictor of the eco-efficiency of firms' environmental strategies. GHG emissions are a direct indicator of the environmental performance and effectively measure the firm's efforts in mitigating the impacts related to its processes and products. Second, we investigate the drivers that lead to an increase in the firm's environmental impact under the conditions of increasing market performance by the firm, therefore paving the road to the concept of eco-effectiveness of corporate environmental strategies. To test our hypotheses, we use a sample of worldwide listed companies derived from the S&P 1200 list. A longitudinal analysis is run through generalized least squares regression models over the period 2004–2016. Results offer evidence of the direct relationship between the level of absolute emissions and market performance of the firm. Therefore, the findings have significant implications on the way we conceptualize corporate environmental sustainability and environmental strategies, shedding new light on the relation between environmental pressures and corporate growth.     

Corporate commitment to climate change action,carbon risk exposure,and a firm's debt financing policy

Motivated by the rising consensus that corporate engagement in climate change actions holds the key for society's transition into environmentally resilient economy, the study examines whether a firm's commitment to climate change action and its carbon risk exposure shape the firm's debt financing policy. Based on insights drawn from signaling, corporate reputation, and agency theories, we develop models that link corporate commitment to climate change actions and a firm's carbon risk exposure with its debt financing decisions. Using data drawn from S&P 500 companies, for years 2015 to 2019, we find a robust evidence that firms that engage in higher levels of commitment to climate change actions issue a higher proportion of debt with longer terms to maturity, even after controlling for their carbon risk exposure. However, we do not find a robust evidence corroborating an association between firms' carbon risk exposure and their debt financing policy. These findings are consistent with arguments that high-commitment firms enjoy positive reputation, better credit rating, and reduced agency and information asymmetry costs, allowing them to gain easier access to long-term debt markets.     

Integrated Thinking and the Transparency of Tax Disclosures in the Corporate Reports of Firms

The purpose of our study was to link two global corporate developments, namely integrated thinking and the transparency of tax disclosures. The International Integrated Reporting Council's long‐term vision is for integrated thinking to be embedded in mainstream business practice, facilitated by integrated reporting. The development of the transparency of tax disclosures was driven by tax avoidance practices of multinational companies. The vision of embedding integrated thinking into mainstream business and the increased focus on the transparency of tax disclosures have developed independently, but thus far there has been no serious consideration of how they may be related. We argue that there is a natural relationship between these two developments. We use PwC's (2014) framework for measuring the transparency of tax disclosures and apply the framework to the corporate reports of a sample of 45 large firms. We use regression analysis to test the association between the transparency of tax disclosures in corporate reports and integrated thinking and find them to be positively associated.     

Identifying Worldviews on Corporate Sustainability: A Content Analysis of Corporate Sustainability Reports

Companies commonly issue sustainability or corporate social responsibility (CSR) reports. This study seeks to understand worldviews of corporate sustainability, or the corporate message conveyed regarding what sustainability or CSR is and how to enact it. Content analysis of corporate sustainability reports is used to position each company report within stages of corporate sustainability. Results reveal that there are multiple coexisting worldviews of corporate sustainability, but the most dominant worldview is focused on the business case for sustainability, a position anchored in the weak sustainability paradigm. We contend that the business case and weak sustainability advanced in corporate sustainability reports and by the Global Reporting Initiative are poor representations of sustainability. Ecological embeddedness, or a locally responsive strategy that is sensitive to local ecosystems, may hold the key to improved ecological sensemaking, which in turn could lead to more mature levels of corporate sustainability worldviews that support strong sustainability and are rooted in environmental science. This must be supported by government regulation. Copyright © 2017 John Wiley & Sons, Ltd and ERP Environment     

Integrating Sustainability into Firms' Processes: Performance Effects and the Moderating Role of Business Models and Innovation

Innovation has been widely regarded as a panacea for sustainable development, but there remains considerable uncertainty about how it will lead to a more sustainable society. We analyze the role of innovation and business models for the link between the integration of sustainable management with other corporate functions and the economic and environmental performance of companies. Drawing on survey data in the manufacturing sector, we apply structural equation modeling to compare differences between business models and the role of different stakeholder groups in a moderation analysis. We find a positive association of the integration of strategic issues and environmental management with the economic and environmental performance of firms. The results also suggest differences in the link between integration and economic and environmental performance, respectively, depending on the type of business model or innovation pursued, and that secondary stakeholders influence sustainability integration. Copyright © 2011 John Wiley & Sons, Ltd and ERP Environment.     

CEO Succession Mechanisms,Organizational Context,and Performance: A Socio‐Emotional Wealth Perspective on Family‐Controlled Firms

This article extends the literature on CEO succession and financial performance by addressing corporate owners' mixed motives and desires to protect their interest in being in business. We draw on a Socio‐Emotional Wealth (SEW) perspective to investigate how the choice of one of three succession mechanisms – relay succession, ‘horse races’ among internal CEO candidates, and hiring from outside – may effectively balance trade‐offs between corporate owners' non‐financial SEW motives and the firm's financial performance. We find that implementing one of these succession mechanisms reduces the negative impact that typically characterizes CEO transitions in family firms. We also show that family presence on the board of directors offsets the benefits of having selected these balancing succession mechanisms, in either placing too much emphasis on SEW, or creating negative dynamics that make the chosen succession mechanisms less effective.     

Payments for ecosystem services and corporate social responsibility: Perspectives on sustainable production,stakeholder relations,and philanthropy in Thailand

Payments for ecosystem services (PES) are environmental management tools that enable corporations to simultaneously enhance their environmental performance and fund sustainable development in rural areas. PES is primarily promoted as part of a sustainable production strategy for conserving natural resources, offsetting carbon emissions, and green supply chain management. Nevertheless, PES uptake by the private sector remains low, and few studies have analysed whether corporate‐financed PES schemes conform to this rationale. This study evaluates three of the first PES schemes in Thailand, financed by large corporations in the water utilities, aquaculture, and beverage sectors. Interviews with 39 business managers and project stakeholders suggest that PES may be viewed as a tool for philanthropy, public relations, and gaining license to operate—akin to many corporate social responsibility initiatives. Explanations and ramifications are discussed in the context of ecological uncertainty, risk management, financial performance, organisational learning, and the corporate‐engagement strategies of non‐governmental organisations.