The ‘win–win’ paradigm and stakeholder integration

Firms are under pressure to invest in environmental management systems (EMSs) to reduce the environmental impacts of their activities. Many advocates of EMS adoption promote the idea of ‘win–win’ gains, where improvements in environmental performance are accompanied by financial rewards. The empirical evidence on this is mixed and suggests that the' right' conditions must exist within the firm for genuine environmental performance gains to materialize. The paper uses a survey of 129 Spanish manufacturing firms to investigate managerial perceptions about what these right conditions might be. Results indicate that enhanced environmental performance following EMS adoption is linked to managers' belief in the win–win paradigm, and that managers who adhere to the win–win story also tend to integrate other stakeholder demands into their business strategies. Policy implications conclude the paper. Copyright © 2007 John Wiley & Sons, Ltd and ERP Environment.     

Small businesses and the environment: turning over a new leaf?

Previous studies on the environmental practices of small and medium‐sized enterprises (SMEs) in the UK and beyond have portrayed owner‐managers as laggards who underplay their firm's environmental impacts and resist environmental management due to its perceived cost. Yet a recent cross‐sector survey of 220 UK SMEs suggests that this intransigent stance may be slowly changing. Responses indicate a high percentage of owner‐managers actively involved in recycling, energy efficiency, responsible buying and selling, and efforts to reduce their carbon emissions. Owner‐managers saw it as their responsibility to help solve environmental problems and were reportedly willing to accept the costs of tougher environmental regulations and taxation. Business owners were motivated not just by the ‘push’ of legislation and environmental concern but by the ‘pull’ of potential cost savings, new customers, higher staff retention and good publicity for their firms. The survey also found that owner‐managers had resonance with the Stern Review's (2006) conclusions that the benefits of strong early action on climate change outweigh the costs, and that a transition to a low‐carbon economy will bring opportunities for business growth. This indicates that SMEs may be coming round to the idea that there is a business case for sustainability, although there is still some scepticism on the overall profitability of environmental action. Copyright © 2009 John Wiley & Sons, Ltd and ERP Environment.     

The business case for sustainability? An examination of small firms in the UK's construction and restaurant sectors

Studies show that despite a concerted attempt by UK policy‐makers to portray ‘eco‐efficiency’ measures as cost reducing, most owner‐managers of small firms view environmental measures as expensive to undertake. As a result, owner‐managers tend to be highly resistant to voluntarily improving their environmental performance. Given that SMEs are such a vast sector of the economy, this perceived discord between profits and environmental protection is clearly a major barrier to the ‘greening’ of industry. This ESRC‐funded study has sought to unearth the underlying motivations for why SME owner‐managers in the UK resist or accept the idea that there are business benefits for improving their environmental performance. The findings from 40 in‐depth interviews with SME owners in the UK's construction and restaurant sectors and 12 ‘key informants’ from industry and government are presented, followed by a discussion of SME perspectives on the ‘business case’ for sustainability and its implications for policy‐makers. Copyright © 2005 John Wiley & Sons, Ltd and ERP Environment.     

The moderating effect of innovation on the relationship between environmental and financial performance: Evidence from high emitters in Australia

This study examines whether environmental-related innovation moderates the association between environmental and financial performance measured respectively as carbon emissions and return on assets (ROA). The sample comprises 119 companies subject to Australia's National Greenhouse Energy Reporting Act (NGER) for the period 2009–2017. The results show that environmental innovation positively moderates the relationship between environmental performance and financial performance. The findings also imply that the impact of environmental innovation in improving environmental performance is observable with a 1-year lag. The results are robust to the alternative financial performance measures of Tobin's Q and Altman's Z score. The findings have important implications for company managers and policymakers and provide useful information on innovation's role in enhancing environmental and financial performance.     

Values,gender and attitudes towards environmental policy: A study of future managers

This study explores if the value priorities and their impact on future managers' attitudes towards environmental responsibilities vary with gender. While relevant prior studies mostly focus on gender‐based variations of individuals' personal values in developed economies, we concentrate on both personal values and pro‐environmental attitudes in an emerging economy. This study is built on MBA students (a proxy for future managers) in India since India is characterized as a male‐dominated society and a producer of larger number of MBA graduates. Overall, our results show that personal values and attitude towards environmental responsibilities do not vary significantly with gender. Only two values (among the 21 values) and one value type (out of 10 values) get significantly higher ranking from females compared with males. Further, although ‘universalism’ and ‘benevolence’ are found to have a statistically significant impact on respondents' attitude towards environmental responsibility, the latter is invariant to the respondents' gender. Our findings may indicate India's transformation from a male‐dominated society towards a more gender‐balanced society. These findings can be used to operationalize a pro‐environmental recruitment policy and to formulate strategies to improve female participation in MBA cohorts of business schools.     

Sustainable Development and the Financial System: Society's Perceptions About Socially Responsible Investing

The debate surrounding the financial needs of investors and the impact on society of investment is considered to be an important research topic due to the growth of socially responsible financial markets. The main objective of this research is to study society's perception about socially responsible investing (SRI) and to identify investor's preferences regarding environmental, social and governance criteria, their real‐life investment needs and the most relevant sustainable financial products. To examine society's perception of SRI, we conducted a field survey among Spanish investors. The results show that SRI is at an early stage and Spanish investors need more exact information regarding social, environmental, and governance criteria in order to invest in socially responsible companies and products. This paper offers some guidelines that could be used by Spanish institutions, managers and investors and by foreign managers when approaching the Spanish market, in order to promote the growth of socially responsible financial products. Copyright © 2012 John Wiley & Sons, Ltd and ERP Environment.     

Does organisational capital influence environmental strategies? Evidence from environmental innovation

As a result of increasing consumer awareness and stakeholder demands about environmental management, firms face stricter challenges surrounding the impact of business operations on the environment. In this regards, environmental innovation is one of the important ways of acting in harmony with the environment. Thus, the purpose of this study is to examine the impact of organisational capital on environmental innovation measured as the process innovation and product innovation. Using environmental innovation data from ASSET4 for the US listed firms between 2002 and 2018, our empirical results reveal a significant positive association between organisational capital and both the process innovation and product innovation. Furthermore, the relationship is stronger in high-profitability and sensitive industries subsamples. These results are robust to additional control variables and endogeneity tests. This study, while endorsing the resource-based view (RBV), provides important implications for the top management teams that organisational capital could be an important channel through which managers can boost environmental innovation.     

Impact of Environmental Performance on Firm Value for Sustainable Investment: Evidence from Large US Firms

This research examines the impact of environmental performance on firm value, applying the event study methodology to Newsweek’s ‘Green Rankings’ announcement of 2012 for large US firms. Specifically, it analyzes the impact of the absolute green score and green rank of firms on their performance in the stock market. We found that investors perceive the announcement as positive news, leading to significant positive standardized cumulative abnormal returns (SCARs). After controlling for industry‐ and firm‐specific effects, we observed that firms with repeated green rankings for enhancing environmental performance showed significantly higher SCARs than those with either reduced or unchanged environmental performance. In addition, the environmental impact score measuring environmental damage from a firm's operational activities was found to be the most influential factor in improving the firm's value. Our findings are beneficial to managers in allocating resources to different types of environmental initiative, and provide valuable insight for sustainable environmental investment. Copyright © 2014 John Wiley & Sons, Ltd and ERP Environment     

Using a competency approach to understand host-country national managers in Asia

This study empirically explored host-country nationals (HCNs) in multinational enterprises (MNEs) using a competency approach. Participants consisted of 500 managers working for a leading Japanese retail MNE, with 100 each from Japan, China, Hong Kong, Malaysia and Thailand. The study highlighted three competency variables for 12 skills of those managers: (1) the level of competency demands, (2) the level of developed competencies and (3) the level of competency improvement needs as assessed by the difference between the levels of developed competencies and the levels of corresponding competency demands. Three conclusions were drawn: First, relationship skills are the most demanded and developed competency of HCN managers in Asia, while their levels tend to vary with Asian countries. Second, goal-setting skills are also very important competency demands but are insufficiently developed by HCN managers. Therefore, HCN managers need to improve their goal-setting skills to a great degree as a top priority. Third, interpersonal and behavioral competency areas of the 12 skills are more important demands for HCN managers than analytical and perceptual competency areas. Based on the empirical evidence obtained from this study, theoretical and practical implications were discussed.     

Measuring the impact of sustainability policy and practices in tourism and hospitality industry

This paper aims to investigate the impact of environmental policy and training aspects on hotels' sustainability practices, as well as the impact of these practices on their environmental and financial performance. Based on survey data from 312 managers operating in tourism and hospitality industry, this study applies structural equation modelling. Empirical results reveal that hotels' environmental policy and training aspects are positively related to sustainability practices. Environmental communication has almost equal degree of impact on resource and energy conservation, whereas both resource conservation and energy conservation have a significant positive impact on both environmental and financial performance. The main findings of this research highlight that hotels are increasingly considering sustainability issues in their business models and strategies. These findings provide practical managerial implications for the development of tourism and hospitality industry in emerging countries.     

The Impact of Financial Reporting Regulation on the Market Valuation of Reported Environmental Liabilities: Preliminary Evidence from US and Canadian Public Companies

This study investigates the economic consequences of four financial reporting regulations relating to environmental liability reporting in samples of 170 US and 156 Canadian public companies during the period 1984 to 1997. The study's purpose is to investigate the factors that make financial reporting regulation effective in enhancing the relevance and reliability of accounting information. Prior research provides the theory that financial reporting regulations impose costs on managers and create incentives for them to report accounting information that is relevant and unbiased. This study assesses these regulations' enforceability, which is viewed as arising from the regulator's power to enforce its regulations by sanctions or penalties. It tests whether the relation between market valuation and reported environmental liability accruals changes when the new regulations are enacted, and whether regulation with high enforceability has a more significant impact than regulation with low enforceability. This study uses a residual‐income valuation model to measure the valuation coefficient, or multiplier, on reported environmental liability accruals. Changes in this coefficient are used as indicators of changes in the market's assessment of the value relevance and bias of the reported accounting information. This study provides preliminary evidence indicating that financial reporting regulations issued by the securities market regulator and the accounting profession are associated with changes in the relation between market value and reported environmental liabilities in some cases, and suggests avenues for further international accounting research on the factors involved in financial reporting regulation's impact.     

Can environmental governance lower toxic emissions? A panel study of U.S. high‐polluting industries

Firms have increasingly adopted environmental governance mechanisms in the form of environmental compensation and environmental board committees. The current study examines the argument that such environmental governance mechanisms contribute to lower toxic emissions in high‐polluting industries. The sample comprises firms that were part of the S&P 500 from the years 2006 to 2011 and were mandated to report toxic emissions to the U.S. Environmental Protection Agency under the Toxic Release Inventory program. A panel regression model with propensity score matching was employed to minimize endogeneity bias. The results indicate that environmental compensation is a compelling incentive to motivate managers to invest in long‐term and highly uncertain environmental projects. Likewise, the presence of an environmental board committee appears to be significant, suggesting that directors contribute to a firm's strategy with their expertise and political influence. This research also found evidence supporting the cumulative adoption of both environmental governance mechanisms in enhancing environmental performance and the firm's legitimacy.     

Investigating the link between managers' green knowledge and leadership style,and their firms' environmental performance: The mediation role of green creativity

Despite extensive literature on green hotel management and sustainability, scant attention has been given on the role of managers to solve environmental related issues. This study's aim is to assess the effects of managers' green knowledge and green transformational leadership on firms' environmental performance with the mediating effect of green creativity. The study analyzes the perceptions of 363 employees in different managerial positions of the hotel industry employing Partial Last Square Structural Equation Modeling. The findings of the study show a positive effect of green knowledge and green transformational leadership on green creativity and green transformational leadership on environmental performance. Furthermore, green creativity is also found to have significant mediating effect between green knowledge and environmental performance, and green transformational leadership and environmental performance relations. The main implication of the current research is that managers' green concerns might help the stakeholders in the hotel industry to respond through appropriate green initiatives for their organizations. Further suggestions for literature and practice are discussed.     

Relational capital,environmental knowledge integration,and environmental performance of small and medium enterprises in emerging markets

Although several prior studies have examined associations between firm social capital and environmental sustainability, the links between relational resources (i.e., relational capital and ties strength), environmental knowledge integration, and environmental performance have yet to be well established at the micro-level. This study, therefore, aims to determine (1) how environmental knowledge integration serves as a mediating mechanism for the relationship between relational capital and environmental performance and (2) how this impact differs at different levels of ties strength. A quantitative approach has been adopted to examine the main hypotheses using a structural equation model (SEM) technique. Two groups of actors were surveyed, including chief executive officers (CEOs) and financial officers of small and medium-sized enterprises (SMEs) operating in Dubai, United Arab Emirates. In total, 216 survey responses were gathered, suggesting a response rate of 73.22%. Our findings suggest that environmental knowledge integration is a vital mediating mechanism for the relationship between relational capital and SMEs' environmental performance. Also, we find that ties strength moderates the indirect effect of relational capital on SMEs' environmental performance via environmental knowledge integration. Our empirical evidence provides recommendations for SMEs' managers and policymakers to promote environmental sustainability in the emerging market context.     

Institutionalizing environmental performance in US industry: Is it happening and what if it does not?

A historical review of the ways business organizations in the United States have responded to demands that they improve their environmental performance reveals two clear outcomes: firms that effectively institutionalize improved environmental performance can garner significant strategic advantages for their efforts, and firms that do not often suffer severe legal consequences. Thus, institutionalization is a pivotal organizational process which determines whether a firm's environmental performance results in improved operating efficiency and market opportunities or in increased legal and regulatory hassles. In this paper, we use a survey and case-law review to investigate the degree to which improved environmental performance is being institutionalized in US firms and to determine what the potential legal consequences are for firms that fail to achieve such institutionalization. Our findings suggest that firms in US industry have made considerable efforts to institutionalize improved environmental performance, but they still have a long way to go. Unfortunately, our findings also suggest that failing to effectively institutionalize environmental performance has the potential for dire consequences, such as jail terms for strategic managers for environmental violations by subordinates. © 1998 John Wiley & Sons, Ltd and ERP Environment.     

Understanding sustainable development flexibility: An information perspective

Although flexibility has been considered critical in responding to uncertainty in a business environment, few studies have explored firms' flexibility in sustainable development. To understand the nature of firms that can respond better to uncertainty in their sustainable development practices, this study defines sustainable development flexibility and investigates the mechanism underlying its formation. The study proposes a conceptual framework on the interactions of managers' environmental attitude and cognitive style, as well as firms' information integration on sustainable development flexibility. A questionnaire survey was developed to test the corresponding hypotheses, and 241 valid responses were received from middle- and top-level managers in Chinese firms. The results show that (a) the higher the manager's environmental attitude, the higher the firm's information integration and greater sustainable supply chain flexibility, and (b) the more intuitive the manager's cognitive style, the greater the impact of environmental attitude on sustainable development flexibility.     

Hard,soft or ambidextrous? Which influence style promotes managers’ task performance and the role of political skill

Abstract

Ambidexterity at the manager level focuses on the crucial, but underexplored, role of managers’ knowledge, skills, and behaviors to address competing demands and promote organizational ambidexterity. As such, to successfully complete their assigned duties, managers need to employ the appropriate interpersonal style and calibrate their behavior to different contextual demands. This study highlights the role of the individual in the ambidexterity process by introducing the concept of influence tactic ambidexterity, to denote the frequent use of both hard and soft influence and investigating its role on task performance. Drawing on the literature on ambidexterity and HRM, we analyze data from a sample of 172 middle managers and their corresponding 68 supervisors working for multinational organizations, and provide evidence that influence tactic ambidexterity relates to higher levels and less variation in managers’ task performance compared to the sole use of either hard or soft tactics. Our findings also show that political skill positively moderates the relationship between influence tactic ambidexterity and a manager’s task performance. Therefore, this study suggests that influence tactic ambidexterity and political skill can be considered valuable HR assets for managers.     

The role of green innovation and hope in employee retention

Green innovation is increasingly receiving attention in organisational behaviour and strategic management literature. However, understanding employee's preferences for organisations that have adopted innovative environmental practices have received little attention. This study tests a framework that examines the relationship between employees' preferences for innovative green organisations, hope, and intentions to stay. Data were collected from 403 employees in Australia. Results show that employees' preferences for green innovation drive the emotional state of employee hope, which has a positive effect on employees' intentions to stay with the organisation. This study offers implications for academics and managers, advancing the literature on green innovation, recruitment, retention, and organisational behaviour.     

The Relationship Between Task Interdependency and Role Stress: A Revisit of the Job Demands–Control Model*

abstract Drawing from Karasek's job demands–control model, this study investigated how perceived amount and clarity of interdependency in managers’ jobs affect role stress, and the extent to which job control moderates these relationships. Results show that amount of interdependency was positively associated with role conflict, and clarity of interdependency was negatively associated with role ambiguity. There was also support for the job demands–control model as greater job control reduced role ambiguity when clarity of interdependency was low. Although higher job control produced lower role ambiguity when both clarity and amount of interdependency were low, higher job control did not produce lower role ambiguity when clarity of interdependency was low and amount of interdependency was high, suggesting that the buffering value of job control on reducing role stress is contingent on the task interdependencies that managers confront.     

An integral model for the implementation of environmental policy strategy

This article responds to demands for a more in‐depth study on how to implement an environmental policy strategy (EPS). Following the strategic choice framework, this study seeks to address this issue by testing a theoretical model of several managerial and organisational variables associated with a firm's EPS. The managerial variables examined include managers' perceptions of environmental pressures, managers' consciousness of environmental problems, and managers' perceptions of the potential benefits associated with the implementation of an EPS. The organisational variables that are investigated relate to the structure, systems, and processes of the representative organisations. Control variables include the firm's industrial sector, its country of origin, its size, and its international character. A model based on structural equations with the weighted least squares estimation method is used to test the hypotheses in a large sample of firms. The results confirm the need to consider a multidisciplinary view of the implementation of an EPS.