An empirical study of the initial adoption of ISO 14001 in Japanese manufacturing firms

This paper analyzes stakeholders' environmental preferences/pressures and the financial flexibility that together influence firms to adopt ISO 14001, which is the international standard primarily concerned with an Environmental Management System (EMS). Since firms retain ISO 14001 once they have adopted it, a firm's decision to adopt ISO 14001 is considered from the period that they initially acquire the certification. Therefore, we assert that we have to focus on the determinants of initial ISO 14001 adoption. We analyzed: 1) the determinants of initial ISO 14001 adoptions respective to 1996, 1999, and 2004; and 2) the determinants of initial ISO 14001 adoptions during the period 1996-2004. The estimation results support the view that stakeholders' environmental preferences/pressures and firms' financial flexibility influenced their decision to adopt ISO 14001 in both analyses. Particularly, it is remarkable that we found that: 1) the determinants of the initial ISO 14001 adoption differed among the years of adoption; and 2) there is a positive relationship between economic performance and initial ISO 14001 adoption.     

Assessing participation in voluntary environmental programmes in the developing world: the role of FDI and export orientation on ISO14001 adoption in Thailand

Empirical assessments of the determinants of firm participation in Voluntary Environmental Programmes (VEPs) in the developing world are largely absent from the environmental regulation literature, leaving a number of important factors unique to such countries unexplored. This article examines these factors, namely the roles played by Foreign Direct Investment (FDI) and export orientation, in addition to factors deemed important in the industrialized world context to the problem of ISO14001 adoption in one developing nation, Thailand. We make use of unique primary data from 494 firms, and focus on three important industries, the resource-based food and beverages industry, the labour-intensive textiles and wearing apparel industry, and the more high-technology electronics and electrical appliances industry. We find that FDI plays a role in ISO14001 adoption, especially FDI from Organization for Economic Co-operation and Development (OECD) and ISO14001-rich countries. Other important determinants include firm size, experience with ISO9000, and production of intermediate products. Firms faced with fewer obstacles to environmental improvements such as those facing lower costs, having more understanding of the procedure, and with greater access to the appropriate technology are also more likely to adopt ISO14001.     

DETERMINANTS OF A FIRM'S ISO 14001 CERTIFICATION: AN EMPIRICAL STUDY OF TAIWAN

Abstract.   Only rarely have empirical studies analysed the responses of Taiwanese manufacturing firms to ISO 14001, despite firm responses to environmental issues being an important aspect of environmental management. This study empirically examines the determinants of firms' environmental self-governance. Export oriented Taiwanese firms, which face environmental concerns from foreign consumers, are found to be more likely than domestic focused firms to adopt ISO 14001. This study also finds that several firm attributes are decisive for firm adoption of ISO 14001. However, this study does not find any significant impact of local governors' political party affiliation on firms' ISO 14001 certifications.     

The inter‐relationship between capital structure and dividend policy: empirical evidence from Jordanian data

The study investigates the under‐researched relationship between capital structure and dividend policy in emerging markets with regard to the Jordanian market. The empirical analysis focuses on the estimation of both single equation models and structure equation models using the reduced form equations to examine the joint determinants of capital structure and dividend policy. The study investigates whether capital structure and dividend policy theories can explain the financial decisions in emerging market such as the Jordanian market. Namely, the study examines agency theory, signalling theory, pecking order theory and bankruptcy theory. The results indicate that there is a positive relationship between debt‐to‐asset ratio on the one hand, and asset tangibility, profitability, market‐to‐book, liquidity, firm size, and industry classification on the other hand. Also, there is a negative relationship between debt‐to‐asset ratio and profitability. In addition, there is a positive relationship between dividend payout ratio on the one hand, and profitability, asset tangibility, market‐to‐book and industry classification on the other hand. Finally, the results of the reduced form equations show that capital structure and dividend policy have the following common factors: profitability; asset tangibility; market‐to‐book; industry classification; and limited evidence of institutional ownership. Therefore, the determinants of capital structure and dividend policy in emerging markets such as the Jordanian market share the same set of suggested factors with the developed markets.     

Productivity,capital intensity,and ISO 14001 adoption: Theory and evidence

The determinants of ISO 14001 adoption have been considered to fall into two categories: external pressure from environment‐oriented stakeholders or customers and internal need due to expected future benefits. In this study, we further elaborate the mechanism underlying firms’ adoption of the standard by investigating the inter‐relationship among firms’ productivity, capital intensity, and decision making regarding adoption. Applying a general equilibrium model, we show that under optimal conditions, highly productive firms can benefit more from adoption. Moreover, technological advancements potentially drive up firms’ capital intensity and this positively affects their incentive for adoption. The empirical practice using firm‐level data in Vietnam verifies our predictions with robustness. In addition, we find that the phenomenon outlined above becomes even more obvious in the manufacturing sectors.     

ISO 14001 Environmental Certification: A Sign Valued by the Market?

The main purpose of this work is to analyse whether ISO 14001 certification is interpreted by the capital market as a sign of environmental responsibility, modifying long-term efficiency expectations and the profitability of firms. Under competing assumptions that ISO 14001 certification is adopted by firms either proactively or reactively, we test competing hypotheses about how this certification affects the market value of firms. The analysis is based on a sample of 80 environmental certifications of the plant systems or processes of large Spanish firms which traded on the continuous market of the Madrid Stock Exchange from 1996 to 2002. Using event study methodology, we found that ISO 14001 certification has a negative effect on the market value of certain firms. Specifically, the results obtained seem to show that the market negatively views the allocation of resources to ISO 14001 certification in the case of less polluting and less internationalised firms. On the other hand, the results obtained do not suggest clear evidence that the economic impact of ISO 14001 certification is negative for more polluting and more internationalised firms.     

Labour market characteristics and profitability: An econometric analysis of Hugarian exporting firms, 1986-951

This paper follows through an aspect of microeconomic restructuring in Hungary during the transition period. This restructuring brought about substantial changes in the behaviour of all economic agents. Our study combines labour market and corporate financial information to explore the effect of the quality of labour employed on the profitability of the firm. The quality of labour is measured as that portion of wage differentials that cannot be explained by a standard human capital model. The profitability of Hungarian exporting firms can be explained by economic factors during transition. In addition the quality of labour, export share, wage and bank costs, payables, receivables, foreign ownership, inventories, amortization and equity are all significant explanatory variables.     

Financialization and Manufacturing Firm Profitability under Uncertainty and Macroeconomic Volatility: Evidence from an Emerging Market

Using semi-annual data from 1993 to 2003 for all publicly traded manufacturing firms in Turkey, this paper explores the impacts of macroeconomic uncertainty and external shocks on profitability of real sector firms in the presence of multiple investment options in both real and financial sectors. The paper argues that increasing availability and accessibility of investment opportunities in the financial markets help real sector firms sustain profit margins despite market rigidities, increasing goods market competition, or higher levels of risks. The empirical results based on dynamic panel estimations show that increasing macroeconomic uncertainty and volatility have a significantly negative effect on firm profitability. In contrast, increasing the share of financial investments in total assets is found to be reducing such negative effects at a statistically and economically significant level.     

ISO 14001 and the Reduction of Toxic Emissions

ISO 14001 is an international standard for Environmental Management Systems, adopted by over 36,000 organizations worldwide. This paper attempts to determine the length of time after which a given company has implemented ISO 14001 experiences emission reduction. The sample used is a group of 264 manufacturing facilities in the USA, which represent 23 percent of all the ISO 14001 certified organizations in the US, analyzed throughout the period from 1996 to 2001. The results show that 75 percent of the companies experienced a reduction in their emissions, among which 53 percent had already done so just one year after obtaining ISO 14001.     

Commercial Policy and Foreign Ownership

Foreign multinationals often not only export but also control local firms through FDI. This paper examines the various effects of trade and industrial policies when exports and FDI coexist. We focus on the case in which a foreign firm has full control of a local firm through partial ownership. Cross‐border ownership on the basis of both financial interests and corporate control leads to horizontal market linkages through which tariffs and production subsidies may harm locally owned firms but benefit the foreign firm. Foreign ownership regulation benefits locally owned firms. These results could have strong policy implications for developing countries that attract an increasing share of world FDI.     

Board structure,ownership, and financial distress in banking firms

This investigation pursues a new direction in the analysis of financial distress in banking firms. The research was inspired by recent research on corporate governance and the need to understand the internal processes behind the financial decisions that result in bank failures. The analysis examined the relationship between the ownership and structure of the board of directors and the internal control mechanism that influences the survival of the firm. The following aspects of ownership and governance are investigated: ownership by directors and officers, ownership by the CEO, number of directors, percentage of inside directors, and CEO duality. The influence of board structure and ownership on the probability of financial distress was explored with a sample of approximately 300 banking firms. The empirical tests indicated a lower probability of financial distress when one person is both the CEO and chairman of the board, but the other factors did not have a significant effect.     

A general equilibrium analysis of corporate control and the stock market

This paper studies a general equilibrium model with an investor-controlled firm. Shareholders can vote on the firm??s production plan in an assembly if they dislike management??s decision. Prior to that they may trade shares on the stock market. Since stock market trades determine the distribution of votes, trading is strategic. There is always an equilibrium, where share trading leads to an ownership structure that supports competitive behavior. But there may also be equilibria, where monopolistic behavior prevails.     

Environmental management practices: good or bad news for innovations delivering environmental benefits? The moderating effect of market characteristics

We examine empirically whether environmental management practices (EMPs) (environmental audits, ISO 14001 standard, etc.) promote (or not) additional innovations delivering environmental benefits. Using a large sample of French firms (N=4114) and simultaneous equations model (SEM), we found that EMPs positively influence the decision of firms to introduce innovations delivering environmental benefits, but this positive relationship is moderated by market characteristics. The findings indicate that EMPs promote such environmental-related innovations when the market of the main activity of the firm is growing. However, when the market is uncertain or competitive, this relationship turns out to be negative.     

Demand for ISO 14001 adoption in the global supply chain: An empirical analysis focusing on environmentally conscious markets

This paper analyzes the environmental preferences and pressures of customers in environmentally conscious markets influencing the number of adoptions of ISO 14001—the international standard certified by the International Organization for Standardization (ISO) concerning an Environmental Management System (EMS)—in a country. Customers in different countries have different priorities and ideas with regard to the environment and its management, and therefore it is possible that environmental preferences and pressures of customers in environmentally conscious markets are greater, although many earlier studies suggest that foreign customers generally form a significant stakeholder group encouraging the adoption of ISO 14001. A random-effects Tobit estimation using a sample of 155 countries over eight years supports the view that the environmental preferences and pressures of customers in environmentally conscious markets (including Finland, Japan, Germany and Denmark) are more likely to encourage domestic along with foreign suppliers to adopt ISO 14001. As it is easier for firms in environmentally conscious markets to adopt ISO 14001 because of their better economic performance, they have already adopted certification and consequently require their domestic and foreign suppliers to do likewise in the global supply chain. For this reason, suppliers wishing to access environmentally conscious markets can obtain an advantage with ISO 14001 certification.     

Noise traders,firm-specific uncertainty and technical trading effectiveness

This is the first study to document evidence of technical trading effectiveness at firm level in the Chinese A-share market by investigating the relationship between excess profits of technical trading rules and firm-specific characteristics. Our results reveal that firms with higher excess profits from technical trading have more noise traders and higher institutional ownership and that those firms tend to be growth firms with lower liquidity and higher firm-specific uncertainty. Further analysis shows that the profitability of technical trading rules is unsustainable and the excess profits of the highest technical trading profit quintile portfolio disappear in the following year.     

Bargaining externalities in a privatization programme

In privatization programmes, the state commonly keeps a minority ownership stake in firms. We provide an explanation based on the externality that privatization of one firm has on the profitability of others. If this externality is negative, as with oligopolistic firms, the government can gain a strategic advantage in bargaining over the sale of one firm if it keeps an ownership share in another. We consider both the simultaneous and the sequential sale of firms. The results apply to the period in which privatization takes place, and are consistent with the delayed sale of minority ownership often observed in practice.     

Absentee Ownership of Immobile Factors and Environmental Policies in a Federation

This paper studies the effects of absentee ownership of immobile factors on environmental policy of a jurisdiction in a federation. An increase in emissions in a jurisdiction increases factor incomes, but part of the increased factor incomes goes to absentee owners while only the residents of the jurisdiction bear the full disutility. In addition, the increase in emissions in a jurisdiction attracts capital and decreases capital in other jurisdictions, reducing the incomes that the residents of the jurisdiction earn from owning immobile factors in other jurisdictions. Absentee ownership thus reduces the marginal benefit of an increase in emissions while it leaves the marginal cost unaffected from the jurisdiction’s perspective. As a consequence, absentee ownership makes environmental policy of a jurisdiction too stringent relative to the efficient level. The paper also considers the effects of absentee ownership on environmental policy when goods trade is allowed.     

辽宁上市公司资本结构影响因素研究

运用多元回归分析法研究了辽宁43家上市公司资本结构的特点和影响因素。根据实证分析的结果,发现盈利能力和股权结构与资本结构存在显著的负相关关系,企业规模与资本结构存在显著的正相关关系,企业的收益波动性和资产抵押价值与资本结构具有较弱的正相关关系。根据分析结果针对辽宁上市公司具体情况及资本市场发展现状提出了优化资本结构的一些建议。     

Ownership Structure and Firm Performance: Evidence from Vietnamese Listed Firms

We examine the effect of ownership structure on firm performance, for firms listed on Vietnamese stock exchanges, using 2744 firm‐year observations over the period from 2007 to 2012. We find a non‐linear relationship between ownership structure and firm performance. State ownership has a convex relationship with firm performance. This paper finds that firm performance increases beyond 28.67 percent level of state ownership. Foreign ownership has a concave relationship with firm performance. We find that firm performance increases with an increase of foreign ownership up to a level of 43 percent and then decreases. Policy makers should encourage foreign ownership and widely dispersed state ownership in firms, which can help improve firm performance.     

A new insight into environmental innovation: Does the maturity of environmental management systems matter?

Technological innovation has recently become more essential than ever. To examine the factors that might induce environmental technological innovation, we focus on ISO 14001, a voluntary approach to environmental management, and scrutinise how the proficiency or maturity level of ISO 14001 in facilities influences environment-related research and development (R&D) expenditures that promote environmental technological innovation. We measure the maturity level based on the length of time since a given facility adopted ISO 14001. Using Japanese facility-level data from “Environmental Policy Tools and Firm-Level Management and Practices: An International Survey” (OECD Survey), we estimate two Tobit models by addressing an endogeneity issue in ISO 14001. The estimation results provide empirical evidence that as the ISO 14001 is improved in facilities, those facilities are likely to spend more on environmental R&D. The facility age and market concentration also positively affect environmental R&D. These findings suggest that the maturity level of ISO 14001 is an important factor influencing the investment in environmental R&D.