| Environmental Strategies and Firm Competitiveness: A Critical Review of the Evidence and New Directions |
| | Christmann, Petra | Darden Business School, U. of Virginia | ChristmanP@Virginia.edu | (804)-924-3995 |
| | The effects of firms' environmental strategies on their competitiveness have been analyzed from a variety of perspectives. Predictions and
empirical results of different perspectives are conflicting and inconclusive. This paper reviews five existing perspectives and their empirical
evidence. Reasons for conflicting empirical findings of the perspectives are identified, ways to reconcile the contradictory findings are
suggested, and suggestions for further research are developed.
While the environmental economics literature suggests that environmental protection lowers competitiveness, the environmental management
literature and the dynamic perspective of environmental regulation suggest that implementation of certain environmental practices can
increase competitiveness. The social responsibility and the finance literature both analyze the relationship between environmental performance
and competitiveness and come to inconclusive results. Reasons for the differences in the predictions and empirical results include differences
in the conceptualization of the key variables across the perspectives. Environmental strategies are conceptualized as responses to
environmental regulations, as choosing and implementing the right environmental practices, and as environmental performance.
Competitiveness is conceptualized as cost and differentiation advantages and as financial performance, as absolute advantage or as
advantage relative to competitors, and as short-term or long-term advantage. In addition, differences in the level of analysis - firm versus
industry-, and the omission of several important variables in the analysis - asymmetries in firm resources and capabilities, and characteristics
of environmental issues - contribute to the different results. It is suggested that the inclusion of these variables in the analysis can reconcile
the conflicting findings.
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| | Keywords: Environmental Strategies; Firm Competitveness |
| Voluntary Environmental Initiatives: a Resource-Based Perspective |
| | Paton, Bruce | U. of California, Santa Cruz | paton@cats.ucsc.edu | 408)247-8745 |
| | Voluntary environmental initiatives are private or public efforts to promote improvements in
corporate environmental performance not required by law. Despite the growing importance of
these voluntary initiatives, practice has outrun theory. Theory in both corporate environmental
strategy and public policy has failed to address voluntary environmental initiatives adequately, in
part, because these efforts appear to conflict with the underlying economic theory of the firm.
Recent empirical evidence has identified at least three trends in corporate environmental
performance that traditional theory cannot readily explain. First, many corporations have
autonomously reduced environmental impacts from their operations and their products. Second,
policy experiments such as the U.S. EPA's Energy STAR program have helped induce extensive,
voluntary improvements in environmental performance. Finally, firms within the same industry
have varied widely in their participation in voluntary initiatives. None of these trends could have
occurred, if firms had been acting in accordance with conventional economic theory of the firm.
Recent theory at the intersection of economics and business strategy could help explain
these anomalies and reduce the gap between theory and practice. This paper describes how
resource-based strategy can help explain the apparent success of voluntary environmental
initiatives. Resource-based strategy's focus on firms' efforts to differentiate themselves provides
an insightful framework for interpreting the choices that firms make in deciding to participate in
voluntary environmental initiatives.
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| | Keywords: resource-based strategy,; voluntary initiatives,; Porter hypothesis |
| Natural Capital, Geographic Concentration, and the Emergence of Sustainable Industries |
| | Russo, Michael V. | U. of Oregon | mrusso@oregon.uoregon.edu | (541)-346-5182 |
| | This paper focuses on the emergence and growth of sustainable industries,
specifically analyzing the rise of the wind energy industry in California.
Based on a favorable institutional environment and the presence of abundant
natural capital, the wind energy industry took root and flourished in
California during the last two decades. This paper analyzes this
phenomenon by hypothesizing the determinants of where and when wind
energy projects would be founded. The results suggest that the presence
of multiple, mutually-supportive economic, social, and natural influences
generated greater numbers of wind energy projects. The paper concludes
by discussing implications for the rise of other sustainable industries
and for research in organizations and the natural environment. |
| | Keywords: Environment; Entrepreneurship; Renewable Energy |