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Publisher : Elsevier - Science Direct (الزویر - ساینس دایرکت)
Journal : Journal of International Management, Volume 14, Issue 4, December 2008, Pages 364–376
With the worldwide increase in the adoption of environmental management systems (EMSs), some research has emerged that evaluates the reasons why facilities adopt them. However, there is little information about how these motivations extend to different international settings, and the link between the comprehensiveness of an EMS and business performance has yet to be demonstrated. While both institutional pressures and resources and capabilities may encourage EMS adoption and improved business performance, questions remain about whether organizations that are motivated mainly by their resources and capabilities benefit to the same extent as organizations that are driven to adopt an EMS mainly because of institutional pressures. We analyze these relationships using OECD survey data from manufacturing facilities operating in Canada, Germany, Hungary, and the United States. Our results show that facilities that are motivated to adopt more comprehensive EMSs because of their complementary resources and capabilities, such as export orientation, employee commitment and environmental R&D, (as opposed to institutional pressures) observe greater overall facility-level business performance.
An environmental management system (EMS) consists of a collection of internal policies, assessments, plans and implementation actions (Coglianese and Nash, 2001), affecting the entire organizational unit and its relationships with the natural environment. Since 1996, more than 88,800 facilities worldwide have adopted EMSs that are certified to ISO 14001 (Peglau, 2005), the international EMS standard, and thousands more have adopted other types of EMSs. With the increased number of global EMS adoptions, scholarly interest in EMSs also has burgeoned. Researchers have evaluated the motivations for EMS adoption (e.g., Potoski and Prakash, 2005b, King et al., 2005, Darnall, 2003, Melnyk et al., 2003, Coglianese and Nash, 2001 and Anton et al., 2004) and the relationship between EMS adoption and improved environmental performance (Khanna and Anton, 2002, Potoski and Prakash, 2005a and King et al., 2005). However, as yet, we know little about whether EMSs improve the business value for organizations that adopt them. Previous studies that evaluate the broader link between an organization's environmental strategies and its business performance offer mixed results, with some studies demonstrating that an organization's proactive environmental activities lead to improved business performance (e.g., Russo and Fouts, 1997, Hart and Ahuja, 1996, Rivera, 2002 and Stanwick and Stanwick, 2001), and others illustrating either insignificant (e.g., Levy, 1995, Fogler and Nutt, 1975 and Rockness et al., 1986) or varied findings (e.g., Khanna and Damon, 1999). As such, the argument of whether or not proactive environmental activities lead to improved business performance is far from resolved. Even less is known about how EMSs, in particular, fit into this debate. In understanding the link between EMSs and business performance, it is important to consider the motivations for adopting these management systems. Previous research utilizes differing theoretical perspectives. On one hand, a group of scholars has relied on aspects of institutional theory to explain why organizations adopt EMSs and other proactive environmental strategies (e.g., Bansal and Roth, 2000, Hoffman, 1999, Davidson and Worrell, 2001, Bansal and Clelland, 2004, Khanna and Anton, 2002 and Bansal and Hunter, 2003). These authors suggest that organizations are motivated to increase their internal efficiency and external legitimacy, which also can lead to competitive advantage. On the other hand, scholars have relied on the resource-based view of the firm to explain that complementary resources and capabilities lead to the adoption of proactive environmental strategies (e.g., Sharma and Vredenburg, 1998, Darnall and Edwards, 2006 and Aragόn-Correa and Sharma, 2003) and improved business performance (e.g., Russo and Fouts, 1997). By implementing these strategies, these authors suggest that organizations are more likely to gain competitive advantage. In a fewer number of instances, researchers have combined both theoretical views, (e.g., Bansal, 2005 and Darnall, 2003) and reached similar conclusions to previous studies that consider both theories individually. However, little scholarship has examined the relative contributions of institutional theory and the resource-based view of the firm to determine the motivations for EMS adoption, and the extent to which these two theories are associated more (or less) with improved business performance. While both institutional pressures and resources and capabilities may encourage EMS adoption and improved business performance, questions remain about whether organizations that are motivated mainly by their resources and capabilities benefit to the same extent as organizations that are driven to adopt an EMS mainly because of institutional pressures. Studying the relative contribution of both theoretical perspectives would enhance our understanding of these theories to a much greater degree. Finally, previous research examining the motivations to adopt an EMS (Bansal and Hunter, 2003, Potoski and Prakash, 2005b, King et al., 2005, Darnall, 2003, Melnyk et al., 2003, Coglianese and Nash, 2001 and Anton et al., 2004) and the relationship between proactive environmental activities and business performance (Russo and Fouts, 1997, Hart and Ahuja, 1996 and Stanwick and Stanwick, 2001) generally has focused on organizations operating in the United States (U.S.). As yet, we know little about whether these relationships can be generalized to the broader international setting and whether international capabilities such as export orientation are a significant motivator for facilities to adopt more comprehensive EMSs. In this paper, we make three contributions to the existing literature. First, we consider both institutional theory and resource-based view of the firm to determine the motivations for EMS adoption at the facility level. These motivations include an important international capability, namely, export orientation, as well as the institutional pressures each facility faces. Second, we examine and empirically test the relative contribution of each of these theoretical perspectives to a facility's overall business performance across four countries (Canada, Hungary, Germany and the United States) and find that our results do generalize to a broader international setting in that facilities that are more motivated to adopt more comprehensive EMSs because of their complementary resources and capabilities observe greater overall facility-level performance. Third, this study takes a significant step forward in advancing our understanding of environmental management in the global context in that our findings suggest that export orientation is an important complementary capability to a facility's decision to adopt more comprehensive environmental management practices.
نتیجه گیری انگلیسی
The results of this research build on prior studies evaluating the motivations for EMS adoption (e.g., Potoski and Prakash, 2005b, King et al., 2005, Darnall, 2003, Melnyk et al., 2003, Coglianese and Nash, 2001 and Anton et al., 2004) and the relationship between EMS adoption and improved environmental performance (Potoski and Prakash, 2005a and King et al., 2005). It offers three contributions to theory and practice. First, this study provides empirical evidence of the potential business value created by adopting a comprehensive EMS. After controlling for the endogenous relationship between EMS adoption and business performance, it appears that facilities which adopt more comprehensive EMSs can benefit financially. These findings fuel the ongoing discussion regarding whether or not it pays to be “green,” and offers evidence about how EMSs, in particular, fit into this debate. Second, the results of this study broaden our understanding of institutional theory and the resource-based view of the firm by exploring their relative contributions to the decision to adopt a more comprehensive EMS and to subsequent facility business performance. While this study confirms that institutional pressures and resources and capabilities both encourage more comprehensive EMS adoption, facilities that are driven mainly by their resources and capabilities (rather than institutional pressures) are more likely to obtain positive business performance. One reason for these findings may be that facilities that are guided to adopt EMSs due to institutional pressures may be using these management systems more as symbolic actions to increase external legitimacy (Bansal and Hunter, 2003) without necessarily improving internal efficiencies. In such instances, facilities may be devoting more resources to meet, challenge or even defy the institutional forces they are currently facing (Oliver, 1997b) rather than finding or developing the complementary resources and capabilities necessary to meet their environmental challenges. Reacting to institutional pressures in this way may lead to some financial gain by increasing external legitimacy, at least in the short run. However, these facilities lack the internal capabilities and resources to maintain their EMS over time (Darnall and Edwards, 2006). Such capabilities include the tacit capacities developed from quality management systems, employee commitment, export orientation, and resource commitments in the form of an environmental research and development budget. Capabilities and resources such as these help develop cross-functional and cross-stakeholder management practices that are socially complex, and shared visions that are difficult for competitors to replicate (Hart, 1995 and Sharma and Vredenburg, 1998). They also help to improve organizational reputation and strategically align the facility with future changes in the general business environment (Hart, 1995, Sharma and Vredenburg, 1998 and Aragόn-Correa and Sharma, 2003). Facilities that fail to develop their complex capabilities, therefore, appear to forego these competitive advantage opportunities. Third, this study takes a significant step forward in advancing our understanding of environmental management in the global context in that our findings suggest that a facility's export orientation is an important complementary capability to its decision to adopt more comprehensive environmental management practices. While previous research has examined the motivations to adopt EMS (Potoski and Prakash, 2005b, King et al., 2005, Darnall, 2003, Melnyk et al., 2003, Coglianese and Nash, 2001 and Anton et al., 2004) and the relationship between proactive environmental activities and business performance (Russo and Fouts, 1997, Hart and Ahuja, 1996 and Stanwick and Stanwick, 2001), most of this scholarship has focused on organizations in a single country, and more specifically U.S. organizations. By examining these relationships for facilities in four OECD countries, results of this research can be generalized to a much broader international setting and makes an important contribution to existing scholarship. Two limitations of our research should be noted. First, self-reported data may be biased in that environmental managers may have exaggerated their facility's environmental activities and business performance. From the onset of this study, we believed that respondents might consist of facilities with more ambitious environmental strategies. We further believed that respondents might want to describe their environmental strategies as being more rigorous than they actually were. While our results suggest that the facility managers were not reluctant to identify the shortcomings of their environmental strategies and profitability, the potential bias would tend to reduce the variance in our sample. As such, we would be less likely to find statistically significant relationships. However, by finding statistically significant relationships, additional evidence is offered about the strength of the relationship between the variables in our models (Hardin and Hilbe, 2001). Second, publicly available databases on information on “objective pressures” (Delmas and Toffel, 2004) such as the number of compliance violations and enforcement actions taken against the facility (regulatory pressures), interest group ratings of politicians to measure political pressures and the proportion of population proximate to the facility who are members of environmental or conservation groups to measure community environmental activism would have made wonderful additions to this study. Unfortunately, such databases are not available across the four countries we study. Therefore, the OECD survey measures of the perceptions of institutional actors, as well as the number of facility inspections, provide the only data available at this unit of analysis across the four countries. These findings have important implications for future research. Regulatory, market and social pressures for environmental consideration may prompt many facilities to adopt EMSs when they lack the complementary resources and capabilities that foster continual environmental improvement over time. These facilities also may develop EMSs that have less ambitious environmental goals and, therefore, may not improve their environmental performance or reap only a marginal financial gain. In still other instances, a facility's weak resources and capabilities may explain why it later endures stronger institutional pressures to address its environmental harms, which then give rise to environmental action. These examples illustrate that facilities' institutional pressures and resource and capabilities may be interrelated to a much greater degree than previously conceived. Future scholarship would benefit by evaluating these temporal relationships further. Related to international management, additional scholarship is needed to help in our understanding of how EMS practices are influenced by national cultures. For example, our empirical analysis shows that the estimated coefficients on the country specific dummy variables in our EMS equations (models 1 through 4) are each negative and significant indicating that facilities located in the U.S. are more likely to implement a more comprehensive EMS than those located in Canada, Germany or Hungary. The estimated country specific dummy variables in the business performance equation (model 5) are each positive and statistically significant indicating that facilities located in Canada, Germany and Hungary, ceteris paribus, have greater business performance than those located in the U.S. We control for country differences in our analysis, however, we are not modeling the sources of these differences per se. While the nature of our data limits us from assessing temporal and culture-based issues, these issues are important and future research should examine them. In summary, this study evaluates whether EMSs can create business value across multiple international settings. It shows that facilities are driven to adopt more comprehensive EMSs in response to institutional pressures for greater external legitimacy, and desires to build upon existing complementary resources and capabilities. However, facilities that rely on their resources and capabilities such as export orientation, quality management, R&D and employee commitment in developing their EMSs are more likely to improve their overall business performance.