Year: 2014
Type: article
Abstract: This research illuminates the differences among US-based multinational corporations (MNCs) that operate in a pro-environmentally responsible manner and those that do not.I asked: What factors might explain differences between weak and strong performance among MNCs?I investigated different groups and explored the following lines of inquiry: Does industry matter?What can explain discrepancies in firms' accounts of their performance when compared to actual performance?I applied an open mixed method approach that used five datasets: (a) firms' environmental performance as reported by Newsweek statistics, (b) firms' safety performance as reported to OSHA, (c) a survey conducted among top executives of the Fortune 500 companies, (d) 78 interviews with top US-and India-based executives of the MNCs, and (e) field observations of MNCs' facilities in India.I discovered two distinct drivers that explain environmental performance: (a) organizational consciousness, and (b) elevated concern for employee safety.Organizational consciousness is a reflection of proactive management (characterized as heedful, alert, and caring about policies and operations).I observed that xiii the Resource-Based View and institutional factors alone cannot explain significant differences between strong vs. weak environmental performers.I found the most significant difference is explained by industry type: (a) high-performing manufacturers have a greater ability to transfer knowledge across functional boundaries and source, and exploit new knowledge for environmental performance; (b) low-performing manufacturers are reluctant to allocate sufficient resources, and use "short-term fixes" to avoid risks associated with uncertain environmental outcomes, and (c) service companies do not see that they represent a risk to the environment and place a low priority on environmental concerns.Surprisingly, a number of firms underestimated their environmental performance (termed "Greenmodest"), and these share the following attributes: (a) primarily service companies, and (b) see a weak connection between their environmental performance, organizational capacities, and external pressure.In contrast, "Greenwashing" firms (a) are mainly manufacturers, (b) are older and more traditional, (c) have higher per-employee annual revenues, (d) are anxious about making decisions, and (e) try to "just get by.""Greenhonests" -whose perception of the firm's environmental performance aligned with actual performance -prioritize accurate measurement of environmental performance.Overall, the study provides new and surprising insights into factors that explain superior environmental performance among large companies.
Author: David Klossner
Institution: Case Western Reserve University
Language: English
Subfield: Marketing
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W2597570561