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Voluntary Environmental Programs: A Comparative Perspective

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Abstract

Voluntary environmental programs (VEPs) are institutions for inducing firms to produce environmental goods beyond legal requirements. A comparative perspective on VEPs shows how incentives to sponsor and participate in VEPs vary across countries in ways that reveal their potential and limitations. Our brief survey examines conditions under which VEPs emerge, attract participants, and improve participants' environmental performance. We focus on the costs and bene-fits for actors seeking to supply (or sponsor) these governance mechanisms as well as the costs and benefits for firms who are considering joining VEPs and adhering to their program obligations. © 2011 by the Association for Public Policy Analysis and Management.

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... Existing research on club goods focuses more on how to maintain the publicness of club goods such as privately-owned public spaces (Schmidt et al., 2011), to efficiently manage common resources through internal entitlement allocation, negotiation, or bargaining (Slaev and Collier, 2018), or to minimize clubs' negative externalities or to correct market actions through collective approaches (Prakash and Potoski, 2012;Slaev and Daskalova, 2020). However, less attention is paid to how public policies, especially the way the policies are designed, may influence club goods' thriving. ...
... Many private actors' interests in environment/greenspace engagement are economic benefits from service development and management (Azadi et al., 2011). Prakash and Potoski (2012) study voluntary environmental clubs, which encourage participating businesses to produce positive environmental benefits, and find that the private actors, in order to maximize self-interest, may practice free ridings and shirk in collective club actions. The benefits of affiliating with voluntary environmental clubs lie with a green-brand reputation, a non-rival but excludable benefit. ...
... They identified those common greenspaces in neighborhoods as club goods as their accessibility is restricted largely to households close to the space. Given the club approach's profit-driven interest and limited accessibility, governments may want to use policy tools to guide the private sector to a more sustainable development direction and encourage clubs to attract more private actors to participate in the club to have a broader, positive influence (Prakash and Potoski, 2012). ...
Article
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Greenspace provision in high-density metropolises is often constrained by land shortage; market-based tools show the potential to solve the problem. Privately-owned public greenspace is a type of club goods provided by private developers to club members with non-rival but excludable benefits. Club goods are for-profit, and their sustainability, or the long-term ability to deliver high-quality services, entails appropriate policy design. This paper explores how policy design influences club good’s sustainable provision, exemplified by the new developments of for-profit shopping-mall roof gardens in Shanghai, China. Such gardens established by developers to serve mall customers are club goods, providing ecosystem services and becoming significant compensation for urban greenspace shortage. Through field investigations and in-depth interviews, authors find that the current green-roof policy design increased roof gardens’ quantity but not quality and brought about gaps in legitimacy, profitability, and non-compliance. This research concludes that (1) general policy design can boost club good production; (2) more tailored policy design, including cross-department collaboration and tailored policymaking, are indispensable to improve clubs’ sustainability. This study suggests that policy designers take club good’s intrinsic characteristics into consideration and address the legitimacy, profitability, and compliance problems, which will enable market-based tools to be better utilized in public-goods provision.
... In the context of this study, I define VEPs as either centralized or decentralized institutions developed to systematically address a defined aspect of corporate environmental impacts, management, or performance, soliciting or recognizing participation by firms on a voluntary basis, with three key defining features: (1) standards of conformance prescribed by an external body, (2) some minimal level of effort by participating firms required to achieve those standards, and (3) some measure of external evaluation as evidence or recognition of achievement, which may be self-declared by firms or certified by a third party. Regarding the latter two features, this definition does not specify any particular level of stringency of standards or monitoring and enforcement of conformance, two factors established in literature as key to VEP effectiveness (Prakash & Potoski, 2012;Tashman et al., 2021). VEPs thus include institutions such as government initiatives (Delmas & Montes-Sancho, 2010;Kim & Lyon, 2011b), information disclosure programs (Etzion & Ferraro, 2010;Kim & Lyon, 2011a;Miller et al., 2017), industry self-regulatory programs (A. A. King & Lenox, 2000;Lenox & Nash, 2003), environmental management systems (Christmann & Taylor, 2006;A. ...
... G. King & Soule, 2007), stakeholder demands (Flammer et al., 2019), and firm visibility (Aronson & LaFont, 2020). Firm-specific factors may also motivate adoption, such as financial and environmental performance (Prakash & Potoski, 2012), characteristics of firm executive leadership (Lewis et al., 2014), or strategic fit with extant capabilities (Dowell & Muthulingam, 2017). Industry factors such as customer requirements (A. A. King et al., 2005), competitive dynamics (DeBoer et al., 2017), and industry association pressures (Tyler et al., 2020), may straddle these two categories. ...
... Moreover, firms with governance structures more accommodating to environmental management have greater capacity for participation (Jaggi et al., 2018). Whereas VEP largely seek to improve corporate environmental performance, firms are more likely to self-select into VEPs where doing so provides an opportunity to showcase superior environmental performance to key stakeholders (Prakash & Potoski, 2012). Where new environmental programs represent a radical departure from a firm's capabilities, firms are less likely to adopt (Dowell & Muthulingam, 2017). ...
Article
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Voluntary environmental programs (VEPs) offer opportunities for companies and stakeholders to improve environmental outcomes valued by society in the absence of regulatory mandates. Research has addressed numerous antecedents for firm adoption of VEPs, enhancing knowledge of how stakeholders and firms engage on substantive issues of public importance. However, program adoption is dynamic, and stagnant participation rates may threaten program longevity when firms do not realize expected benefits. Prior literature has not sufficiently addressed the factors that compel firms to drop out. In this study I articulate three consequential drivers of firm commitment to VEPs—transparency, effort, and achievement—and empirically estimate their effects on firm disengagement from one such prominent program: CDP (formerly known as Carbon Disclosure Project). Findings indicate that firm transparency and effort represent powerful commitment mechanisms driving continued program participation. This study contributes to theory over multiple literatures related to VEP participation and offers practical guidance for both VEPs and firms.
... Private benefits can be major incentives for firms to engage with third-party sustainability certification (Prakash and Potoski, 2007). These benefits include improved corporate reputation, customer loyalty, regulatory relief, higher product prices, and increased market shares (Henson and Humphrey, 2010;Prakash and Potoski, 2012; Steering Committee of the State-of-Knowledge Assessment of Standards and Certification, 2012). Additionally, benefits of sustainability certification include greater economic efficiency of integrating sustainability into product supply by reducing inter-firm coordination costs, harmonizing sourcing requirements, and achieving economies of scale in production (Abbott and Snidal, 2001;Wathne and Heide, 2004;Hatanaka et al. 2005;Geibler, 2013). ...
... Due to uncertainty as to the number of credible commitments by firms (Ostrom, 2010), multi-stakeholder certifications can be risky. Future risks include tightening the requirements of the standard after firms have already adopted the certification (Prakash and Potoski, 2012). This perceived threat can be further aggravated if engagement with certification requires high costs and assetspecific investments, limiting corporate opportunities to exit the scheme (Williamson, 1985;Ostrom, 2010). ...
... Yet, they have higher costs, as their adoption can require investments to achieve compliance in the supply chain (Chkanikova, 2015). Where costs can be reduced via CA, the increased number of participants can lead to lowering the level of certification requirements when going through a collaborative development process (Prakash and Potoski, 2012;Bartley, 2007). ...
Article
The purpose of this study is to examine the proliferation of retail-driven sustainability certification schemes focusing on the role of certification and its design from a corporate perspective. It does so by exploring three different cases of certification design in the food retailing industry: unilateral Tesco Nurture, collaborative GlobalGAP, and multi-stakeholder UTZ certifications. Using case study methods and viewing the certifications through the application of collective action logic and dynamic capability theory, we provide new insights important to researchers, retailers, and supply chains. The results of this study show that retail efforts to develop certifications are driven by better alignment with the business’ goal of improving the sustainability performance of supply chains. Retail-driven certifications can enable stronger brand assurance, stakeholder satisfaction, competitive development of certified supply volumes, and dynamic capabilities that contribute to effective, efficient and faster upgrades to sustainability practices in the supply chain. The contributions of this study also identify numerous factors that influence the development of certifications via collaborative/multi-stakeholder or unilateral efforts. There are three major factors: 1) trade-offs between different aspects of certification design and institutional-stakeholder context, 2) challenges of ‘collective’ bargaining, and 3) generation of dynamic capabilities. From results, we posit the co-existence of multiple certifications, called “standards multiplicity,” as advantageous for facilitating retailers’ engagement with sustainable supply chain management. Finally, conclusions and implications allow us to predict the evolving complexity of retail-driven certifications will enable dynamic capabilities, opportunities for creating competitive advantage, and open a dialogue for other industries to learn from these insights. [Citatiom: Chkanikova, O., & Sroufe, R. (2021). Third-party sustainability certifications in food retailing: Certification design from a sustainable supply chain management perspective. Journal of Cleaner Production, 282, 124344.]
... From the macro level, voluntary green power programs can be considered a unilateral industry-led voluntary environmental program (VEP) based on the common taxonomy of VEPs discussed in Alberini & Segerson [13]. Studies have found that stringency of government regulations influences firms' motivations to sponsor VEPs [14]. On the one hand, more stringent and strictly enforced regulations reduce incentives for VEPs because firms are less likely to distinguish themselves through beyond-compliance VEPs [14]. ...
... Studies have found that stringency of government regulations influences firms' motivations to sponsor VEPs [14]. On the one hand, more stringent and strictly enforced regulations reduce incentives for VEPs because firms are less likely to distinguish themselves through beyond-compliance VEPs [14]. On the other hand, the threat of regulation can prompt firms to enter into a VEP, especially when associated costs of VEP are lower than regulatory compliance costs [15,16]. ...
Article
Utility voluntary green power programs that allow energy consumers to pay a premium for electricity generated from renewable energy sources have gained great momentum worldwide in recent years. While there is growing literature examining customer behaviors related to green power purchases, limited work has been done to systematically evaluate the efficacy of voluntary green power programs implemented in conjunction with government-led renewable energy policies. In this research, we construct an innovative panel dataset on voluntary green power programs in 49 U S. states and Washington, D.C. from 2001 to 2013, with the goal to understand factors influencing total sales and customers of voluntary green power programs. Hybrid random effects regression models are estimated to investigate the impact of state renewable portfolio standards (RPSs) on the performance of voluntary green power markets. We find that for a given state, an increase in RPS policy stringency by one unit would lead to a reduction of green power program customer enrollment by 12.37%, and a reduction in green power program sales by 12.98%. Our results suggest that the competing effect is dominant between the voluntary green power market and the renewable energy regulatory regime: state RPSs tend to crowd out cheap renewable-sourced electricity that is available for sale through utility green power programs.
... VEPs seek to improve environmental outcomes by encouraging rather than mandating their participants to adopt better practices. If they become widely diffused, they can also create mimetic and normative pressures on other firms to follow suit (Prakash & Potoski, 2012). Their emergence coincides with the industry's view that traditional command and control environmental regulations are costly and inefficient "one-size-fits-all" prescriptions that stifle environmental and technological innovation, as well as efforts by governments to reduce their own monitoring and compliance costs (Rivera & de Leon, 2008). ...
... AVEP's stringency is a function of its governance design (Berchicci & King, 2007;Darnall & Carmin, 2005;Prakash & Potoski, 2012). Governance design refers to the set of criteria or rules that VEPs institute to induce participating firms to meet their objectives (Borck & Coglianese, 2009). ...
Article
We meta-analyze research on why firms join voluntary environmental programs (VEP) to assess the impact of program stringency, or the extent to which they have rigorous, enforceable standards on these decisions. Stringency creates trade-offs for firms by impacting programs’ effectiveness, legitimacy, and adoption costs. Most research consider singular programs and lack cross program variation needed to analyze program stringency’s impact. Our meta-analysis addresses this by sampling 127 studies and 23 VEPs. We begin by identifying common institutional and resource-based drivers of participation in the literature, and then analyze how program stringency moderates their impacts. Our results suggest that strictly governed VEPs encourage participation among highly visible and profitable firms, and discourage it when informal institutional pressures are higher, and firms have prior experience with other VEPs or quality management standards. We demonstrate that VEP stringency has nuanced effects on firm participation based on the institutional and resource-based factors facing them.
... VEPs seek to improve environmental outcomes by encouraging rather than mandating their participants to adopt better practices. If they become widely diffused, they can also create mimetic and normative pressures on other firms to follow suit (Prakash & Potoski, 2012). Their emergence coincides with the industry's view that traditional command and control environmental regulations are costly and inefficient "one-size-fits-all" prescriptions that stifle environmental and technological innovation, as well as efforts by governments to reduce their own monitoring and compliance costs (Rivera & de Leon, 2008). ...
... AVEP's stringency is a function of its governance design (Berchicci & King, 2007;Darnall & Carmin, 2005;Prakash & Potoski, 2012). Governance design refers to the set of criteria or rules that VEPs institute to induce participating firms to meet their objectives (Borck & Coglianese, 2009). ...
... According to Prokopovych (2010), ISO 14000 certification, a standard for handling environmental issues, is an illustration that voluntary programs are examples of club goods. The anticipation of enjoying voluntary program benefits, especially those involving good reputation, may motivate an organization to participate in the activity that will be of benefit to the public, such as environmental sustainability (Prakash & Potoski, 2012). Club theory does not set the rules of engagement in managing environmental risks, it, however, specifies what an organization can do and what it can gain by belonging to a voluntary program. ...
... In contrast with the state laws where there is capability of state agencies to coerce firms to obey, execution of a voluntary initiative"s principles is not readily observable. It is this inability of the public to verify what the voluntary initiatives claim to be doing that makes some raise doubts on the integrity and accountability of non-governmental private initiatives (Prakash & Potoski, 2012). The EPs regime, as is currently xx B. E. A OGHOJAFOR, S. A. ADULOJU is, seems to lack the power to coerce members to implement the principles and the authority to follow up compliance (Aboutorabifard, 2016), hence its low attractiveness to many institutions. ...
Article
Due to the growing level of dissatisfaction with the traditional models of governance established by the state, international governance initiatives have attracted more attention. This exploratory study is aimed at finding out the level of awareness and adoption of one such initiative, the Equator Principles (EPs), by banks in Nigeria. These principles were said to represent a good standard where environmental and social risks inherent in development projects can be identified, assessed and managed. The study was anchored on two theories: The club theory and the theory of institutional isomorphism. The survey data were gathered from 124 managers of the leading 10 deposit money banks in Nigeria. Data were analyzed using descriptive statistics presented in frequency tables and percentages. The findings show a high level of awareness of the EPs among the banks in Nigeria, but a low level of adoption. Although, the study is limited by a small sample, it offers evidence that difficulties in measurability of benefits of adopting Equator Principles and lack of enforcements of sanctions for noncompliance seriously limit the number of financial institutions adopting the regime in Nigeria.
... Environmental 1 3 regulations are a set of mandatory or voluntary environmental behaviors which imposed by governments or economic organizations (López-camere et al. 2010;Kwok et al. 2017). Mandatory environmental regulations (MERs) are labeled as commanding and controlling regulations because they command firms to reduce the emissions of pollutants and control how the firms did it through advanced technologies and relevant policies (Prakash and Potoski 2011;Zhao et al. 2015;Xu et al. 2016). Voluntary environmental programs (VEPs) are to induce program participants to establish a written environmental rule, document their environmental management systems, specify quantifiable targets and implement program schedule monitoring (Lim and Prakash 2014). ...
... VEPs are considered as useful supplement to MERs (Alberini and Segerson 2002;Khanna and Damon 1999). MERs provide the inflexibility of pollution regulation, which seems less appropriate for environmental challenges (Prakash and Potoski 2011). VEPs allow firms with greater latitude across programs in the market for environmental protection (Blackman et al. 2010;Picard 2015). ...
Article
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There is a long-lasting debate on whether environmental regulation fosters or hinders corporate green innovation. To address this debate, this study differentiates two types of regulations: mandatory environmental regulations (MERs) and voluntary environmental programs (VEPs), and explores whether MERs and VEPs, separately and jointly, affects corporate green innovation. This study also investigates the moderating effect of organizational slack on the focal relationship. With the data of top 100 listed companies in China, the results show that MERs significantly negatively affect green innovation, while VEPs significantly positively influence green innovation, and VEPs mitigate the negative impact of MERs on green innovation. Moreover, organizational slack strengthens the positive relationship between VEPs and green innovation, while no significant moderating effect on the MER–green innovation relationship. These findings provide guidance for corporate green innovation under mandatory regulations and voluntary programs.
... This approach involves voluntary participation in environmental regulation. Under this approach firms voluntary decrease their environmental impacts below the level required by law (Fiorino, 2006;Prakash and Potoski, 2012). ...
... There are several forms of these voluntary approaches, e.g., unilateral commitments made by polluters, private agreements between polluters and pollutes, negotiated agreements between a public authority and industry and voluntary programmes developed by public authorities (Prakash and Potoski, 2012;Bӧrkey et al., 1999;Brouhle et al., 2004;OECD, 2003). The use of voluntary approaches has spread dramatically since they were introduced at the beginning of 1990's. ...
Article
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We examine why firms voluntarily implement environmental management systems. Employing the ISO 14001 management system and using firm-level data for the Czech Republic, we find that environmental management systems are typically adopted by large firms and by those firms that initially pollute the environment more. These systems are more commonly implemented by firms operating in service industries. On the other hand, we find little support that the adoption of environmental management systems is influenced by the firm’s financial performance and labor costs.
... Voluntary Environmental Programs (VEPs) motivate organizations to produce environmentally friendly products beyond the requirements by the government. Prakash and Potoski (2012) discussed the challenges faced by VEPs. First, VEPs should have sufficient excludable incentives for the firms to join them. ...
... These organizations are sometime called for discussion over environmental issues on various platforms that provide them greener brand image. Prakash and Potoski (2012) examined conditions under which VEPs emerge and improve environmental performance. The article focusses on costs and benefits for actors seeking to provide these governance mechanisms and also on costs and benefits for firms who are joining VEPs and sticking to their obligations. ...
Book
This book examines the Indian mandate for Corporate Social Responsibility (CSR) and its implementations in various individual organizations. Although the mandate is applicable only to certain large and stable companies, many believe that India is poised to become the birthplace of social, economic and environmental transformation, given the immense size of the Indian population and its challenging socio-economic index. The book explores the various facets of CSR investigation and places special emphasis on the Schedule VII of the Indian Companies Act of 2013, which defines specific areas of intervention for these companies. In addition, it provides a wealth of first-hand case studies that exemplify the ongoing developments and the fundamental challenges and opportunities of mandated CSR.
... These findings are partly contrary to previous research, which suggest that a low or weak regulative setting motivates voluntary initiatives and that strong regulation does not (Prakash & Potoski, 2012) or that welfare states deploy more mandated CSR measures while regulatory states opt for voluntariness (Brejnholt, Rintamaki, Schnyder, & Svystunova, 2020). Rather, in this study, the strong welfare state promotes purely voluntary initiatives, whereas in the low regulation context, the aim is to develop an MSI that resembles law. ...
Thesis
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This PhD thesis examines the boundaries of deliberation and how rights and responsibilities are divided between corporations, nation states, and civil society. As globalisation has integrated economies, and accelerated information exchange, it has also arguably restructured the division of responsibilities between state, market and society. In this world of continuously negotiated public and private interests, and multi-layered governance, how are hegemonies built, maintained or contested? Natural resource governance in general and mining conflicts in particular offer a fruitful context in which to explore governance and conflict dynamics in management research as they link the often overlooked role of the state within the discussion on corporate–civil society relations. Drawing from political theory and political ecology literatures this research contributes to our understanding of governance gaps and the political role of corporations. It describes the political complexities that underlie state – corporate interactions, and the possibilities and shortcomings of private governance in replacing public forms of governance. The research unearths how different historico-political trajectories influence governance regimes, and how governance mechanisms emerge in different spheres of statehood – namely political, administrative and judicial. The research contributes to deliberative management literature by discussing the challenges in securing the basic tenets of participation and equality, and allowing for contestation, dissensus and conflict as part of the process. The three articles of the PhD thesis examine different aspects of the governance interactions between public and private actors. The first paper investigates the differences of civil society actors as rightsholders and stakeholders in public and private governance, and how those roles, in turn, influence governance outcomes. The second paper discusses the various roles of statehood in multi-stakeholder governance, and how governments deploy these new governance regimes for their political purposes. Advancing prior research on layered governance and public–private interactions, this paper demonstrates how the expectations and roles of the state transfer into multi-stakeholder initiatives. Thus, it is not only the government that steer the initiatives directly or indirectly, but the embeddedness of administrative and judicial spheres in MSIs that impact these governance constellations. The third paper examines the case of a mining project called Sakatti in northern Finland through an ethnographic approach. It takes a micro-level perspective and examines the power of place and place-based identities in corporate–community dialogue. Local values, meanings and knowledge are connected to persuasion and control through dialogue, and place is actively mobilised as a resource by both the company, and those who are opposed to the mining project. Place-basedness becomes an important frame for managing dissensus, contesting hegemony and silencing resistance. Together all these articles contribute to the theorisation of the business–society interface and the broader discussion on the role of the state in assigning and sharing corporate responsibilities. Availabe at https://openaccess.city.ac.uk/id/eprint/28955/
... Environmental transparency and voluntary environmental standards turn into necessary conditions for managing relationships with stakeholders and attracting investments in environmentally sensitive markets ( Prakash and Potoski, 2012;Trumpp and Guenther, 2017). The rate of adoption of voluntary standards varies across economic sectors and industries ( Shvarts et al., 2016;Delgado-Márquez and Pedauga, 2017). ...
Chapter
Environmental transparency became a necessary condition for managing relationships with stakeholders and attracting investments for extractive industries. The changing competitive environment and stakeholder demands are pushing oil and gas companies from various countries to disclose additional information on environmental management and environmental impact. Nevertheless, the level of environmental transparency of oil and gas companies still differs. Our study aims to assess the transparency of the world's largest oil and gas companies in terms of the availability of environmental data. We build this research on our successful experiences in the national environmental transparency ratings for Russia, Kazakhstan, and Azerbaijan. Our sample includes 32 oil and gas companies, global leaders in terms of daily production of liquid hydrocarbons (oil and gas condensate). When assessing environmental transparency, we take into account only information published on corporate websites, in non-financial reporting, and other accessible public resources. Our analysis shows some regional patterns in the distribution of companies: high transparency is most typical for European, American, and Russian companies, while companies from Asia and Africa tend to be less transparent from the environmental point of view. Keywords: environmental transparency, oil and gas companies, environmental management, environmental impact, non-financial reporting, environmental data.
... This helps the government in its work towards achieving tangible policy results. As per Prakash and Potoski (2012), such a loss can be as high as a quarter of an enterprise's business income, so a loss of R 3 ¼ 2:5 is assumed. ...
Article
Political blue sky is unsustainable because conflicting interests in China's fragmented authoritarianism (FA) lead to the failure of air pollution regulations. This study explores how to transform China's political blue sky from short‐term fabrication to long‐term consolidation by effective environmental regulations. A two‐pronged mechanism design in the non‐cooperative tripartite evolutionary game is employed to model the dynamic cost–benefit strategy interactions among the central government, local governments, and polluting enterprises for sustainable air pollution control. Policy simulations are conducted to examine the effectiveness of several environmental regulation instruments for leading to the ideal outcome. In baseline scenarios, proper coordination of environmental inspection, vertical and horizontal transfers, and environmental taxation can impel the game to converge to the desired evolutionary equilibrium. In extended scenarios, three long‐term oriented inspirations—double‐dividend effect of environmental tax revenues, public monitoring, and the Porter hypothesis effect of environmental regulations—can improve the efficiency of environmental regulations compared to baseline scenarios. From a methodology perspective, policy simulation in an evolutionary game framework provides a novel addition to the research toolkit for addressing FA.
... The current (2020) Agreement includes private and confidential compensation schemes for satisfactory performance, essentially forming a voluntary environmental program (VEP) designed to induce positive environmental externalities beyond the requirements of government legislation [68]. Funds provided to KNAPK are earmarked for distribution among Greenlandic fishers to invest in equipment or gear for targeting species other than salmon. ...
Article
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Inter-organizational collaboration is often considered essential to transboundary fishery governance, due, in part, to the high levels of task interdependence, the remote and often treacherous conditions, and the limited levels of information available to any policy actor on resource status. In the high seas, Regional Fisheries Management Organizations (RFMOs) are responsible for sustainably managing highly migratory and straddling fish stocks through the implementation of ecosystem-based approaches and ensuring adequate inter-jurisdictional cooperation. A central question facing RFMO governance is therefore how to structure and sustain inter-organizational transboundary collaboration under high uncertainty? This paper presents the case of the North Atlantic Salmon Conservation Organization (NASCO), conceptualized as a strategic alliance between the bureaucratic organizations responsible for north Atlantic salmon fishery management in the member countries. We identify and explain how dimensions of trust, control, and perceived risk have structured the collaborative performance of the alliance. The application of an integrated trust-control-risk framework increases conceptual clarity for how, when and why alliance managers might seek to develop different forms of trust through different management control systems in ways that further multi-actor collaborative network performance. Future research needs are identified, including better understanding how managerial strategies and control mechanisms facilitate inter-organizational trust in transboundary governance settings and mitigate the perceived risks of working together.
... The type (or class) of governance alternatives embraced by cities has been captured by a variety of terms. These terms include New Environmental Governance (NEG)(Holley, Gunningham, & Shearing, 2012), New Environmental Policy Instruments (NEPI)(Jordan, Wurzel, & Zito, 2013), Non-State Market Driven governance (NSDM)(Cashore, Auld, & Newsom, 2004), Voluntary Environmental Programs (VEP)(Prakash & Potoski, 2012), New Urban Governance (NUG)(Bingham, 2006), and Voluntary Environmental Governance Arrangements (VEGA) (Van der Heijden, 2012). ...
Article
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Around the world, cities have committed themselves to urban climate action strategies with targets that go beyond those of their national governments. To implement their strategies, cities have embraced a range of alternative governance instruments and approaches (‘governance alternatives’). While they have long been lauded by academics, policymakers, and practitioners for doing so, these ‘frontrunner’ cities are now being seen to struggle to achieve their ambitious targets when using governance alternatives. This article seeks to unpack and better understand this struggle by zooming in on the progress made in reducing (non-renewable) energy consumption in the built environment of three major cities in the United States (Chicago, New York, and San Francisco) over the last decade. Informed by interviews and supplementary data, the article uncovers a pattern across these three cities. In the early 2000s, they all set ambitious urban climate change targets, but lacked the power and capacity to achieve these. They all used a largely uncoordinated ‘scattergun approach’, embracing a broad set of (at best) modestly ambitious and (regularly) opportunistic governance alternatives to achieve the aims of their ambitious strategies. Whilst this approach allowed the cities to obtain quick initial results, the resulting fragmented configuration of traditional and alternative governance instruments and approaches now hinders them from meeting their targets.
... Some industries choose to adopt voluntary environmental standards, which they believe will increase their competitive advantage in environmentally sensitive markets and afford access to longer-term and more affordable sources of finance (Prakash and Potoski, 2012;Delgado-Márquez, Pedauga, 2017;Trumpp, Guenther, 2017). This has led to increased environmental standards of companies whose exports are orientated towards environmentally sensitive and socially responsible markets, and sometimes even a decline in the role and importance of state national regulations, especially in cases where state national regulation standards are lower than international requirements. ...
Article
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This article examines the current state and drivers of environmental transparency in the Russian Mining and Metals sector. The study is based upon 2016–19 successive annual rankings calculated transparently, using publicly available information and a third-party-verified ranking system. Ranking results reveal a definite in-crease in the transparency level of one of the most closed industries in Russia. The findings from the study show that a company’s presence in the stock markets has a positive impact on its openness in environmental matters. However, a company’s listing on an international stock exchange does not guarantee high environmental transparency. Some evidence of a correlation between ranking positions and participation of diversified financial-industrial groups in the share capital was also found. Overall, our analyses suggest that ESG (envi-ronmental, social and governance) management in the Russian mining and metals sector is only in the process of development. To overcome this, the environmental transparency ranking of mining and metals companies in Russia creates a new mechanism for raising public awareness and dialogue between the public and one of the most closed industries. The ranking initiated calculation of industry-average quantitative impact indicators that, as the sample grows, will transform into an important benchmark for corporate self-assessment when comparing Russian practices with those of the largest international and foreign mining and metal companies across the globe
... If a low-ranked company is investigated by the authorities or journalists, or sued by someone over an environmental issue, its low rank might put the company at a disadvantage, in terms of both legal processes and public relations. It is also theoretically possible that a company's rank may also influence its access to capital (Prakash & Potoski, 2012;Shvarts et al., 2016;Trumpp & Guenther, 2017). The petroleum and mining industries may be in particular need of such rankings, as the number of voluntary sustainability initiatives in the extractives sector grows, while their effectiveness is increasingly being questioned and scrutinized (MacInnes, Colchester, & Whitmore, 2017;Potts et al., 2018;Ranängen & Zobel, 2014). ...
Article
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The Arctic Environmental Responsibility Index (AERI) covers 120 oil, gas, and mining companies involved in resource extraction north of the Arctic Circle in Alaska, Canada, Greenland, Finland, Norway, Russia, and Sweden. It is based on an international expert perception survey among 173 members of the International Panel on Arctic Environmental Responsibility (IPAER), whose input is processed using segmented string relative ranking (SSRR) methodology. Equinor, Total, Aker BP, ConocoPhillips, and BP are seen as the most environmentally responsible companies, whereas Dalmorneftegeophysica, Zarubejneft, ERIELL, First Ore‐Mining Company, and Stroygaz Consulting are seen as the least environmentally responsible. Companies operating in Alaska have the highest average rank, whereas those operating in Russia have the lowest average rank. Larger companies tend to rank higher than smaller companies, state‐controlled companies rank higher than privately controlled companies, and oil and gas companies higher than mining companies. The creation of AERI demonstrates that SSRR is a low‐cost way to overcome the challenge of indexing environmental performance and contributing to environmental governance across disparate industrial sectors and states with divergent environmental standards and legal and political systems.
... Обязательные нормативные требования отражают в основном средний уровень рынка и не позволяют компаниям минимизировать затраты на соответствие стандартам экологической ответственности. Для усиления их конкурентных преимуществ на экологически чувствительных рынках компании выбирают принятие добровольных экологических стандартов [4,5]. Однако нефтегазовая отрасль еще несколько лет назад была одной из наиболее «закрытых» отраслей российской экономики, мало чувствительной к требованиям в области экологической ответственности и прозрачности [6]. ...
Article
The article is a continuation of several publications by the authors in the journal "Issues of Risk Analysis". It is aimed at identifying the dynamics of environmental responsibility of oil and gas industry facilities in the Russian Arctic using the rating approach for 2014—2019. The results of the rating analysis revealed the general and differentiated dynamics of greening of the Arctic oil and gas sector enterprises in three sections: management, operational and information. The leaders of the environmental rating were identified: Sakhalin energy (Sakhalin-2), LUKOIL, Gazprom, and Zarubezhneft.
... Participating in a government environmental program can be viewed as a signal sent by firms to communicate their proactiveness in protecting the environment with stakeholders (Prakash & Potoski, 2012). In particular, the signal explicitly conveys two messages. ...
Article
Firms implement proactive environmental practices (PEPs), and governments in developing countries such as China implement environmental policies such as pilot and demonstration programs to promote these PEPs. However, it remains unclear whether and when firms recognized by such governmental programs improve financial performance. Using a sample of 233 firms recognized by a national Chinese government environmental program, event study is employed to estimate stock market reaction of recognized firms. The Heckman two‐stage procedure is followed to examine the moderating effects. We find that the average stock market reaction is not significant. Cross‐sectional analyses indicate that firms with earlier recognitions, recognized for demonstration projects (compared with pilot ones), and operating in more‐polluting industries have greater market reactions, while types of PEPs (internal versus external), export intensity and government ownership (state‐owned or not) do not moderate the market reaction. This paper provides implications for firms about whether and when they should participate in a government environmental program.
... Marketing researchers have examined consumer adoption of green products and the marketing of sustainable business initiatives(Collins et al., 2007;Gordon, Carrigan, & Hastings, 2011;Jansson et al., 2010;Nath, Kumar, Agrawal, Gautam, & Sharma, 2013). Business economists have analyzed regulatory mechanisms, such as voluntary programs that act as information diffusion programs(Lyon & Maxwell, 2007;Prakash & Potoski, 2012). Management researchers have examined antecedents of an organization's environmental management activities(Banerjee, Iyer, & Kashyap, 2003;Hofer, Cantor, & Dai, 2012) and have published research reviews and critiques(Dyllick & Muff, 2016;Salzmann, Ionescu-Somers, & Steger, 2005). ...
Thesis
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This doctoral thesis consists of six research papers presented in Chapters II, III, and IV and thereby contributes to scientific knowledge in Green IS and ICT4D research. The included six research papers address topics and questions on an individual, organizational, and societal level. As such, presented models and approaches investigate how to contribute to sustainability issues occurring on all three levels. As sustainability will continue to play an essential role in the upcoming years, this doctoral thesis hopefully provides valuable theoretical and practical insights.
... Successful examples include farmland soil conservation efforts in the United States (Genskow and Wood, 2009;Segerson, 2013b), establishment of farmland wildlife habitat (Best et al., 1997;Pabian et al., 2013), improved forest habitat management (Kauneckis and York, 2009;Steelman and Rivera, 2006), sage grouse (Centrocercus urophasianusas) conservation and habitat management (Copeland et al., 2013;Wollstein and Davis, 2017), and sustainability of marine fisheries (Lent and Squires, 2017;Segerson, 2010). However, if voluntary programs are to be used for mitigating wildlife lead poisoning, thoughtful design, implementation, and monitoring will be necessary (Alberini and Segerson, 2002;Prakash and Potoski, 2012;Rice and Atkin, 2013). ...
Article
Wildlife and human health are at risk of lead exposure from spent hunting ammunition. Lead exposure persists for bald eagles due to bullet fragments in game animal gut piles and unretrieved carcasses, and is also a human health risk when wild game is procured using lead ammunition. Programs encouraging the voluntary use of nonlead ammunition have become a popular approach mitigating these effects. This study explored attitudes and experiences of United States Fish and Wildlife Service (USFWS) staff implementing an outreach program encouraging deer hunters to voluntary use nonlead ammunition on 54 National Wildlife Refuges (NWRs) in the Upper Midwest, U.S. to understand factors affecting program implementation. We conducted 29 semi-structured interviews of USFWS staff along with 60 responses from an open-ended survey question. Twelve themes emerged from the data and were grouped into three broad categories: (1) challenges of dealing with complex issues, (2) importance of messengers and messages, and (3) resistance from staff. Challenges of dealing with complex issues included administrative restraint and uncertainty, scope and scale of program, human health not an agency responsibility, contextual political influences, and public-private collaborations. Importance of messengers and messages included the importance of experience, and salience of human health risk. Finally, resistance from staff included skepticism of the science and motives behind the program, competing priorities for refuge staff, differing perceptions of regulatory and voluntary approaches, cost and availability of nonlead ammunition, and disregard by some about lead ammunition and human health risks. Staff identified numerous challenges implementing the program, many of which were external factors beyond the control of the participants. Understanding the factors affecting program implementation may help guide future efforts encouraging the voluntary use of nonlead ammunition.
... Additionally, firms are only able to gain a competitive advantage when they build internal capabilities that align their implementation with a clear communication strategy with stakeholders [77]. The eco-innovation literature suggests that environmental management systems generally prove to be effective in strengthening eco-innovation capability and environmental performance, through facilitating environmental target setting and stimulating information flows [78][79][80][81][82]. ...
Article
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This study examines the influence of eco-innovation capability on sustainability driven innovation practices in SMEs. In this study, eco-innovation capability is represented by four factors—internal setting, strategies, operations and structure—while sustainability driven innovation practices are represented by three types of practices—process, organizational and product. The direct relationship between eco-innovation capability and sustainability driven innovation practices is statistically tested by using a sample of 397 Romanian manufacturing small and medium-sized enterprises using PLS–SEM and SmartPLS software. The results show that the development of eco-innovation capability has a direct and positive effect on sustainability driven innovation practices employed in manufacturing SMEs by encouraging them to get involved in cleaner production practices, waste handling and recycling on a regular basis or integrate eco-efficiency into their operations, develop new channels for sustainable products or integrate customers’ suggestions or complaints, implement environment management systems, use eco-friendly raw materials or focus on new product development, for instance. Therefore, the paper extends the literature dedicated to eco-innovation by shedding some light on what to focus on when building eco-innovation capability.
... First, evidence from comparative investigations highlights divergence in regulatory goals, design, and implementation means. As Prakash and Potoski (2012) concludes, the emergence of voluntary environmental regulation across countries could be attributed to variations in the existing configurations of policy instruments, political institutions, and political culture. VEPs differ not only in design and requirements but also in brand values as perceived by regulated firms. ...
Article
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There has been growing complexity in the study of environmental regulatory governance. In terms of regulatory approaches, the focus of national styles has gradually shifted to the local level, down to street-level regulators. As for compliance strategies, regulated entities, particularly enterprises, have moved their strategies from the evasion-compliance dichotomy to more progressive ones that are beyond compliance. As environmental watchdogs on behalf of civil society, ENGOs, particularly those in developing and non-democratic political settings, have increasingly found more space for strategizing their active efforts to monitor enforcement agencies and polluting enterprises in the regulatory process. The spilling of regulatory regimes into developing countries has led to an urgent need for regulatory studies in such nations, with a call for new theoretical formulations that are capable of explaining regulatory governance in those countries. Research methodologies adopted have become increasingly sophisticated, moving from using a single method to using mixed methods by integrating qualitative and quantitative ones, with longitudinal studies and panel data analysis as the recent trends. This study aspires to perform a critical review of the existing body of literature on environmental regulatory governance in these major aspects as the basis for a research agenda setting.
... Marketing researchers have examined consumer adoption of green products and the marketing of sustainable business initiatives ( Collins et al. 2007;Gordon et al. 2011;Jansson et al. 2010;Nath et al. 2013). Business economists have analyzed regulatory mechanisms, such as voluntary programs that act as information diffusion programs ( Lyon and Maxwell 2007;Prakash and Potoski 2012). Management researchers have examined antecedents of an organization's environmental management activities ( Banerjee et al. 2003;Hofer et al. 2012) and have published research reviews and critiques (Dyllick and Muff 2016;Salzmann et al. 2005). ...
Article
Acknowledging sustainability as a challenge of utmost importance, organizations face questions on dealing with different dimensions of sustainability. Respective actions include a fundamental shift in the purpose of business and almost every aspect of how it is conducted, or in short: an integration of sustainability in organizations’ business model. However, as sustainability is no altruistic end in itself, respective transformation must resonate with organizations’ economic conditions and their position in the market. But when does it pay off for organizations to integrate sustainability in their business model? Within this research paper we find answers by applying a game-theoretic framework and examining competition strategies for organizations integrating sustainability in their business model. Hereby we consider different market scenarios where symmetric and asymmetric, weak and strong, as well as a varying number of organizations interact. Our results suggest different strategies organizations can apply to gain competitive advantage.
... 1. Government policies and regulations: government legislations, policies, regulations and directives play a vital role in driving positive environmental behaviour, e.g., fuel prices, taxes, subsidies 2. Competition or competitive pressure: in order to gain competitive advantage, many organisations incorporate CER initiatives into their business. 3. The media and public awareness: The media according to Robecosam (2013) 1. Regulatory and compliance cost: regulatory and compliance cost as explained by Prakash and Potoski (2012) is something with both positive and negative externalities which makes it difficult for organization to development of environmental initiatives. For example, some organisations would want to adopt new technologies to reduce the environmental impact of their business activities but the imposing costs can deter these organisations overall implementations. ...
Article
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The study investigated the perception of Choba youths towards corporate environmental responsibility of Confectionary Companies in Choba Community. Four research questions guided the study. The researcher adopted descriptive design and the population of the study comprised 50 members of Choba youth organization, and the researcher purposively sampled the entire population. The instrument used for collection of data is a validated researcher made twenty items questionnaire with a reliability index of 0.78. Findings revealed that confectionary companies operating in Choba negatively impact on the host community environment; they are not environmentally responsible to their host community and that government also has not been actively intervening much in the area of checkmating the excessiveness of the company's actions. Based on the findings, the researcher recommended that these companies should device mechanisms for helping the community members whose sources of livelihood have been damaged by the companies' production processes, and that government should intensify effort toward enforcement of the companies to be environmentally responsible.
... 1. Government policies and regulations: government legislations, policies, regulations and directives play a vital role in driving positive environmental behaviour, e.g., fuel prices, taxes, subsidies 2. Competition or competitive pressure: in order to gain competitive advantage, many organisations incorporate CER initiatives into their business. 3. The media and public awareness: The media according to Robecosam (2013) 1. Regulatory and compliance cost: regulatory and compliance cost as explained by Prakash and Potoski (2012) is something with both positive and negative externalities which makes it difficult for organization to development of environmental initiatives. For example, some organisations would want to adopt new technologies to reduce the environmental impact of their business activities but the imposing costs can deter these organisations overall implementations. ...
Article
Full-text available
The study investigated the perception of Choba youths towards corporate environmental responsibility of Confectionary Companies in Choba Community. Four research questions guided the study. The researcher adopted descriptive design and the population of the study comprised 50 members of Choba youth organization, and the researcher purposively sampled the entire population. The instrument used for collection of data is a validated researcher made twenty items questionnaire with a reliability index of 0.78. Findings revealed that confectionary companies operating in Choba negatively impact on the host community environment; they are not environmentally responsible to their host community and that government also has not been actively intervening much in the area of checkmating the excessiveness of the company's actions. Based on the findings, the researcher recommended that these companies should device mechanisms for helping the community members whose sources of livelihood have been damaged by the companies' production processes, and that government should intensify effort toward enforcement of the companies to be environmentally responsible.
Article
Can green states exist in a non-Western context? Much research has been focused on environmental politics in advanced industrialized economies, and the associated institutions, policy, and resources available for environmental protection efforts. Outside this narrow context however, we know far less about the progress states have made in developing their national systems of environmental governance. This gap in our understanding is particularly evident when it comes to the post-Soviet context. Using a case study of Georgia, this analysis evaluates environmental governance capacity in a transition state drawing on a framework derived from the green state literature. Since the collapse of the Soviet Union in 1991, Georgia has faced considerable political and economic upheaval, and in the midst of it all, the country has embarked on an ambitious program of environmental reform. The findings suggest that while the basic internal foundations of a green state exist, including considerable policy and legislative development and solid environmental financing, key challenges remain. These are centered on an unstable institutional environment, and weak policy enforcement. However non-state actors such as NGOs and international organizations provide crucial support and are likely to remain essential in building and maintaining environmental capacity in the future.
Article
Voluntary environmental management research has become a popular topic over the past two decades. This paper collects 3342 articles on research of voluntary environmental management in the Web of Science core database and uses the CitespaceV software to perform knowledge map analysis in this field. The results show: (1) in the field of corporate voluntary environmental management research, American universities are still playing a dominant role, but the number of Chinese scholars' publications has increased rapidly in recent years; (2) cluster analysis of the co-cited literature shows that sustainability reports, comparisons of voluntary environmental projects, managerial perceptions, voluntary management standards, environmental practices, industry self-regulation, environmental governance, and responsibility reporting are popular topics in the field of voluntary environmental management; (3) from the perspective of hotspot development, the early research mainly focused on industry self-regulation and environmental governance. In the early twenty-first century, the hotspots were mainly concentrated on comparisons of voluntary environmental projects, managerial perceptions, voluntary management standards, and responsibility reporting. Currently, researchers pay more attention to related environmental performance, corporate performance, the construction of comprehensive models, and the choice of environmental information disclosure methods. Topics with significance for further study include the impact mechanisms of environmental management certification on environmental performance and green innovation, the motivations of enterprise environmental information disclosure, and enriching the existing environmental management theory.
Article
Food policies to foster a healthy lifestyle are to an increasing extent developed through processes of collaborative governance in which public and private stakeholders negotiate voluntary agreements (VAs). The effectiveness of these VAs has been questioned repeatedly, because of the involvement of the food industry in drawing up these agreements. In this article I further develop insights into food industry influence in collaborative governance through an in-depth analysis of negotiations on the Dutch prevention agreement on overweight which was concluded in 2018. Using documents obtained through a Freedom of Information request I show how the food industry succeeded in shifting the regulatory arena towards a collaborative governance set up that allowed them to co-design and propose appropriate measures. Secondly, in this arena the industry managed to weaken and modify most of the measures for which it would be responsible. Finally, the industry used backstage lobbying outside of the official arena to block a plan to introduce a sugar levy. The case study confirms the weakness of voluntary agreements as an alternative to public regulation. This weakness results from the food industry’s ability to capture collaborative governance processes and combine these with behind the scenes lobbying tactics. Policy-makers should therefore seriously reconsider the use of VAs for public health policies and governments should empower themselves to make a better use of public regulation both at national and EU level.
Article
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A new quantitative index to analyse the corporate social responsibility (CSR) level of mine sites was developed, providing an easy and friendly tool to analyse and apply a continuous improvement approach to CSR levels, being able to involve all the potential stakeholders. The index can be used in any type of project and stage: prospecting and exploration, development, mining, processing, closure and rehabilitation. The system consists of two dimensions, environment and socioeconomic, formed by 30 elements that analyse potential positive and negative impacts. Moreover, it can be adapted to the specific characteristics of any mining activity, including new elements if necessary. The system proposed can help to improve the positive implications of the mining industry, as well as improving transparency or stakeholder engagement and returns of the mining activity.
Article
Reasonably designing environmental regulations for compliance-driven industrial relocation can avoid new pollution havens. The Cournot duopoly model simulates that the necessary condition for industrial relocation is differentiated market costs. Then, based on the province-industrial data of six Chinese pollution-intensive industries during 2005–2019, this study applies spatial Durbin model to explore the non-linear effects of heterogeneous environmental regulations on industrial relocation. Results shown that command-and-control environmental regulation manifests a U-shaped curve with local industrial relocation, with inverted U-shaped spillover effect radiating a road distance of 650 km, and both internal and external costs play the mediating roles; Market incentive environmental regulation has inverted U-shaped curves with industrial relocation in local and neighboring regions, it creates dual costs and works well in both short and long terms, which is the most potential regulatory tool to avoid pollution relocation accompanying industrial relocation; Voluntary environmental regulation exhibits inverted U-shaped relationships with industrial relocation in direct and spillover effects, and works through increased external cost rather than internal cost. Its spatial spillover radiates the longest 1250 km due to rapid spread of public opinions, but this effect takes more than 3 years to be effective.
Chapter
In diesem Beitrag untersuchen wir den Zusammenhang zwischen staatlicher Regulierung im Umweltschutz und der Umweltperformanz. Ausgehend von drei theoretischen Perspektiven, welche die Beziehung von Staat und Markt beim Umweltschutz unterschiedlich konzeptualisieren, identifizieren wir fünf Pfade, wie staatlicher Eingriff und Umweltperformanz miteinander verknüpft sein könnten. Wir untersuchen dann die empirische Relevanz dieser Pfade mit einer quantitativen Analyse, die 29 umweltpolitische Maßnahmen in für 37 Länder und den Zeitraum von 1970 bis 2010 umfasst. Dabei finden wir zumindest für einige Politikbereiche und einige Länder Hinweise, die auf eine Effektivität nationalstaatlicher Regulierung hinweisen. Zukünftige Forschung kann auf unserem Rahmen aufbauen, um weitere Hypothesen zum Policy-Outcome-Nexus zu generieren und zu testen.
Article
Significance Due to market and system failures, policies and programs at the local level are needed to accelerate the renewable energy transition. A voluntary environmental program (VEP), such as SolSmart, can encourage local governments to adopt solar-friendly best practices. Unlike previous research, this study uses a national sample, more recent data, and a matched control group for difference-in-differences estimation to quantify the causal impact of a VEP in the public, rather than private, sector. We offer empirical evidence that SolSmart increased installed solar capacity and, with less statistical significance, the number of solar installations. The results inform the design of sustainability-focused VEPs and future research to understand the causal pathways between local governments’ voluntary actions and solar market development.
Article
Unlike prior literature, this paper exploits heterogeneity in the substantive contents of firms’ voluntary carbon disclosure to estimate the impact of their participation in the CDP (formerly the Carbon Disclosure Project) on firms’ entity-wide carbon footprints. Heterogeneity in firms’ substantive contents of disclosures pertains to their level of climate mitigation activity, ranging from basic transparency to carbon management and to higher levels of climate action, such as third-party verification of entity-wide carbon emissions. This paper makes use of the U.S. Environmental Protection Agency’s introduction of the Clean Power Plan, which during 2011–2016 exerted regulatory pressure on GHG-intensive firms, and the interaction between regulatory pressure and corporate management, to model firms’ decision to participate in the CDP and their subsequent environmental performance. Results based on a difference-in-difference-in-differences estimator, nested in a two-stage endogenous binary-variable model, indicate that there is evidence of increases in total carbon emissions by firms that have instituted carbon management practices but did not certify their carbon disclosures with third-party audits, among other more advanced forms of carbon management. Despite this, by one measure of carbon emissions intensity, firms’ basic carbon transparency is linked to increased carbon efficiency. Sector regressions show that consumer-oriented sectors engaged in “cheap talk” by participating in voluntary carbon disclosure at high levels irrespective of their carbon footprints, whereas firms that were already carbon efficient in GHG-intensive sectors used their participation in the CDP to signal their climate leadership to regulators and other stakeholders. Findings are robust to alternative specifications and an alternative modeling approach.
Article
Corporate social responsibility is the balance between a firm's economic outcomes and environmental protection. However, investors face increasing difficulties in selecting assets with suitable environmental, social, and governance (ESG) policies because companies may “greenwash” their activities by, for example, make misleading ESG disclosures. Here, we investigate the determinants that lead to companies engaging in ESG greenwashing. By analyzing international large‐cap companies across 47 countries and territories, we create a peer‐relative greenwashing score to measure the magnitude of ESG greenwashing by companies. First, we measure and evaluate the greenwashing by analyzing ESG disclosures and creating peer‐relative performance scores that consider the level of disclosure and the real ESG performance. Second, we show that companies' greenwashing decisions are motivated by financial constraints and thus the financial environment is a determinant of greenwashing behavior. Third, we describe how intermediation can alleviate financial constraints and decrease greenwashing behavior. Moreover, highly leveraged companies may have increased financial pressure and thus may enhance their greenwashing behavior. Our findings are robust according to several different measurements of financial constraint indicators.
Article
Non-governmental organisations (NGOs) have the potential to combine social objectives with trading activities, while social reporting represents a tool for disclosing NGOs' peculiarities. Although the number of NGOs adopting social reporting is increasing, research is still lacking on the relationships between firms and NGOs and their impacts at the government level, at which policy makers must both favour social/environmental commitments and ensure that NGOs pursue their core objectives, also when carrying out trading activities. This paper investigates the challenges of policy making in this field by analysing NGOs in Italy, the first country to make social reporting compulsory. We randomly selected 20 social reports from the Italian NGO register to analyse eight components regarding the disclosure of their impact. The results show that a compulsory requirement leads to a paradox, given the trade-off between stakeholder engagement principles on the one hand and disciplinary power and accounting as action at a distance principles on the other, leading NGOs to account for their output rather than for their impact. We thus contribute to the literature about NGOs and corporate social responsibility (CSR), delineating the relevance of a paradox perspective. To the best of our knowledge, this is the only study to apply this perspective to the analysis of CSR and sustainable development trajectories in NGOs.
Article
Green development is a common goal pursued globally for carbon neutrality, and whether environmental regulatory system drives it in pollution-intensive industries (PIIs) is puzzled. Using provincial panel data of Chinese PIIs during 2005–2017, this paper applied entropy method to integrate existing environmental regulatory system into three types of environmental regulations, and then explored non-linear effects of them on green total factor productivity (GTFP). Several conclusions are generated. The annual growth rate of GTFP is 10.61% and it presents industrial differences. Technical change is the driving factor, while technical efficiency shows inhibiting effect. The effect of command-and-control environmental regulation on GTFP is a significant inverted U-shape curve, which is currently the primary driving role in green development, but it is too strict and increasingly less effective. Both market incentive and voluntary environmental regulations appear as positive U-shape curves, and their proper enhancement is breakthrough for future green development. Besides, market incentive environmental regulation is more effective in PIIs with relatively low pollution, while voluntary environmental regulation is sensitive to PIIs with relatively serious pollution. The Chinese government should allow environmental regulatory system more marketability and voluntariness, and production characteristics and pollution density of targeted industries should be considered.
Article
The increase in electric vehicles as a low‐carbon mobility option has driven interest from many workplaces and local governments to offer charging services for employees, customers and visitors. However, the lack of incentives to limit over‐consumption in shared charging resources has led to congestion issues. In this paper, we use high‐frequency data to study two deterrence mechanisms implemented at one of the largest workplace charging programs in the United States. We study both price and nonprice interventions that encourage adoption of workplace norms and charging etiquette for resource sharing in charging stations. To study these mechanisms, we use a dynamic regression discontinuity design to separately identify treatment effects with digital platform data. Our findings provide new evidence that group norms can play an important role in driving behavioral compliance when setting EV access policies. We also find that workplace norms are complements to dynamic pricing policies. We discuss the implications of this data discovery for the effective management of common pool resources in the context of workplace charging and space‐constrained environments. This article met the requirements for a gold‐gold JIE data openness badge described at http://jie.click/badges
Chapter
This chapter provides a more in-depth analysis of waste management policy. The prime focus is on countries in the European Union with some consideration of OECD countries. Of particular interest are approaches towards recycling waste, with special consideration of plastic waste. Plastic is particularly toxic in the environment and has become a ubiquitous problem across the globe. The relevance of the challenges of governance and leadership in multilevel systems in policy change are also outlined. The need to shift from voluntary to mandatory approaches is also outlined as necessary for policy action to establish more sustainable approaches to waste management.
Article
With rapid urbanization, environmental problems like green space shortage and urban flooding become prevalent. Identifying effective policymaking and implementation is critical in order to solve these problems. This dissertation addresses four theoretical topics in the context of urban green infrastructure: policy entrepreneur, institutional response to club goods, quasi-public-private partnership, and policy goal ambiguity. Each is exemplified by a causal case study. Data were collected through participant observation, field trips, semi-structured interviews, and crowdsourcing. Chapter 1 takes a longitudinal perspective and examines the dual role of policy entrepreneur and policy implementer in reaching the final policy goal of mandating vertical greening in the law in Shanghai (1992-2016). Usually, policy implementer and policy entrepreneur are two distinct identities and studied separately. This paper provides an unusual counterexample, exploring how the two intertwined identities may influence the entrepreneurial strategies and further influence the incremental policymaking process. Chapter 2 illustrates how government involvement may facilitate club-good development by investigating the nascent for-profit shopping mall roof garden (SMRG) development. SMRGs, established by developers to provide an amenity to mall customers, are in nature club goods. Although the government appreciates SMRGs given their positive externalities (e.g., recreation, stormwater mitigation), existing public policies fail to respond to SMRGs’ cross-sector nature, leaving significant financial, legitimacy, and oversight gaps unattended. The research suggests that government involvement can better facilitate club-goods’ sustainable development by creating an enabling institutional environment, which includes optimized policy design and coordinated cross-department collaboration. Chapter 3 focuses on the rarely studied phenomenon of the Quasi-Public Private Partnership (QPPP) in non-liberal societies. This work offers a general definition of Quasi-PPPs and identifies factors that influence the PPP to QPPP transition. In the case of eco-environmental service provision, the PPP-QPPP transition occurred in two stages. First, the eco-environmental service partnerships, initially established as PPPs, became inoperable with inexperienced partners and unsupportive markets. Second, with financial bailouts from the government, the private partner became a subordinated partner in a consortium between private partners and State-Owned Enterprises, and PPPs transitioned to QPPPs. In a non-liberal society, when the three critical PPP assumptions are violated (competent partners, supportive market, and horizontal partner structure), PPPs are more likely to transition to QPPPs. Chapter 4 examines how policy goal ambiguity influences policy implementation outcomes, exemplified by the Sponge City Program (SCP) implementation. SCP is a centrally-initiated program, requiring mainly the use of green instead of gray infrastructure to manage urban stormwater. When implemented top-down, three cross-level, layered goals of sustainability, stormwater management, and resident satisfaction became incoherent and vague in terms of priority and measurement. The research demonstrates that in a program with multiple policy goals, the goal priority ambiguity allows implementers the discretion to decide the order of goals to manage interest conflicts. Moreover, the goal measurement ambiguity allows implementers to decide the degree of their commitment to each goal, and to interpret the desired performance of a goal. Such ambiguity-caused discretions drastically inhibit the achievement of the sustainability policy goal.
Article
To clarify the drivers of environmental innovation, this study selected 50 independent samples from 49 publications to investigate the effects of four major factors—policy, market, resource capacity, and organizational characteristics—on environmental innovation using a meta‐analysis, as well as demonstrating the moderating role of cultural background and industrial diversity. The results show that both environmental regulations and government subsidies positively promote environmental innovation and that cultural background and industrial diversity do play moderating roles in how environmental regulations impact environmental innovation. Furthermore, customer demand is also shown to have a positive impact on environmental innovation and is moderated by industrial diversity. However, market concentration is not shown to significantly affect environmental innovation. The results also show that knowledge sources, technological capabilities, organization's performance, and environmental management systems positively influence environmental innovation. Additionally, cultural background plays a moderating role between an organization's performance and environmental innovation, and industrial diversity can moderate technological capability and environmental innovation. Finally, the size of an organization is shown to positively affect environmental innovation and is also moderated by cultural background.
Article
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Kehadiran penaatan sukarela (voluntary approach) di negara berkembang telah menjadi alternatif untuk mendorong penaatan hukum. Penaatan sukarela dapat menjadi pelengkap instrumen atur dan awasi (command and control), untuk mengatasi keterbatasan sumber daya dan minimnya kemauan politik pemerintah. Proper yang pada masa awalnya merupakan salah satu instrumen penaatan sukarela yang dapat mendorong ketaatan hukum pesertanya. Namun belakangan, Proper dikritik karena tidak memberikan sanksi terhadap pesertanya yang berperingkat tidak taat. Pada titik singgung ini, menjadi bias pemaknaan Proper antara konteks penaatan sukarela dan command and control.Artikel ini mengkaji secara normatif adanya dilema penerapan sanksi dalam Proper oleh KLHK selaku penyelenggara Proper. Dimana non-peserta Proper, cenderung mendapatkan keleluasaan akibat ketiadaan sistem pengawasan dan penegakan hukum. Sedangkan peserta Proper, yang secara sukarela telah bekerja sama untuk mempermudah pengawasan pemerintah, terancam sanksi apabila ditemukan pelanggaran. Sehingga apabila sanksi diterapkan terhadap peserta, dapat memberikan tekanan terhadap kesukarelaan peserta untuk melanjutkan kerja samanya dalam Proper.Kata Kunci: penaatan sukarela, penegakan hukum lingkungan, proper
Article
In the absence of a statutory instrument to enforce payment of a regulatory fee, regulators must rely on a combination of “carrots” and “sticks” to encourage financial contributions by the organizations they oversee. In contrast to studies of public funding of nonprofits, this article empirically evaluates the effectiveness of a government policy to rely on nonprofit funding of statutory regulation. The authors exploit a sharp discontinuity in the eligibility threshold for charities contributing to the new Fundraising Regulator in England and Wales to estimate a causal effect of the levy on participation. The article shows that the regulator's threat to “name and shame” was effective at incentivizing regulatory participation and generating income, but it raises some concerns about the long‐term viability of this approach. The results are significant at a time when many jurisdictions are considering how best to fund the regulation of nonprofits.
Article
The environmental, social, and governance (ESG) data provided in firms’ sustainability reports is often unaudited. If ESG information disclosed by firms is not reliable, a firm’s greenwashing behavior can be a barrier to integrating ESG factors into investment decisions. In this paper, we study mechanisms to lessen firms’ greenwashing behavior in ESG dimensions holistically. Firstly, we identify “greenwashers” as firms which seem very transparent and reveal large quantities of ESG data but perform poorly in ESG aspects. By creating peer-relative greenwashing scores for a cross-country dataset comprised by 1925 large-cap firms, we measure the extent to which large-cap firms engage in greenwashing. We find evidence that greenwashing behavior in ESG dimensions can be deterred by scrutiny from (a) independent directors, (b) institutional investors, (c) influential public interests via a less corrupted country system, and (d) being cross-listed. Our results suggest that the two firm-level governance factors are most effective at attenuating firms’ misleading disclosure relating to ESG dimensions.
Article
This paper establishes a multi theory framework to help explain factors and conditions promoting a political priority for policy change. The framework’s analytical utility is illustrated through its application to a case study of waste management in Australia. A lack of political momentum to prioritise regulatory interventions has contributed to uncoordinated responses by the Australian federal and state governments resulting in unsustainable approaches to waste management. Lessons are derived from the analysis that provide insights into the potential for establishing political priority for policy change from uncoordinated voluntary schemes to more coordinated regulatory approaches.
Chapter
Since recent past, a good number of organizations have voluntarily started accepting green practices to make contributions to the environmental well-being by reducing wastes, developing green products, constructing their buildings in the most efficient greener way, recycling their wastes into marketable products and many other ways to make themselves green. Consumers have started demanding for green products and companies are more than happy to satisfy their demand by producing environmentally friendly products. A quest to reduce cost had led to environmentally friendly innovation that has led to a “win-win situation” for all the stakeholders. By going green, companies are attracting more investors to fund them, which would have remained stagnant otherwise without any funds for expansion. In this article, we have examined the main drivers of Corporate Environmentalism (CE) on a global level such as market forces, government and civil regulations. The article discusses the relation between Corporate Environmentalism with stakeholder satisfaction and employee retention and found positive relations among them. Green firms also pressurize their suppliers and other stakeholders to engage in acts of corporate environmentalism to avoid the criticism of green wash. Corporate eco-efficiency brings the benefits of both economic prosperity and environmental protection and states that “A clean environment is actually good for business, for it connotes happy and healthy workers, profits for companies, developing conservation technologies, selling green product and efficiency in material usage”. The article also explains the environmentalism scenario in Indian subcontinent.
Article
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Voluntary environmental programs have the potential to impact not only participants but also non-participants, through, for example, the dissemination of information about abatement technologies, thereby creating spillover effects. Standard program evaluation techniques do not accurately estimate program impacts in such cases. This paper presents a theoretical and empirical analysis of spillovers in a VEP. The theoretical model identifies the key distinction between the impact of participation and the impact of the program, as well as the nature of the bias that results from failure to incorporate spillover effects. It also motivates the inclusion of spillovers in both the participation and outcome equations of the empirical model. Using data from EPA’s 33/50 Program, we show that failure to account for spillovers can lead to significant under-estimation of program impacts.
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Achieving a sustainable future will only be possible through the intersection of the best science and technology in combination with the societal, economic, policy, cultural, moral, and ethical ecosystem. Green chemistry and green engineering provide the scientific and technological foundation of the Elements of Sustainable Chemistry while the Humanitarian and Nobel Elements provide the imperative context. This alternative Periodic Table, strives to outline the range of aspects and tools that are available and needed to accomplish the daunting and necessary tasks of moving toward a sustainable tomorrow.
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Abstract Using Japanese facility-level data, we estimate the effects of ISO 14001 certification on the promotion of more advanced practices, namely green supply chain management (GSCM). Our results show that ISO 14001 promotes GSCM practices, in that facilities with environmental management systems (EMS) certified to ISO 14001 are 40 percent more likely to assess their suppliers’ environmental performance,and 50 percent more likely to require that their suppliers undertake specific environmental practices. Further, we find that government approaches that encourage voluntary EMS adoption indirectly promote GSCM practices, in that the probability offacilities’ assessing their suppliers’ environmental performance,and requiring them to undertake specific environmental practices increases by 9 percent and 10 percent, respectively, if a government assistance program exists. Combined, these findings suggest that there may be significant but previously unnoticed spillover effects of ISO 14001 and government promotion,of voluntary action. Key Words: voluntary actions, positive spillover, environmental management systems, ISO
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Purpose The purpose of this paper is to identify the critical factors (CFs) of ISO 14000; to determine if ISO 14000 certification results in improved organizational performance; and to analyze the levels of and changes in these CFs and levels of and changes in the indicators of organizational performance (IOPs) in relation to firm attributes considered in the present study. Design/methodology/approach The study employs questionnaire‐survey approach to obtain the practitioners' perceptions of ISO 14000 certification, levels of presence of CFs and changes in CFs due to certification, levels of presence of IOPs and changes in IOPs due to certification. The data collected have been analyzed by using statistical techniques. Findings The firms regard the preparation for emergencies as an integral part of environmental management system (EMS), and they seem to initially struggle to identify environmental issues that are to be given higher importance. Further, the certified firms find it difficult to continuously improve their environmental management processes. There are significant changes in all the CFs and IOPs due to ISO 14000 certification. Furthermore, more‐experienced firms have higher mean values of levels of all CFs, in comparison with less‐experienced firms. In the course of time, these firms appear to understand the EMS and effectively implement it in order to realize long‐term benefits. Research limitations/implications Results of the study are dependent on the nature and number of respondents, i.e. on the perceptions of the top management responsible for quality certification, and the sample size (number of respondents in the current study is 36 due to limited response rate and other operational constraints). Practical implications The present study would enable the practitioners to benchmark their organizations (in respect of levels of presence of CFs and levels of presence of IOPs) with those of their competitors, with the best‐in‐class, and also with the industry's mean level. The study also enables one to compare different categories of firms (e.g. firms with low, medium and high levels of turnover; national and international firms; etc.). Since, there is a significant improvement in the organizational performance due to certification, the study provides a strong empirical justification for non‐certified firms to go in for ISO 14000 certification. Originality/value The study conceptualizes ISO 14000 as a seven dimensional framework. Further, it has also identified several IOP related to ISO 14000 certified firms. A questionnaire has been developed to obtain the perceptions of top management about the ISO 14000 certification and related factors and indicators; the proposed instrument can be used for several purposes such as functional benchmarking.
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Over the past decade conservation groups have put considerable effort into educating consumers and changing patterns of household consumption. Many groups aiming to reduce overfishing and encourage sustainable fishing practices have turned to new market-based tools, including consumer awareness campaigns and seafood certification schemes (e.g. the Marine Stewardship Council) that have been well received by the fishing and fish marketing industries and by the public in many western countries. Here, we review difficulties that may impede further progress, such as consumer confusion, lack of traceability and a lack of demonstrably improved conservation status for the fish that are meant to be protected. Despite these issues, market-based initiatives may have a place in fisheries conservation in raising awareness among consumers and in encouraging suppliers to adopt better practices. We also present several additional avenues for market-based conservation measures that may strengthen or complement current initiatives, such as working higher in the demand chain, connecting seafood security to climate change via life cycle analysis, diverting small fish away from the fishmeal industry into human food markets, and the elimination of fisheries subsidies. Finally, as was done with greenhouse gas emissions, scientists, conservation groups and governments should set seafood consumption targets.
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This study explores the development of communitarian regulation in the American chemical industry by focusing on the history and challenges facing Responsible Care, the leading example of regulation by an industry association on the environmental scene today.
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While there is little empirical evidence regarding which types of environmental management systems (EMSs) are associated with greater environmental improvements, governments worldwide are encouraging facilities to adopt them. This research compares the environmental performance of facilities that adopt ISO 14001-certified EMSs, complete (uncertified) EMSs, and incomplete EMSs, across multiple environmental media. We analyze these relationships for manufacturing facilities in seven countries using a two-stage model to control for selection bias. Our findings indicate that the adoption of all types of EMSs is related to improved environmental performance in an international setting. However, ISO 14001-certified EMSs are associated with environmental improvements to a broader array of environmental media. These findings offer important implications about which types of EMSs have greater promise as voluntary environmental governance tools.
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Voluntary environmental programs (VEPs) promise to provide firms and facilities additional flexibility in managing their environmental affairs while increasing internal efficiencies and improving their public image. Although stakeholder input is thought to improve program development, little is known about the extent that stakeholders are involved in the VEP design process. Based on a survey of 61 program managers, this research distinguishes between the intensity and diversity of stakeholder involvement and uses these two concepts to assess VEP development relative to government, industry and third-party sponsorship. Even in the absence of a mandate, all three sponsors include a variety of stakeholders in program design. While there is evidence that collaborative relationships are developing between sponsors and a range of stakeholder groups, variations in the intensity of involvement among sponsors suggest that some stakeholders may have disproportionate levels of influence in the design of VEPs.
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Certification schemes have emerged in recent years to become a significant and innovative venue for standard setting and governance in the environmental realm. This review examines these schemes in the forest sector where, arguably, their development is among the most advanced of the sustainability labeling initiatives. Beginning with the origins, history, and features of schemes, the review synthesizes and assesses what we know about the direct effects and broader consequences of forest certification. Bearing in mind underlying factors affecting producers' decisions to certify, direct effects are examined by describing the uptake of schemes, the improvements to management of audited forests, and the ameliorative potential of certification for landscape-level concerns such as deforestation and forest protection. In assessing broader consequences, we look beyond the instrument itself to detail positive and negative unintended consequences, spillover effects, and longer-term and slow-moving effects that flow from the emergence of the certification innovation.
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Stakeholders who seek to reward or punish businesses for their environmental programs often cannot observe these organizations’ internal policies and operations. To address these informational problems, and signal their beyond-compliance environmental commitments, some businesses are participating in voluntary environmental programs (VEPs). This article examines whether business managers associate the brand value of VEPs – due to their differing program sponsors – with the perceived preferences of their critical stakeholders. Drawing on a novel data set of nearly 300 organizations, we assess business’ participation in 19 government- and industry-sponsored VEPs. We find that managers who recognize the importance of stakeholder influences on their business’ environmental practices are more likely to participate in a VEP but that pressures from different stakeholders are associated with variations in organizations’ participation in either government- or industry-sponsored VEPs.
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This article analyzes the factors that explain the international diffusion of voluntary international management standards. We argue that international management standards should not be analyzed in isolation but in conjunction with other standards and their institutional environment. We present two opposite views explaining how the previous diffusion of management standards facilitates or hampers the adoption of new management standards. We test a comprehensive model of diffusion of international environmental management standards within the chemical industry using a panel of 113 different countries during the period 2000 to 2003. Our results show that the previous experience of businesses in voluntary standards such as the Chemical Industry's Responsible Care Program or ISO 9000, government commitment toward Environmental Management Systems Standards, and the level of activity of international nongovernmental organizations in the country of adoption, impact positively on the adoption of ISO 14001 by chemical firms. Unlike previous studies that focused mostly on cross industry analyses, we do not find trade-related factors significant while explaining adoption in the chemical industry. Our results differ, therefore, from previous research and highlight the need to isolate industry effects to understand the diffusion of international standards.
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This study analyzes the initial implementation of the Sustainable Slopes Program a voluntary environmental initiative established by the U.S. National Ski Areas Association in partnership with federal and state government agencies. Our findings indicate that participation of western ski areas in the Sustainable Slopes Program is related to institutional pressures in the form of enhanced federal oversight and higher state environmental demands exerted by state agencies, local environmental groups and public opinion. The analysis also suggests that, despite these institutional pressures, participant ski areas appear to be correlated with lower third-party environmental performance ratings. This behavior seems to reflect the lack of specific institutional mechanisms to prevent opportunism in the current design of the Sustainable Slopes Program. That is, the program does not involve specific environmental standards, lacks third-party oversight, and does not have sanctions for poor performance.
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Public disclosure programs that collect and disseminate information about firms’ environmental performance are increasingly popular in both developed and developing countries. Yet little is known about whether they actually improve environmental performance, particularly in the latter setting. We use detailed plant-level survey data to evaluate the impact of India’s Green Rating Project (GRP) on the environmental performance of the country’s largest pulp and paper plants. We find that the GRP drove significant reductions in pollution loadings among dirty plants but not among cleaner ones. This result comports with statistical and anecdotal evaluations of similar disclosure programs. We also find that plants located in wealthier communities were more responsive to GRP ratings, as were single-plant firms. KeywordsPublic disclosure–Pollution control–India–Pulp and paper
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Using Japanese facility-level data, we estimate the effects of ISO 14001 certification on the promotion of more advanced practices, namely green supply chain management (GSCM). Our results show that ISO 14001 promotes GSCM practices. Facilities with environmental management systems (EMS) certified to ISO 14001 are 40% more likely to assess their suppliers' environmental performance and 50% more likely to require that their suppliers undertake specific environmental practices. Further, government programs that encourage voluntary EMS adoption indirectly promote GSCM practices. These programs increase the probabilities that facilities will assess their suppliers' environmental performance and require suppliers to undertake specific environmental practices by 7% and 8%, respectively. Combined, these findings suggest that there may be significant but previously unnoticed spillover effects of ISO 14001 and government promotion of voluntary action.
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Voluntary programs have become widespread tools for governments and nongovernmental actors looking to improve industry's environmental and regulatory performance. Voluntary programs can be conceptualized as club goods that provide nonrival but potentially excludable benefits to members. For firms, the value of joining a green club over taking the same actions unilaterally is to appropriate the club's positive brand reputation. Our analysis of about 3,700 U.S. facilities indicates that joining ISO 14001, an important nongovernmental voluntary program, improves facilities' compliance with government regulations. We conjecture that ISO 14001 is effective because its broad positive standing with external audiences provides a reputational benefit that helps induce facilities to take costly progressive environmental action they would not take unilaterally.
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This chapter explores a means of developing a formal economic model that can situate certain elements of club theory within a model of the private provision of a public good. “Warm glow” preferences are presented to begin the formulation of this model. This preference pertains to how. when consumers purchase of a green good, they care only about the private provision of the green characteristic. This model is then further extended to account for more general preferences, compared with the socially optimal club with the open-access market equilibrium club. In conclusion, the chapter develops an economic model that serves as a starting point for formal thought regarding “voluntary programs as clubs, nested within the context of public goods provision.”
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The American environmental movement is achieving popular support from many sectors of the society. This paper examines the evolution of the American environmental movement from its beginnings in some of the earliest periods in American history when voices in the wilderness warned against indiscriminate distruction of resources, to a point today where environmental concern is changing individual habits and influencing the decision-making process.
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An increasingly common regulatory tool is one that delegates the duty to provide information to the regulated entities, creating new problems in principal-agency models of regulation. Failure to comply with regulations mandating information provision is as much due to ignorance of reporting requirements as to willful evasion. A modified detection controlled estimation model for coverage, violation, and detection of facility compliance with the EPA's Toxics Release Inventory, estimated for facilities in Minnesota in 1991. Violation is better understood by those variables associated with the likelihood that the firm is ignorant of TRI reporting requirements, than by those associated with evasion. Firms in violation tend to be small facilities, releasing or transferring small amounts of toxins to the environment.
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Environmental management systems (EMSs) are intended to formalize procedures for managing and reducing environmental impacts. Construction firms typically do not have comprehensive and certified environmental management systems. This paper discusses the elements of environmental management systems, the relationship to the ISO 14001 standard, and the importance for construction firms to implement an EMS. A case study of a certified environmental management system for a construction firm is presented. Benefits and costs of such systems are identified. The paper concludes that construction firms should begin to work towards implementing more complete environmental management systems, although fully certified systems are not essential.
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Construction firms all over the world are increasingly seeking to obtain ISO 14001. The rapid growth in the number of ISO 14001 applications in Turkey and the share from the construction sector in this number, as a leading sector, is rather striking. This paper, using a structured questionnaire survey, investigates whether there is any dependence or relation between construction firms characteristics and having ISO 14001 certification and any difference in the perceptions related to ISO 14001 by considering both firm characteristics and two different groups as certified and non-certified firms. Additionally, it examines the perceived benefits of having ISO 14001 for certified construction firms. According to the results of analysis, although there is not any difference in perceptions on ISO 14001 certification in terms of firm characteristics and being as certified and non-certified and their both positive opinions about ISO 14001 certification. There is a relation between firms characteristics and having ISO 14001 certification. ISO 14001 certification contributes to construction firms not only in terms of environmental benefits but also with corporate management and marketing effects, thus verifying that the ISO 14001 has a positive impact on the Turkish construction sector.
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Globalization critics argue that international trade spurs a race to the bottom among national environmental standards. ISO 14001 is the most widely adopted voluntary environmental regulation which encourages firms to take environmental action beyond what domestic government regulations require. Drawing on a panel study of 108 countries over seven years, we investigate conditions under which trade linkages can encourage ISO 14001 adoption, thereby countering environmental races to the bottom. We find that trade linkages encourage ISO 14001 adoption if countries' major export markets have adopted this voluntary regulation.
Article
Environmental Management Systems (EMSS) represent a new generation of voluntary “beyond compliance” environmental policies that neither set substantive goals nor specify final outcomes. As a result, many stakeholder groups are lukewarm toward them. Since 1993 two major supranational EMSs—ISO 14001 and the European Union's Environmental Management and Audit Scheme (EMAS)—have been introduced. Firms receive formal accreditation after their EMS has been certified by outside verifiers. This accreditation can potentially bestow monetary and nonmonetary benefits on these firms. Firm-level EMS adoption patterns in the United Kingdom, Germany, and the United States vary, thereby suggesting that national contexts influence firms' responses to them. In Germany and the U.K. a significant number of sites have become either ISO 14001 or EMAS certified, while the take-up of ISO 14001 in the U.S. (EMAS is available only to European sites) has been less enthusiastic. This article begins with the hypothesis that firms in countries with adversarial economies— where regulators and business are on less than friendly terms—are less likely to adopt EMS-based programs. This hypothesis explains why ISO 14001 take-up has been relatively high in the U.K. and relatively low in the U.S. However, it cannot explain (1) the high rate of take-up of both ISO 14001 and EMAS in Germany, where the stringency of environmental legislation has been a contentious issue between the government and industry and (2) why EMAS has been more popular in Germany than in the U.K. This article argues that the original hypothesis, while largely correct, is underspecified. To better explain the cross-national differences in EMS adoption, one must take into account the type of adversarial economy (adversarial legalism versus prescriptive interventionism) and the nature of the policy regime (procedural versus substantive).
Article
When adopted in 1993, the European Union's Eco-Management and Audit Scheme (EMAS) was viewed as emblematic of a new policy approach involving more flexible and market-based environmental instruments. A few years after coming into force, EMAS does not appear to be a tremendous success in terms of industrial participation. Apart from in Germany and Austria, participation is insignificant and comparatively very far behind that in ISO 14001, the environmental management standard of the International Organization for Standardization. The paper seeks to explain this modest result. It focuses on the influence of the European and national regulators on industrial participation. Using a comparative analysis of the implementation of EMAS in France, Germany, the Netherlands and the United Kingdom, it argues that the most powerful participation leverage has been the granting of regulatory relief for registered companies. This leads one to be pessimistic as to the future of EMAS. The possibility and scope for a lighter regulatory touch are primarily nationally specific since they are related to the national regulatory traditions. Consequently, the systematic and comprehensive use of this leverage is unlikely to generalize. Copyright © 2002 John Wiley & Sons, Ltd. and ERP Environment.
Article
Voluntary environmental programs (VEPs) seek to improve the environment by encouraging, rather than mandating, businesses and other organizations to adopt environmentally protective measures. Since the 1990s, VEPs established by industry, government, and nongovernmental organizations have proliferated around the globe, raising the question of how effective these programs are in securing environmental protection, both on their own and in comparison to traditional mandatory regulations. This article reviews the emerging research literature on VEPs, describing the variation in their structures, providing a framework for assessing their impacts, and summarizing what is known about why organizations engage in voluntary environmental action and what effects these programs have on environmental quality.
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The Problem to be ExaminedThe Reciprocal Nature of the ProblemThe Pricing System with Liability for DamageThe Pricing System with No Liability for DamageThe Problem Illustrated AnewThe Cost of Market Transactions Taken into AccountThe Legal Delimitation of Rights and the Economic Problem
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This paper examines whether state governments perform systematically less environmental enforcement of facilities in communities with higher minority and low-income populations. Although this is an important claim made by environmental justice advocates, it has received little attention in the scholarly literature. Specifically, I analyze state regulatory enforcement of three U.S. pollution control laws-the Clean Air Act, the Clean Water Act, and the Resource Conservation and Recovery Act-over the period 1985-2000. To test for disparities in enforcement, I estimate a series of count models and find strong evidence across each of the three environmental laws that states perform less enforcement in poor counties, but little evidence of race-based inequities. © 2009 by the Association for Public Policy Analysis and Management.
Article
Compared to other economically advanced democracies, the United States is uniquely prone to adversarial, legalistic modes of policy formulation and implementation, shaped by the prospect of judicial review. While adversarial legalism facilitates the expression of justice-claims and challenges to official dogma, its costs are often neglected or minimized. A survey of existing research, together with a case study of environmental regulation in the Port of Oakland, indicates the extent to which adversarial legalism causes (or threatens) enormous dispute-resolving costs and procedural delays, which in turn distort policy outcomes. Adversarial legalism, moreover, has increased in recent decades, as Americans have attempted to implement the ambitious, socially transformative policies of activist government through political structures, forms of legislation, and legal procedures that reflect deep suspicion of governmental authority.
Article
In an attempt to avoid costly regulation and liability as a result of externalities, a number of trade associations have promoted industry self-regulation – the voluntary association of firms to control their collective behavior. However, previous studies have found that, without explicit sanctions for malfeasance, such self-regulatory programs are likely to attract more polluting firms. In this paper, we examine four environmental self-regulatory programs in the chemical, textile, and pulp and paper industries. Using a sample of over 4000 firms within these industries, we find evidence that in at least one program more polluting firms tended to join, while in another cleaner firms were more likely to join. We propose that differences in the structure of the programs drive the appearance of this form of adverse selection. In particular, we speculate that only when self-regulatory programs have explicit sanctions for malfeasance may they avoid adverse selection problems. Copyright © 2003 John Wiley & Sons, Ltd and ERP Environment.
Article
In this article we explore how much state is necessary to make governance work. We begin by clarifying concepts of governance and the “shadow of hierarchy” and we follow this clarification with a brief overview of empirical findings on governance research in developed countries. We then discuss the dilemmas for governance in areas of limited statehood, where political institutions are too weak to hierarchically adopt and enforce collectively binding rules. While prospects for effective policymaking appear to be rather bleak in these areas, we argue that governance research has consistently overlooked the existence of functional equivalents to the shadow of hierarchy. We assert that governance with(out) government can work even in the absence of a strong shadow of hierarchy, we identify functional equivalents to the shadow of hierarchy, and we discuss to what extent they can help overcome issues of legitimacy and effectiveness in areas of limited statehood.
Book
Can businesses voluntarily adopt progressive environmental policies? Most environmental regulations are based on the assumption that the pursuit of profit leads firms to pollute the environment, and therefore governments must impose mandatory regulations. However, new instruments such as voluntary programs are increasingly important. Drawing on the economic theory of club goods, this book offers a theoretical account of voluntary environmental programs by identifying the institutional features that influence conditions under which programs can be effective. By linking program efficacy to club design, it focuses attention on collective action challenges faced by green clubs. Several analytic techniques are used to investigate the adoption and efficacy of ISO 14001, the most widely recognized voluntary environmental program in the world. These analyses show that, while the value of ISO 14001's brand reputation varies across policy and economic contexts, on average ISO 14001 members pollute less and comply better with governmental regulations.
Book
Over the last two decades environmental issues have become important in public and business policy. This book asks why firms sometimes voluntarily adopt environmental policies which go beyond legal requirements. It employs a new-institutionalist perspective, and argues that existing explanations, especially from neoclassical economics, concentrate on external factors at the expense of internal dynamics. Prakash argues that ‘beyond-compliance’ policies are due to two types of intra-firm processes, which he describes as power- and leadership-based. His argument is supported by analysis of ten cases within two firms - Baxter International Inc. and Eli Lilly and Company - including interviews with managers, and access to meetings and documents. This book therefore examines the internal working of firms’ environmental policy in a theoretically rigorous way, providing a significant contribution to the theory of the firm. It will be valuable for students of business and environmental studies, as well as political economy and public policy.
Book
This book presents a theoretical treatment of externalities (i.e. uncompensated interdependencies), public goods, and club goods. The new edition updates and expands the discussion of externalities and their implications, coverage of asymmetric information, underlying game-theoretic formulations, and intuitive and graphical presentations. Aimed at well-prepared undergraduates and graduate students making a serious foray into this branch of economics, the analysis should also interest professional economists wishing to survey recent advances in the field. No other single source for the range of materials explored is currently available. Topics investigated include Nash equilibrium, Lindahl equilibria, club theory, preference-revelation mechanism, Pigouvian taxes, the commons, Coase Theorem, and static and repeated games. The authors use mathematical techniques only as much as necessary to pursue the economic argument. They develop key principles of public economics that are useful for subfields such as public choice, labor economics, economic growth, international economics, environmental and natural resource economics, and industrial organization.
Article
Voluntary environmental programs are codes of progressive environmental conduct that firms pledge to adopt. This paper investigates whether ISO 14001, a voluntary program with a weak sword-a weak monitoring and sanctioning mechanism-can mitigate shirking and improve participants' environmental performance. Sponsored by the International Organization for Standardization (ISO), ISO 14001 is the most widely adopted voluntary environmental program in the world. Our analysis of over 3,000 facilities regulated as major sources under the U.S. Clean Air Act suggests that ISO 14001-certified facilities reduce their pollution emissions more than non-certified facilities. This result persists even after controlling for facilities' emission and regulatory compliance histories as well as addressing potential endogeneity issues between facilities' environmental performance and their decisions to join ISO 14001. © 2005 by the Association for Public Policy Analysis and Management
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This paper uses new survey evidence to analyze the effects of regulation, plant-level management policies, and other factors on the environmental compliance of Mexican manufacturers. In Mexico and other developing countries, many plants avoid complying with regulations because monitoring and enforcement are sporadic. On the other hand, some plants overcomply because their abatement decisions are strongly affected by extra legal factors. We attempt to capture both possibilities in a model of decision making under uncertainty: A plant minimizes expected pollution-related costs by setting emissions intensity (emissions/output) at the point where marginal abatement cost is equal to the expected marginal penalty for polluting. Compliance status is determined by the positive or negative gap between the regulatory standard and the plant's cost-minimizing emissions intensity. Among determinants of the latter, we focus particularly on environmental management policies: the degree of effort to reduce emissions, and the type of management strategy which is adopted. Recognizing that these policies and emissions are simultaneously determined, we use two-stage least squares for econometric estimation. Our results suggest that environmental management has a strong, independent effect on compliance, even after we control for simultaneity and take many other determinants of emissions intensity into account. We conclude that in developing countries with weak regulation, the carrot of subsidized environmental management training may provide a useful complement to the uncertain stick of conventional enforcement.