When companies improve the sustainability of the natural environment: A study of large U.S. companies

Abstract

In light of the call for companies to abandon current approaches to environmental management, this study adds to the environmental strategy literature and uses the evidence of competitive dynamics among companies to identify a mechanism by which companies invest in proactive environmental strategies and thereby improve the sustainability of the natural environment. An examination utilizing fixed effects regressions on a sample of large U.S.‐based companies reveal that even after controlling the number, environmental and financial performance of leading (environmental) companies, laggard (environmental) companies are more likely to invest in proactive environmental strategies when their leading peers display higher sustainability orientations. Neither the expectation of government regulation nor social movement pressure was found to be influential in this relationship. Therefore, the future dominance of companies' investments in the sustainability of the natural environment will be driven by companies themselves as long as competitive advantages are expected.

Proactive environmental and social strategies in a small‐ to medium‐sized company: A case study of a Japanese SME

“…Similarly, Moura‐Leite, Padgett, and Galán (2014) have posited that due to limited resources and increased demands for social welfare, businesses should be concerned with issues such as environmental damage, product safety and human resource management. Further, there has always been an argument that there are differences between companies' attitudes to environmental and social concerns (De Mendonca & Zhou, 2019). Against this background, arguments on sustainability practices have always focused on large corporations whose impacts are highly significant (Lawrence, Collins, Pavlovich, & Arunachalam, 2006; Simpson, Taylor, & Barker, 2004; Studer, Tsang, Welford, & Hills, 2008; Rutherfoord et al, 2000).…”

Sustainability strategies by companies in the global coffee sector

“…Following Rogers' theory on the diffusion of innovation (Rogers, 1962), sustainability leaders could be seen as innovators in a general industry transition towards sustainability. By acting more sustainably, these actors can induce ‘laggards’ to enact higher sustainability ambitions (De Mendonca & Zhou, 2020), facilitating sector mainstreaming. However, these companies could also use sustainability to differentiate themselves from mainstream competitors, appealing to sustainability‐conscious stakeholders.…”

How Do Proactive Environmental Strategies Affect Green Innovation? The Moderating Role of Environmental Regulations and Firm Performance

“…Consequently, firms with proactive environmental strategies should be able to gain the innovation. At market level, firms with proactive environmental strategies are associated with first mover advantage [4]. Moreover, they concluded that sustainable development of the firms is linked with proactive environmental strategies.…”

“…Hence, these environmental problems generate the need to investigate the industrial sector in the context of environmental practices. Prior literature on environmental practices provided reasons to motivate firms to seek proactive environmental strategies [4]. Moreover, currently, the sustainable environment is very important for firms because it enhances the shareholders' confidence, as well [5].…”