IDEAS home Printed from https://ideas.repec.org/a/bla/bstrat/v22y2013i1p49-61.html
   My bibliography  Save this article

Which Corporate Sustainability Activities are Associated with Greater Financial Payoffs?

Author

Listed:
  • Brent Kurapatskie
  • Nicole Darnall

Abstract

While many company managers and academic researchers have argued that businesses that develop a sustainability focus also may improve their financial performance, little information is known about whether firms' different types of sustainability activities are related to varying degrees of financial gain. This paper assesses the economic relationship between two types of sustainability activities – lower‐ and higher‐order – derived from the sustainability value framework of Hart and Milstein (2003). Our analysis reveals that both types of sustainability activities are similarly associated with firms' financial performance in terms of direction and trend. However, the average level of financial benefits related to firms' higher‐order sustainability activities (which develop new products and processes) is greater than the average level of financial benefits related to firms' lower‐order sustainability activities (which modify existing products and processes). These findings offer initial evidence that companies that reach further by developing higher‐order sustainability activities may reap greater financial benefits, while improving the natural environment to a greater degree. Copyright © 2012 John Wiley & Sons, Ltd and ERP Environment.

Suggested Citation

  • Brent Kurapatskie & Nicole Darnall, 2013. "Which Corporate Sustainability Activities are Associated with Greater Financial Payoffs?," Business Strategy and the Environment, Wiley Blackwell, vol. 22(1), pages 49-61, January.
    • Handle: RePEc:bla:bstrat:v:22:y:2013:i:1:p:49-61
    DOI: 10.1002/bse.1735
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/bse.1735
    Download Restriction: no
    File URL: https://libkey.io/10.1002/bse.1735?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Lanoie, Paul & Laplante, Benoit & Roy, Maite, 1998. "Can capital markets create incentives for pollution control?," Ecological Economics, Elsevier, vol. 26(1), pages 31-41, July.
    2. Stuart L. Hart & Gautam Ahuja, 1996. "Does It Pay To Be Green? An Empirical Examination Of The Relationship Between Emission Reduction And Firm Performance," Business Strategy and the Environment, Wiley Blackwell, vol. 5(1), pages 30-37, March.
    3. Clark, Kim B., 1985. "The interaction of design hierarchies and market concepts in technological evolution," Research Policy, Elsevier, vol. 14(5), pages 235-251, October.
    4. Magali Delmas & Michael W. Toffel, 2004. "Stakeholders and environmental management practices: an institutional framework," Business Strategy and the Environment, Wiley Blackwell, vol. 13(4), pages 209-222, July.
    5. Nicole Darnall & G. Jason Jolley & Robert Handfield, 2008. "Environmental management systems and green supply chain management: complements for sustainability?," Business Strategy and the Environment, Wiley Blackwell, vol. 17(1), pages 30-45, January.
    6. Jean Kabongo & Olivier Boiral, 2011. "Creating Value with Wastes: A Model and Typology of Sustainability Within Firms," Business Strategy and the Environment, Wiley Blackwell, vol. 20(7), pages 441-455, November.
    7. World Commission on Environment and Development,, 1987. "Our Common Future," OUP Catalogue, Oxford University Press, number 9780192820808.
    8. Nicole Darnall & Joann Carmin, 2005. "Greener and cleaner? The signaling accuracy of U.S. voluntary environmental programs," Policy Sciences, Springer;Society of Policy Sciences, vol. 38(2), pages 71-90, September.
    9. Thomas Dyllick & Kai Hockerts, 2002. "Beyond the business case for corporate sustainability," Business Strategy and the Environment, Wiley Blackwell, vol. 11(2), pages 130-141, March.
    10. William Young & Fiona Tilley, 2006. "Can businesses move beyond efficiency? The shift toward effectiveness and equity in the corporate sustainability debate," Business Strategy and the Environment, Wiley Blackwell, vol. 15(6), pages 402-415, November.
    11. Robert D. Klassen & Curtis P. McLaughlin, 1996. "The Impact of Environmental Management on Firm Performance," Management Science, INFORMS, vol. 42(8), pages 1199-1214, August.
    12. Nick Johnstone (ed.), 2007. "Environmental Policy and Corporate Behaviour," Books, Edward Elgar Publishing, number 12551.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Stefan Ambec & Paul Lanoie, 2007. "When and Why Does It Pay To Be Green?," CIRANO Working Papers 2007s-20, CIRANO.
    2. Stefan Ambec & Paul Lanoie, 2009. "Performance environnementale et économique de l'entreprise," Economie & Prévision, La Documentation Française, vol. 0(4), pages 71-94.
    3. Schrettle, Stefan & Hinz, Andreas & Scherrer -Rathje, Maike & Friedli, Thomas, 2014. "Turning sustainability into action: Explaining firms' sustainability efforts and their impact on firm performance," International Journal of Production Economics, Elsevier, vol. 147(PA), pages 73-84.
    4. Peter Oberhofer & Elmar Fürst, 2013. "Sustainable Development in the Transport Sector: Influencing Environmental Behaviour and Performance," Business Strategy and the Environment, Wiley Blackwell, vol. 22(6), pages 374-389, September.
    5. Basil Al‐Najjar & Aspioni Anfimiadou, 2012. "Environmental Policies and Firm Value," Business Strategy and the Environment, Wiley Blackwell, vol. 21(1), pages 49-59, January.
    6. Angeloantonio Russo & Stefano Pogutz & Nicola Misani, 2021. "Paving the road toward eco‐effectiveness: Exploring the link between greenhouse gas emissions and firm performance," Business Strategy and the Environment, Wiley Blackwell, vol. 30(7), pages 3065-3078, November.
    7. Julia Wolf, 2013. "Improving the Sustainable Development of Firms: The Role of Employees," Business Strategy and the Environment, Wiley Blackwell, vol. 22(2), pages 92-108, February.
    8. Marileena Koskela & Jarmo Vehmas, 2012. "Defining Eco‐efficiency: A Case Study on the Finnish Forest Industry," Business Strategy and the Environment, Wiley Blackwell, vol. 21(8), pages 546-566, December.
    9. Julie Dekker & Tim Hasso, 2016. "Environmental Performance Focus in Private Family Firms: The Role of Social Embeddedness," Journal of Business Ethics, Springer, vol. 136(2), pages 293-309, June.
    10. Ozgur Isil & Michael T. Hernke, 2017. "The Triple Bottom Line: A Critical Review from a Transdisciplinary Perspective," Business Strategy and the Environment, Wiley Blackwell, vol. 26(8), pages 1235-1251, December.
    11. Anselm Schneider, 2015. "Reflexivity in Sustainability Accounting and Management: Transcending the Economic Focus of Corporate Sustainability," Journal of Business Ethics, Springer, vol. 127(3), pages 525-536, March.
    12. Hidemichi Fujii & Kimbara Tatsuo, 2012. "Environmental Management Mechanisms in U.S. and Japanese Manufacturing Firms," International Journal of Business Administration, International Journal of Business Administration, Sciedu Press, vol. 3(6), pages 13-24, November.
    13. Satish Kumar & Riya Sureka & Weng Marc Lim & Sachin Kumar Mangla & Nisha Goyal, 2021. "What do we know about business strategy and environmental research? Insights from Business Strategy and the Environment," Business Strategy and the Environment, Wiley Blackwell, vol. 30(8), pages 3454-3469, December.
    14. Annina Lattu & Yuzhuo Cai, 2020. "Tensions in the Sustainability of Higher Education—The Case of Finnish Universities," Sustainability, MDPI, vol. 12(5), pages 1-15, March.
    15. Surender Kumar & Pritika Dua, 2022. "Environmental management practices and financial performance: evidence from large listed Indian enterprises," Journal of Environmental Planning and Management, Taylor & Francis Journals, vol. 65(1), pages 37-61, January.
    16. Kimitaka Nishitani & M.B. Haider & Katsuhiko Kokubu, 2014. "Corporate Environmental Initiatives and Shareholder Value: Focusing on the Role of Environmental Information and Its Credibility," Discussion Paper Series DP2014-13, Research Institute for Economics & Business Administration, Kobe University.
    17. Sarah Elena Windolph & Dorli Harms & Stefan Schaltegger, 2014. "Motivations for Corporate Sustainability Management: Contrasting Survey Results and Implementation," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 21(5), pages 272-285, September.
    18. Elisabeth Albertini, 2017. "What We Know About The Environmental Policy: An Inductive Typology Of The Research," Post-Print hal-02148591, HAL.
    19. Yang Chen & Guiyao Tang & Jiafei Jin & Ji Li & Pascal Paillé, 2015. "Linking Market Orientation and Environmental Performance: The Influence of Environmental Strategy, Employee’s Environmental Involvement, and Environmental Product Quality," Journal of Business Ethics, Springer, vol. 127(2), pages 479-500, March.
    20. Bongani Munkuli & Renee Horne, 2018. "Financial Markets Value Reputation for Corporate Social Responsibility (CSR) – A Study of the South African Mining Sector," Africagrowth Agenda, Africagrowth Institute, vol. 15(2), pages 17-22.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:bstrat:v:22:y:2013:i:1:p:49-61. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://onlinelibrary.wiley.com/journal/10.1002/(ISSN)1099-0836 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.