Moving Beyond Profit: Expanding Research to Better Understand Business Environmental Management

An extensive economics literature has examined business environmental management to identify characteristics and external institutional stakeholder pressures that influence management decisions. Frequently, it is assumed that profit pursuit is the goal, and organizations subject to the same pressures respond similarly. Studies have identified a narrow set of influential stakeholders, but have revealed that organizations respond differently to them. Recent research shows that an important moderating influence is the manager’s attitude toward environmental protection, which may explain differing organizational responses, and that managers may perceive the ability to obtain utility beyond increased profit from engaging in strategic environmental management. A comprehensive framework for assessing moderating perceptions is lacking, but recent research combining institutional theory and utility maximization shows increased explanatory power and exposes the relative importance of manager perceptions. This paper synthesizes economics and management literature on institutional determinants of environmental management, utility maximization, and attitudes and behavior to illustrate the usefulness of an integrated approach for both disciplines.